Lease Questions - Ask Here

sfcharlie · January 2005

Thanks, again, kyfdx:

I had forgotten Car_Man's earlier posting numbers.

On the BMW lease I took in September, I mentioned, in an earlier posting, a charge labeled "Rent Charge" which was quite substantial ($3,262.32) and was added to the decline in value number before dividing by 24 to get the monthly payment.

Car_Man and kyfdx, is that business as usual or was that an exorbitant extra charge?

Regards,

SFCharlie

kyfdx · January 2005

but.. there are two components to the lease payment..

Depreciation (selling price - residual / no.of pymts.)

Finance charge (aka rent charge).. [MF X (residual + cap cost)] this gives you a monthly figure.. multiply it by the number of payments and you get a total "rent charge".

When you leased in September, residuals were likely very low.. it was the end of the model year.. Also, payments on a 24 month lease are usually fairly high and sometimes the end of the model year is not a good time to lease. Car_man gave you an example on an '05 a few posts back.. As you can see.. the lease deals on new '05 BMWs are generally pretty good right now..

regards,

kyfdx

ackerman · January 2005

Thank you Car_Man.

I forgot to ask what the Residual is on 30 Month Lease with only 10K miles per year?

Don Ackerman

jim53 · January 2005

Car_man, can you please provide me with the residual and money factor assuming a 10K mile per year lease (assuming that is available otherwise 12K) for 36 months (and 39 month if available):

BMW 545

BMW 530

Mercedes E500

Acura RL

Thanks as always.

sfcharlie · January 2005

Car_Man and kyfdx:

kyfdx...I'm not sure of the "etiquette" of this forum, but I take everything I read here just as grist for the mill, so I don't experience your as usurping anyone's authority. Car_Man seems to read everything posted and so, I imagine, he would confirm, counterpoint, etc, as he sees fit...and you're comments are educational. So...

By working backwards (that is, knowing all the variables in the equation, except for the MF), I was able to calculate that the MF on my BMW lease was .00235 ... If I ended up paying a lot more than I "should have", it must have been due to either the adjusted cap cost of $33,620.43 being too high and/or the residual of $24,221.60 being too low. At least, it would appear that way. If I divide the residual of $24,000 by the Gross cap Cost of $34,000, the residual percentage would be about 70%, but maybe the residual should be divided by the MSRP (and they appeared to be taking about $3,000 of the MSRP because it was the end of the model year) which would produce a residual percent of about 65% which seems in the ballpark of what Car_Man thought. So, the only place I can figure I should pushed harder was on the price.

Regards to both Car_Man and kyfdx,

SFCharlie

ruggy · January 2005

MAYBE YOU CAN HELP ME.........AUDI A8L......MSRP 79820........COST TO BUY 76896........1127 PER MOS. 3 YEAR / 15K

1165 3 YEAR/18K.... LOOKS LIKE .00125% MONEY FACTOR AND 56 % RESIDUAL....WHAT DO YOU THINK...NOT SURE IF IT'S GOOD OR NOT.... O DOWN

THANKS

kyfdx · January 2005

I think you have a pretty good handle on it... Memory fails me.. but, I think there was some sort of dealer cash incentive on it, at that time, so you may have paid a little too much.. and, they may have bumped up the MF on you.. those two things together can easily add $50-$60 per month, on to the price..

This is really Car_man's forum.. I know he doesn't mind the rest of us chipping in with comments.. I just try to let everyone know that I am not the expert that he is... And..most come here specifically for his advice..

Good luck with that MINI convertible,

kyfdx

rbarone · January 2005

Thank you--kind sir..

tempnirvana · January 2005

Hello all.

I was a novice when I leased my 2004 XC90. On a 15K mileage/yr, and 4 yr lease I pay 635/month.

Based on what I read in this forum, I got a screw-job on this deal. In any case, I called my bank (US Bank) to ask about the buy-out price. It's about 39K.

What are my options to get out of this lease? Any advise will be greatly appreciated.

paulsfca · January 2005

Car-man,

In posting #16464 you quoted that Honda's lease money factor and residual value are .00077 and 55% for a basic Accord model. Will these numbers apply to a loaded Honda Accord EX 6 cylinder as well?

Thanks.

lycanthris · January 2005

Looking at a 2005 Honda Pilot EX

Auto, no leather or Navi

MSRP: 30,400

Selling price: 27,200

What is the MF, residual and payment for the following terms?

24/12k

36/12k

Thanks so much again.

rroyce10 · January 2005

..... Get a little north of the Mason/Dixon line and I'm sure you'll find quite a few Mini dealers that will do a little $1,200/$1,500 "two step" .. remember, they're also on a quarterly/yearly allocation ~ the deeper the snow, the deeper the discount ......................

Terry.

mabubba · January 2005

From what I have read about leases, on Edmunds and elsewhere, you are obligated to comply with the leasing terms until the lease is up in 4 years. Usually banks want you to pay off all of the remaining payments plus the residual that's stipulated in the lease contract, making it very painful to get out of a lease. Maybe Carman or kyfdx can elaborate more...

kyfdx · January 2005

I hear you.. just anywhere within a couple hours of Cincinnati.. they are pretty good at sticking to it... Even with snow up to their you-know-what..

But, then again.. the dealer here is only 9 miles north of the line....

I'm sure someone is discounting.. but, you know if you can't find someone crowing about it on Edmunds, it must be kind of rare...

regards,

kyfdx

rroyce10 · January 2005

...... Like all of those less than invoice prices on CR-V SE's ..l.o.l... don't be so naive ...

Let em' sit in the snow for a few more weeks until the next floorplan check ... that ticking clock always has a tendency to wake someone up ..

Terry.

leowin · January 2005

Hi,

Recently, I came across a site (www.leasebusters.com) offering lease takeovers. Some of the offers were very attractive, with present owners offering upto a grand as additional discount to take over their lease.

Has anybody any experience in lease takeovers?

There are some savings, but what are the hidden traps in this?

adrian1 · January 2005

Do you know the reisdual value of the Ls 430 with the custom package and smart key? how should these extra options effect the residual? also any suggestions on which banks to go to for a lease loan. I have heard I should start with the bank I bank at? is that true?

nupeskee · January 2005

Car_man this is the information I got from the dealer for the Sienna XLE and XLE Limited. These are the money factors

Tier 1+ .00190

Tier 1 .00200

The residual on the model I am looking at (XLE Limited with limited package #2 (DVD & NAV) is 20,818 STD (52%) and 21,524 LOW (54%). Can you validate these numbers and tell me if these residuals are right? If so what does the STD, LOW mean? Which one should I use? I am in the Kansas City area. Thanks.

kchen7 · January 2005

Hi kyfdx, so recapping the lease offer I have

for a 2005 BMW X3 3.0i custom order:

$38,650 invoice / $42,220 MSRP

+ $440 over

+ $330 MACO

+ $384.67 fees

+ $825 acquisition fee

36 mos @ 15k/yr

MF .00125

Residual 57%

$500.00/mo including tax + $3735.37 total drive off

[I had requested them to limit to $500/mo initially]

Crunching these numbers down, I get:

$568.23/mo [including my 7.25% tax]

$1452.90 total drive off

--Are my numbers close?

--Should I insist on the base bank fee?

--How is this deal overall?

Thanks,

kchen7

prince812 · January 2005

I am interested in leasing from Toyota as well.

Do you know the difference (score wise) between tier 1+ and tier 1?

Also do you know what the dollar amount difference translates into between Tier 1+ .00190

Tier 1 .00200?

$10 per month? More?

Car-man please feel free to jump in if you have any info.

trneal276 · January 2005

Thanx a million for your response carman. I appreciate it. I know that is a high amount for a lease payment, butI just wanted to make sure that my dealer was being half-way honest.

Terry

CarMan@Edmunds · January 2005

Welcome aboard Paul. The capitalized cost of the vehicles that you are interested in depend upon what sort of selling price you are able to negotiate on them with dealers. I can give you an idea of what the lease programs are currently like on the models that you are interested in though. According to the latest information that I have seen, if you were to lease a 2005 Subaru Forester XT through its captive finance company in January for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00130 and 50%, respectively.

If you were to lease a 2005 Saab 9-3 Arc Sedan through Saab Financial Services Corp. in January for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00049 and 49%. Saab is also providing $2,500 lease cash on this car that will help you to negotiate an attractive capitalized cost.

Well, that pretty much sums it up, but please let me know if you have any other questions.

Car_man

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CarMan@Edmunds · January 2005

Hey Chigirl. The base lease rates and residual values for 3 year, 12,000 miles per leases of these trucks are as follows: 5.0% (.00208) / 57% for the 2005 Chevrolet Silverado Crew Cab and 7.25% (.00302) / 52% for the 2005 Ford F-150 XLT Crew Cab XLT 2WD and 2005 Ford F-150 Lariat Crew Cab 2WD. The options that these trucks have will not have any impact upon their residual value percentages. Don't forget to take the lease cash that is available on them into account when negotiating their capitalized costs. Good luck and make sure to let us know how everything turns out.

Car_man

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CarMan@Edmunds · January 2005

You're welcome, JMOB. Let's work up a sample payment on this vehicle for you and see what we come up with. According to my calculations, if you were to lease a 2005 Subaru Forester XS with an MSRP of $27,100 and a selling price of $24,684 through its captive finance company right now for 3 years with 15,000 miles per, its zero down, pre-tax monthly payment should be around $363.

Car_man

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CarMan@Edmunds · January 2005

Here you go, lycanthris. If you were to lease a 2005 Honda Pilot EX (no leather or navi) through American Honda Finance Corp. right now for 2 years with 12,000 miles per, its base lease money factor and residual value should be .00154 and 72%, respectively. The numbers for an otherwise identical 3 year lease should be .00154 and 63%. Using these numbers, an MSRP of $30,435, and a selling price of $27,932, I estimate that this truck would have two and three year zero down, pre-tax monthly lease payments of $328 and $316, respectively.

Car_man

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CarMan@Edmunds · January 2005

Greetings planoman. According to the latest information that I have seen, if you were to lease a 2005 Lexus RX 330 4WD without the navigation or rear entertainment system through Lexus Financial Services right now for 3 years with 15,000 miles per, its base lease money factor and residual value for consumers who qualify for its Tier 1 credit tier should be .00145 and 56%, respectively. The numbers for an otherwise identical 4 year lease of this truck should be .00145 and 47%.

Car_man

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CarMan@Edmunds · January 2005

Hi Keyman21. It sounds as though you probably should purchase your next vehicle rather than lease it. I say this because you were not able to wait until the scheduled end of your current lease to get a new vehicle and you exceeded your mileage limit.

It is usually fairly expensive to get out of leases well before their scheduled end dates. In order to do so, you need to purchase the vehicle that you are currently leasing from the bank that you are leasing it through. It often turns out that it costs more to do so than your vehicle is worth on the open market. Furthermore, many banks expect consumers who end their leases early to still make all, or at least the depreciation portion of their remaining lease payments. As you can see, this can get very expensive.

You can determine approximately how much it will cost you to get out of your current lease by comparing its purchase price to its value on the open market at this time. You should place a call to the bank that you are leasing your vehicle through to find out its exact price. Once you know exactly how much money it is going to cost you to buy your leased vehicle you need to compare it to its current value on the open market. You can find out approximately what your vehicle is worth by looking up its Edmunds.com True Market Value in the Used Vehicle Pricing section of this site. You also may want to stop by the following discussion: "Real-World Trade-In Values". One of our most knowledgeable community members, Terry, frequents that discussion and he is often kind enough to give community members who give him an accurate description of their vehicles with his opinion on their value. Don't forget to check to see if you are still on the hook for your remaining lease payments. The difference between your leased vehicle's current value and how much it will cost you to buy it plus any remaining lease payments that you are obligated to pay will equal the cost of getting out of your lease right now. Purchasing your leased vehicle now will prevent you from having to pay any sort of excess mileage penalty, but you may find that you are better off waiting until you are closer to the scheduled end of your lease to get another new vehicle.

Car_man

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CarMan@Edmunds · January 2005

Hey kchen7. When purchasing a new vehicle, it is important to look at the deal as a whole. Basically you are getting this X3 for $650 over invoice with the base money factor being used to calculate its payment. This is a good price. If you like the truck, I don't see any reason not to go for it.

Car_man

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CarMan@Edmunds · January 2005

Prince812, each bank has its own guidelines as to what sort of credit score is necessary to qualify for its lowest lease money factors. I believe that I posted a general message about Toyota Financial Services', or Lexus Financial Services' which I think is about the same, cutoffs for its credit tiers a day or so ago.

Toyota has not announced what its lease program will be like on the 2005 Avalon yet. When this car is introduced, I highly doubt that Toyota will provide any sort of lease support on it. If that is indeed the case, and you were to lease one through Toyota Financial Services, you would have to use its standard lease money factor. The last time that I saw it, its base standard money factor for consumers who qualify for its Tier 1 credit tier was around .00225.

Car_man

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CarMan@Edmunds · January 2005

Hello Seacarfan. You never mentioned the MSRP of the car that you are interested in leasing. This is an important number for you as a consumer to know for two reasons. First, the selling prices of leased vehicles can be negotiated, just as if you were paying cash for them. Without knowing the MSRP of the car that you want it is difficult to tell how much of a discount you are being given on it. The second reason is that one needs the MSRP of a vehicle that they want to lease is that it is necessary to calculate its lease payment. I would be more than happy to work up a sample lease payment on the car that you are interested in for you if you let me know what its MSRP is. I can tell you right now that the base lease money factor for a 2005 Mercedes-Benz E500 Sedan is only .00240 in most areas so the dealer that you are working with may be marking-up this car's month factor a little bit.

Car_man

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CarMan@Edmunds · January 2005

Hey sfcharlie. Lease calculators that do not use captive finance companies' actual lease money factors and residual values to generate payments are fairly worthless. I believe that the lease calculator that is available here at Edmunds.com uses some sort of average interest rate and ALG (an industry standard for unsupported residual values) residuals to calculate lease payments on vehicles. The info that I gave you is what it would actually cost to lease this car if you were to lease it through BMW FS at this time.

Car_man

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CarMan@Edmunds · January 2005

Hi euza. As you are probably aware, Toyota sells vehicles in the southeastern United States through an independent distributor. This distributor uses its own bank, Southeast Toyota Finance or something like that, to lease vehicles rather than Toyota Financial Services. Unfortunately, I have not seen SE Toyota's current lease program for the truck that you are interested in. Sorry that I could not be of any more help.

Car_man

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tonyh · January 2005

Hi Car Man. There are a few vehicles that I'm considering for my next lease, the primary is an Outback Sedan. Do you know what the current residual percentage is and a good money factor on the 36 month and 48 month lease?

CarMan@Edmunds · January 2005

Here you go Don. BMW FS' base factor and residual for a 30 month, 10,000 mile lease of a 2005 330i should be .00225 and 60% through the end of the month. Don't forget that BMW is providing $3,800 dealer cash on this car that will help you to negotiate an attractive capitalized cost.

Car_man

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CarMan@Edmunds · January 2005

Here is the info that you are looking for jim53. If you were to lease a 2005 BMW 545i through BMW FS right now for 3 years with 10,000 miles per, its base lease money factor and residual value should be .00100 and 62%, respectively. The numbers for an otherwise identical lease of a 2005 BMW 530i should be .00125 and 63% through the end of the month.

If you were to lease a 2005 Mercedes-Benz E500 Sedan through Mercedes-Benz Credit right now for 39 months with 10,000 miles per year, its base lease money factor and residual value should be .00235 and 58%, respectively.

Last but not least, if you were to lease a 2005 Acura RL through American Honda Finance Corp. right now for 39 months with 12,000 miles per year, its base lease money factor and residual value should be .00235 and 49%.

Car_man

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CarMan@Edmunds · January 2005

Kyfdx, you're not poaching my posts at all. I am happy that there is someone who is as knowledgeable as you who wants to help community members out. Keep the informative posts comin'

.

Car_man

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CarMan@Edmunds · January 2005

Hi ruggy. The lease money factor and residual value that you posted are right in line with Audi Financial Services' base lease program for the 2005 A8. This is a good thing. It means that all you have to focus on to get a good deal is this car's selling price. Using the prices that you mentioned in your post, I came up with a zero down, pre-tax lease payment of $1,047 for a 3 year, 15,000 miles per lease of this car. You may be able to squeeze a few hundred more out of this car's selling price, but other than that this deal looks good to me.

Car_man

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CarMan@Edmunds · January 2005

You're very welcome, rbarone.

Car_man

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CarMan@Edmunds · January 2005

Hi tempnirvana. I am sorry to say that it is usually fairly expensive to get out of leases well before their scheduled end dates. In order to do so, you need to purchase the vehicle that you are currently leasing from the bank that you are leasing it through. It often turns out that it costs more to do so than your vehicle is worth on the open market. Furthermore, many banks expect consumers who end their leases early to still make all, or at least the depreciation portion of their remaining lease payments. As you can see, this can get very expensive.

You can determine approximately how much it will cost you to get out of your current lease by comparing its purchase price to its value on the open market at this time. You should place a call to the bank that you are leasing your vehicle through to find out its exact price. Once you know exactly how much money it is going to cost you to buy your leased vehicle you need to compare it to its current value on the open market. You can find out approximately what your vehicle is worth by looking up its Edmunds.com True Market Value in the Used Vehicle Pricing section of this site. You also may want to stop by the following discussion: "Real-World Trade-In Values". One of our most knowledgeable community members, Terry, frequents that discussion and he is often kind enough to give community members who give him an accurate description of their vehicles with his opinion on their value. Don't forget to check to see if you are still on the hook for your remaining lease payments. The difference between your leased vehicle's current value and how much it will cost you to buy it plus any remaining lease payments that you are obligated to pay will equal the cost of getting out of your lease right now. You may find that you are better off chalking up your expensive lease as a learning experience and waiting until you are closer to the scheduled end of your lease to get another new vehicle.

Car_man

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seacarfan · January 2005

Hi Car-Man:

Thanks for your reply, and I apologize for not giving you all the info. Here are the numbers for the vehicle:

MSRP $63165 (including gas guzzler and delivery)

Selling Price $54995 (This must be the CAP COST)

39 months at 10K miles per year

Residual $34025 (55%)

Down pmt $0 (but I need to pay 1st month + fees)

Money factor .00295

Quoted monthly payment $832.59 + tax

I hope the above info is complete for you. I've noticed in some of the other postings that money factors can vary for a given vehicle--is it dependant on credit scores?

Also, the salesman stated that an 05 E500 4MATIC's residual would be 58%--is the difference due to this being an 04 model? At only 10K miles per year, I would have thought the residual of 55% would have been slightly higher.

Thanks for looking into this

seacarfan

CarMan@Edmunds · January 2005

Paulsfca, Honda is two different lease money factors for the 2005 Accord .00077 for up to 3 years on DX / LX and .00118 for up to 3 years on EX models.

Car_man

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ruggy · January 2005

car-man.......awesome information for me.the sticker is over 79820k and im gettting it for 76896 . this is a car im ordering from audi..does that give them any reason to knock more dollars off? or do you thnk the 76,896 is a decent #

CarMan@Edmunds · January 2005

Here's the info that you're looking for, lycanthris. If you were to lease a 2005 Honda Pilot EX without leather, navigation, or the rear entertainment system through AHFC right now for 2 years with 12,000 miles per, its base money factor and residual value should be .00154 and 72%. The numbers for an otherwise identical 3 year lease should be .00154 and 63%.

Car_man

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tempnirvana · January 2005

Thank You Car_Man and mabubba for your responses.

I received a buy-out quote from the bank yesterday, and it is 38.6K. I need to check the other links you mentioned to see if it's worth keeping the vehicle or eat some costs, and sell it now.

Once again, thanks for your responses.

kyfdx · January 2005

Swapalease.com is the biggest lease takeover service.. They are based in Cincinnati, owned by a local dealership group (more or less) and known to be knowledgeable and reputable..

I would look there first...

regards,

kyfdx

kyfdx · January 2005

kchen7...

I come up with about $533 + tax.. which puts me about $5/mo. higher than your figure..

Also, I'm assuming your drive off includes 1st payment, the $384.67 in fees, and a security deposit.. The security deposit would be $600, not $500, so up your drive off by $100.

I think this is a good deal.. I wouldn't get sticky on that extra $200 in the bank fee, if they can get their numbers to agree with yours..

At this point.. you need to concentrate on just a few things.

1) That you are getting the exact car with the same MSRP as in the example.

2) The dealer agrees with your drive-off and monthly payment figure.. including tax.

3) The lease term is indeed 3yr/45K.

If all those terms are met.. then you can forget all of the other numbers you used to get to this point.. Just consider the deal at $640 over invoice, and be happy that you got a good deal.

regards,

kyfdx

roon · January 2005

Looking at loaded Touring 38.8 MSRP. What is fair money factor, resid%. In Philly area.

dawnf · January 2005

I leased a 2003 Toyota Camry. I am only 6,000 miles away from my maximum mileage allowance and have 13 months left on my lease. If I buyout my lease early and purchase the car, can I negotiate a price? When I inquired at the dealer, they took what I owe on the car and financed it at another 5 year. How do I go about this and not get ripped off?

euza · January 2005

Thanks Car_man

How close you think Edmunds residuals are compared to those that SETF uses?

Using my zip code, Edmunds gives me 57% residual for a 2005 4RunnerSR5 2wd for 36 months, 15k miles.

Cars.com gives me 54% for the 2004 model, same conditions.

planoman · January 2005

Dear car_man:

Thanks for your response. Your advise and responses are so valuable and are of immense help to buyers like me. Please keep up the good work.

Thanks again.

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