Lease Questions - Ask Here

nupeskee · January 2005

My dealer told me that to get tier 1+ you need a beacon score of 730 or above. I built a spread sheet that I plan on taking with me to the dealer to verify their form of math. The difference on my spreadsheet between the two rates was $5.

jim53 · January 2005

Thanks Car_man. Do you (or anyone) happen to know the details of the current multiple security deposit feature for BMWFS? On my current lease I was able to put up to 9 extra security deposits down and get .0001 off the MF for each one. I was told by a salesman that they only allow up to 5 extra deposits and that the reduction in MF is now lower.

sfcharlie · January 2005

Car_Man:

Thanks! Thanks a very helpful clarification. The actual money factor used by BMW Finance on my 325i back in September, I learned, was .0023.

SFCharlie

paulsfca · January 2005

Thanks, Carman. I'll assume residual value remains the same for either model level unless you advise differently (?).

Appreciate your help!

Paul

paulsfca · January 2005

Car man,

Extremely helpful info - many thanks!

If we move ahead and do a deal on these cars (or a Honda Accord we are looking at as well), I will be sure to share the info with the forum.

Paul

stalnaker · January 2005

Thanks for the reply. I appreciate it. It looks like the dealer in Indianapolis isn't willing to budget on their pricing. I can't even approach those numbers that you gave me for the TSX and TL with them. I'm going to see what I can find from dealers in the Chicago area, since that's only a 2-hour drive from where I live.

By the way, I have scratched the A4 off of my list after test-driving one last night. The suspension is so firm that I feel every bump and imperfection in the road. Plus the engine is so sluggish. My Acura CL seems like a much more luxurious car than the A4.....more powerful, quieter inside, and better materials.

Ernest

stalnaker · January 2005

Thanks for your reply.

I was seriously considering the A4 until I test-drove one last night. I was shocked at how firm the suspension was. I felt every bump and imperfection in the road. Also, the outside noise was very noticeable and the engine was quite sluggish. I was expecting that the car would be an upgrade from my Acura CL in terms of luxury, but my Acura is definitely a quieter, smoother, more powerful vehicle.

At this point I'm kind of disillusioned with Audi and am probably going to have to go back to the drawing board. I might end up having to pay more than I would like to stay with Acura. But if the TL has vibration problems that might cause me to hesitate.

It seems like it's hard to find any company that can make a good car at a decent price these days.

Ernest

kyfdx · January 2005

Your dealer is correct.. the program changed last summer..

5 extra deposits... .00005 off for each one, for a total reduction available of .00025

Under the old plan, you could get a total reduction of .0009

The new plan is almost not worth the bother..

regards,

kyfdx

scott31 · January 2005

Car_man, you stated in a Dec post that Volvo offered $1850 to the dealer if one used non-Volvo leasing. I have heard numbers of $2500. I looked on Edmunds, and the current listed amount is $1500. Is that the current cash amt offered if you don't lease thru Volvo? If I don't lease thru Volvo, do you have access to various Bank lease rates so I can verify that the dealer isn't trying to pad the MF? And I might as well as while I'm at it, what are the current 36 and 39 month lease rates for a T5 AWD 6M?

Thanks!

lycanthris · January 2005

My girlfriend is looking at a 2005 Mazda 3s. Can you supply MF, residuals and approx. monthly payments based on the following:

2005 Mazda 3s (w/o navi)

MSRP: 21,160

Selling price: 20,000

looking for a 24 or 36 mo lease at 12k per year

Thanks again!

tcmotorcity · January 2005

Car man,

You recently posted the 2005 Sequoia SR5 residual value at 65% for a 3yr/15K lease. You also stated that the 12K lease would add 2 pts to the residual value making it 67%.

The dealer that I am working with has given me a residual value of $25,625 for a SR5 with an MSRP of $43,199. They say this is for a 3yr/12K lease -- this is 59%. Can you confirm for me that the dealer is incorrect? Or tell me what I am missing? Thanks.

jim53 · January 2005

That is unfortunate but I don't blame them. The old plan gave you around a 16% return on your money (after tax) while the new one is closer to 8% it looks like. Still probably better than what I can do in the market unfortunetly but not as attractive.

jim53 · January 2005

One other question. Do you have any idea if the BMW residual and money factors will still be available after Monday? I may not be able to get to a dealer and work out the details before Tuesday or Wednesday.

storkey7 · January 2005

Hello Car_man,

I am talking to a dealer about leasing an altima and I mentioned to him the $1,500 rebate that nissan is offering now and he told me it is not for leases onlt to buy the car. Isn't the 1,500 talkin off the cars cost even though it is a lease.

Thanks,

Marissa

jbaer · January 2005

Car_man and others on the board,

This is a difficult question to answer but I am trying to figure out whether we should get a 12k miles/yr lease or 15k miles/yr lease? Having never really owned a car or commuted much I don't really know what to expect. Basically I will be driving to and from work 5 days a week, distance will be 10-20miles round trip. We aren't the type to do the long distance family vacation auto trips and otherwise our driving would probably be considered on the moderate end. Any advice or suggestion is greatly appreciated. Thanks.

00boxsters · January 2005

If I was not certain to stay below 12K miles per year then I would opt for the 15K as cheap insurance!

Anyone in your neighborhood also work near you? Ask them what their annual mileage came too and how similar their vacation, visiting habits are as well to get a sense.

kyfdx · January 2005

Well... your description of your driving habits points to 12K/yr being enough..

But, I agree with the message above... If you aren't sure, ask a neighbor how far they drive each year... and if you still aren't sure, get the 15K.. It will cost you about $20/mo. more on a $30K car.

regards,

kyfdx

dawnied · January 2005

thanks for the info, Car Man! Can you tell me the money factors offered by Toyota Financial right now in both LA and San Fran area for a person with Tier I or II credit? I have great credit but want to make sure I'm not getting ripped off after I negotiate the price. Do I multiply the money factor by 2400 to get the actual APR? What is the calculation so I can figure my interest out while sitting in the dealer chair of doom? I just received a quote today for $28k before tax/reg, what could I expect to pay on a lease in LA for that price?

CarMan@Edmunds · January 2005

Hi adrian1. I have seen the current lease program for the Lexus LS 430 and would be more than happy to give you an idea of what it is like. However, in order for me to do so I need you to tell me how long you want to lease this car for and how many miles per year you need to be able to drive it. The only options that have an impact upon this car's residual values are the navigation system, pre-collision, and the Ultra Luxury package.

If you want to finance this car you definitely should get pre-approved to do so through a local bank or credit union. Doing so will give you an idea of what sort of interest rate to expect and will often motivate dealers to try to beat the rate that you already have. Leasing is a little different though. It is usually fairly difficult for consumers to find an attractive lease program on their own and they are usually better off researching what the manufacturer's lease program is like on the car or truck that they want and then having the dealer arrange things.

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CarMan@Edmunds · January 2005

I would be more than happy to take a look at the lease program that you were quoted, nupeskee. Toyota must be feeling a lot of heat from the redesigned Honda Odyssey because for the first time in ages it actually introduced a special financing program on certain 2005 Sienna models, specifically the CE and LE, mid-month. I believe that it also enhanced its lease program on these trim levels. Unfortunately, it did not make any enhancements that I am aware of on the Sienna XLE or XLE Limited that you are interested in. Toyota Financial Services' base lease money factor is indeed currently .00200 on the 2005 Sienna XLE / XLE Limited for Tier 1 customers in your area, with a .00010 reduction for Tier 1+ customers.

The terms "STD" and "LOW" most likely refer to the mileage allowance for your lease, with STD being 15,000 miles per year and LOW being 12,000 miles per. TFS' 39 month, 15,000 miles per year residual value for an '05 Sienna XLE Limited is indeed currently 54%.

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CarMan@Edmunds · January 2005

Hey prince812. I am not sure of the exact cut off point between Toyota's Tier 1 and Tier 1+ credit tiers, but I believe Tier 1+ is for consumers with credit scores in the mid- to high 700 range (possibly 730+) and Tier 1 is for consumers with scores in the low 700's to high 600's. The difference in lease payment that a .00010 reduction in a lease money factor will provide depends upon the price of the vehicle that is being leased and how long it is being leased for.

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CarMan@Edmunds · January 2005

You're very welcome, Terry.

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CarMan@Edmunds · January 2005

Hi tonyh. Subaru's current lease program is only scheduled to run through January 31st, but I would be more than happy to give you an idea of what it is like. According to the latest information that I have seen, if you were to lease a 2005 Subaru Outback 3.0 Sedan through Subaru's captive finance company right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00100 and 53%, respectively. The numbers for an otherwise identical 4 year lease should be .00120 and 44%.

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CarMan@Edmunds · January 2005

No problem, seacarfan. Thanks for the additional information. Many banks' lease money factors do indeed vary, depending upon what one's credit score is. I always quote lease money factors in this forum that are for banks' top credit tiers. If your credit is not in very good shape many banks will charge a higher lease money factor. Mercedes-Benz currently has a base lease money factor of .00240 for consumers with good credit who lease a 2004 E500 Sedan. If your credit score is high, then the dealer that you are working with is likely trying to mark up this car's base factor to add additional back-end profit to your deal. I would not be surprised if this was the case, Mercedes and BMW dealers mark-up leases all the time.

Let's work up a sample lease payment on this car for you using Mercedes-Benz Credit's base lease program. According to my calculations, if you were to lease a 2004 Mercedes-Benz E500 Sedan with an MSRP of $63,165 and a selling price of $54,995 through MBC right now for 39 months with 10,000 miles per year, your zero down, pre-tax monthly payment should be around $735. The 2005 E500's 39 month 10K residual value is indeed 58% as you were told. The residual for an otherwise identical lease of an '04 model would be 3% lower. As you can see, this payment is a little lower than the one that you were given so either you do not qualify for MBC's top credit tier or there is some other problem.

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CarMan@Edmunds · January 2005

Ruggy, most dealers are actually more willing to discount vehicles that they have on their lots in an effort to turn over their inventory than they are to discount ordered vehicles. So no, ordering your A8 probably will not result in you getting any sort of additional discount on it. I am not intimately familiar with what the market is like for this car in your area, but the price that you were quoted seems fair to me.

Let's work up a lease payment on this car for you and see what we come up with. According to my calculations, if you were to lease a 2005 Audi A8L with an MSRP of $79,820 and a selling price of $76,896 through Audi Financial Services right now for 3 years with 15,000 miles per, your zero down, pre-tax monthly payment should be around $1,047. If the lease payments that you mentioned earlier include tax then they are pretty close to the one that I came up with.

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CarMan@Edmunds · January 2005

You're very welcome, tempnirvana.

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CarMan@Edmunds · January 2005

Greetings roon. I would be happy to give you an idea of what Honda's lease program on the 2005 Odyssey is currently like. However, in order for me to do so I need some additional informaiton from you first, including how long you want to lease this van for and how many miles per year you need to be able to drive it.

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CarMan@Edmunds · January 2005

Dawnf, while some banks will occasionally negotiate the lease-end purchase prices of vehicles most banks will not negotiate the selling prices of leased vehicles that lessees attempt to purchase well before the scheduled end of their contract. Whatever you do, do not involve your dealer in your attempt to purchase your leased vehicle. They have nothing to do with it, other than perhaps trying to add a little profit to the transaction for themselves. This matter is completely between you and the bank that you are leasing your car through. Place a call to Toyota Financial Services, or whichever bank you are leasing your Camry through, to find out exactly how much money it would cost you to buy at this time.

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CarMan@Edmunds · January 2005

It is difficult to say, euza, how close the residual values that are available at Edmunds.com are to those that are used by SE Toyota Finance to calculate leases because I have not seen the latter's program. If I had to make an educated guess, I would say that SET Finance's residual values are probably a couple of points higher, but again this is just an educated guess.

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CarMan@Edmunds · January 2005

You're very welcome, planoman. I am glad that I was able to help you out.

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CarMan@Edmunds · January 2005

No problem jim53. BMW used to have a great multiple security deposit program, allowing something like up to ten deposits with each additional one providing a .00010 reduction in vehicles' lease money factors. It has since cut back on this program, reducing the number of deposits that can be made to five and the reduction for each to something like .00005. You need to speak with your dealer to find out the exact parameters of this program.

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CarMan@Edmunds · January 2005

You're welcome, SFCharlie. You may be able to find out more information on what this car's lease program was like in September by scrolling back through the posts in this discussion to that time period if you are interested.

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CarMan@Edmunds · January 2005

Paul, AHFC's residual values for the Accord do vary by trim level, but its resids for the 2005 Accord EX and LX 4-cylinder appear to be the same at this time.

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CarMan@Edmunds · January 2005

I am glad that I was able to help you out, Paul. Thanks for offering to stop back and let us all know how everything turns out.

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CarMan@Edmunds · January 2005

No problem, Ernest. Let me know if you have any other questions.

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CarMan@Edmunds · January 2005

Hi scott31. Volvo is currently providing $1,500 dealer cash on the 2005 S40 T5 AWD. You would use this cash if you were to pay cash for or finance this car. It is providing $2,500 cash on leases of this car through banks other than Volvo Finance in January. Unfortunately, I do not keep tabs on the lease programs that are being offered by independent banks, only the ones that are available through manufacturers' captive finance companies. If I was in your situation, I would calculate how much it would cost to lease this car through Volvo Finance right now and see if the dealer that you are working with can beat that payment by using the $2,500 as a capitalized cost reduction and running its lease through an independent bank. If you were to lease a 2005 Volvo S40 T5 AWD through Volvo Finance right now for 36 months with 15,000 miles per year, its base lease money factor and residual value should be .00185 and 51%, respectively. The numbers for an otherwise identical 39 month lease should be .00185 and 48%.

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CarMan@Edmunds · January 2005

Hey lycanthris. Here is the informaiton that you are looking for. If your girlfriend was to lease a 2005 Mazda 3s Sedan through Mazda Credit right now for 2 years with 12,000 miles per, its base lease money factor and residual value should be .00094 and 58%, respectively. The numbers for an otherwise identical 36 month lease should be .00079 and 48%. Using these numbers, an MSRP of $21,160, and a selling price of $20,000, I estimate that this car would have a zero down, pre-tax two year lease payment of $353 and a three year payment of around $298.

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CarMan@Edmunds · January 2005

Hi tcmotorcity. The percentages that I mentioned earlier are correct. The problem is that Toyota Financial Services does not allow the full residualization of a lot of options. Unlike the residual value percentages that are based upon the full MSRPs of vehicles plus the full MSRPs of any options that most banks use, TFS' residual value percentages are based upon vehicles' base MSRPs. They have less attractive hard adds for certain options. This often makes vehicles a little more expensive to lease through TFS than they would have been had they been leased through a different captive finance company.

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CarMan@Edmunds · January 2005

Jim53, BMW's current lease program is only scheduled to run through January 31st. It is difficult to say what its new February lease program will be like at this time. Please feel free to check with me late that week and I will be more than happy to fill you in on what I have been able to find out about its new program.

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CarMan@Edmunds · January 2005

Hey Marissa. Most manufacturers' customer cash incentives can not be used in conjunction with their special lease programs. Some automakers offer different lease cash allowances though. The $1,500 customer cash that is currently available on the 2005 Nissan Altima cannot be used in conjunction wit leases through Nissan Motor Acceptance Corp.

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CarMan@Edmunds · January 2005

It is difficult to say how many miles per year you will drive, jbaer. From the sound of it, you probably only need a 12,000 miles per year lease. However, if you think that you may drive more than that it is much less expensive to lease a vehicle with 15,000 miles per year than it is to have to pay a large lease-end penalty for excess mileage. While it is nice to have the lower payment that a 12,000 miles per year lease will provide, nothing is more annoying than having a leased vehicle and not wanting to drive anywhere because you are at or near your mileage limit.

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CarMan@Edmunds · January 2005

You're welcome, dawnied. In many regions, Toyota Financial Services' special lease money factor for the 2005 4Runner is currently .00131 for up to 36 months for consumers who qualify for its Tier 1 credit tier. I have not seen its specific lease programs for this truck in the San Francisco or Los Angeles regions though, which leads me to believe that the aforementioned money factor may not be available in those areas. If that is indeed the case and you were to lease this truck through Toyota Financial Services, you would have to use its standard lease money factor. The last time that I saw its standard factor, it was .00225 for consumers with credit scores in the high 600's to low 700's and .00215 for consumers with scores of 730+.

You can get an approximate interest rate equivalent for a lease money factor by multiplying it by 2400.

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mellie007 · January 2005

I am interested in a lease, but have never done so and am not quite sure how to start. Can I trade my own car in to use as a down payment? Are there really leases where you are not required to put any money down? I am interested in a special lease offer from Nissan for the Pathfinder SE. It states $1999 down for 39 months and monthly payments of $319. Is that a good offer? Can you add options such as a DVD entertainment system and if so, how much would that increase monthly payments? Is a lease a good idea for a family car that is only driven to school and an occasional out of town trip?

smile41 · January 2005

My husband recently passed away and I am left with a Nissan lease with 13 months left on it. My name is not on the actual lease - what are my options? I am being told by the lease company that the estate is now responsible for the remaining payments. Is there any way out of this?????

tonyh · January 2005

Thanks for the info Car_Man.

roon · January 2005

Thanks - we are thinking 36 mo, 12 K

jbaer · January 2005

Thanks for the responses. Car_man how much more is it a month to go from 12k to 15k lease in general? This would be for a honda accord and honda pilot? Somebody had mentioned ~20$ a month? Do they just use a lower residual to take into account the extra miles? If so how does this effect the residual on a 36month lease for either car. Thanks again.

kyfdx · January 2005

Exactly.. 2% lower residual..

$30K car.. X 2% equals $600/36mo. = $16.67/mo. + tax.. minus maybe a dollar in finance charge because of the lower residual.. So, probably closer to $17/mo. than $20..

regards,

kyfdx

jbaer · January 2005

One of the edmunds articles about leasing said that miles over your lease is usually between 10-15 cents a mile. For 3000k miles this would be at most $450 which if divided by 36 would only be $12.5 month rather then the $17-20 that you mentioned. What am I not getting here? Thanks in advance.

kyfdx · January 2005

3K miles per year... 9K miles over the term of the lease... 36K vs. 45K

9K miles X $0.15 = $1350/36 months = $37.50/mo.

Easy mistake to make.. I do it all the time..

regards,

kyfdx

If $0.10/mile, then $25/mo.

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