Lease Questions - Ask Here

santeewoody · March 2005

Hi Car_man,

Thanks you for being here. We all very much appreciate the insight. To make a long story short I have an order in for a 2005 Lexus RX330 AWD with Navigation.
They have quoted me a purchase price of $41,000
They have offered me the following 36 mos lease with 18K of miles allowance per year.
Monthly payment of 632.07+ 48.99 of tax (7.75)

Specifics
MSRP 44925.00
Purchase Price $41000
Money Factor .00175
Residual Value at end of lease of $22909.52 - 51%

Drive off fees of $1070.30
35 mos of 632.07+tax

What do you think of the deal. I am not understanding the calculations. Any comments on it?
Also they say that the vehicle I want is a difficult one to get ( Flint Mica with Black Leather) so they need to order it and it should be here in 3 to 4 weeks. They will need to put it in their dealer allocation. Does this sound approperiate also?

Jim

pa32tl1 · March 2005

Carman,
I am looking to purchase a 2005 Lexus RX330 with Premium Plus Package, Heated Seats, 18 inch wheels. Total MSRP is $42600, selling price is $37995. What kind of lease payment could I get for 39 months, 15,000 miles per year, and about $3500 out of pocket? Thanks in advance.

mssmiles · March 2005

Thank you for the response, car_man! Since first posting here, I have been reading the other posts, and I feel like I have learnt a lot in general from them and from your responses.
As far as the SUV I am interested in leasing is concerned, I will try to give you as many details as I can:
Highlander Ltd. AWD with 3rd row seat with options LL, NV, VV, EJ, LA, HD, GY and TO
MSRP: 37555
Selling Price: 34701
Residual value: 20200
Money Factor: 0.0012
Destination charge (what's that?): approx. 450
Acquisition fee (what's that?): can't remember the price quoted.
0 down, no security deposit, only 1st month's lease payment up front.
36 months/45k
I live in Michigan, sales tax 6%.
Dealer quoted me 533/month tax inclusive, and will take care of 2 remaining lease payments - 470/month - on old Highlander lease from same dealer (38.5k mileage on 45k lease with just over 2 months left)
My questions are:
1. Is the selling price good or should I negotiate some more?
2. Is 533/month a good deal under the above circumstances?
3. If not, then what, in your opinion, would be a good/great deal - how much a month? I am willing to pay the remaining 2 lease payments my self if that improves my chances of getting a great deal on the new one!
I hope you have all the info you need to be able to respond.
Look forward to your response.

paulsaz · March 2005

Does anybody know the current offers on the S40? I don't see any rebates listed on Edmunds, or any Volvo to dealer cash. I have heard that they are still offering the 1800, but cannot get confirmation on this. Also I am pretty sure I can get the 1250 cash for current Volvo leases. My lease on my 2001 S40 is up next month. Cars direct has a price on the S40 2.4i, auto, select, metallic for around 25,500. Can you also give me the residual and money factor for both the 2.4i and T5 turbo? I am hoping for a zero out of pocket deal, or at least no down payment.

corral · March 2005

Lease guy, what are the current programs for a 2005 infinit g35X 36 or 39 month 12k per year, money factor and residual percent. The cadillac program with gmac, is there any lease cash or rebates and the residual for the same term. Also is gmac done by apr? or money factor?

Thanks

lovebmw330i · March 2005

Thanks for all the helpful info! I wanted your opinion on prepaying a lease since I have some extra cash at this point and I don't want to have to worry about the monthly payments. Also, here is the quote I got for a 2005 BMW 330i w/automatic and sports package from a South Florida BMW dealership:
1 payment of $17,500 including everything
36months/12k miles/year
works out to $485/month tax included
Is this a good price?
Thanks,
Mike

CarMan@Edmunds · March 2005

Thanks for the additional information, arnoldm. Let's work up a couple of lease payments for you. According to my calculations, if you were to lease a 2005 Lexus ES 330 without navigation, with an MSRP of $37,125 and a selling price of $31,350 through Lexus Financial Services this month for 3 years with 12,000 miles per, your zero down, pre-tax monthly payment should be around $350.

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CarMan@Edmunds · March 2005

Hi John. In order for me to give you an idea of what these cars' lease programs are like, I need you to tell me how long you want to lease them for and how many miles per year you need to be able to drive them.

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CarMan@Edmunds · March 2005

Here is the info that you are looking for, tsb. If you were to lease a 2005 Toyota 4Runner Sport 4WD through Toyota Financial Services in its New York region right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00131 and 62%, respectively for Tier 1 customers.

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CarMan@Edmunds · March 2005

Ah ha, I see that you provided the necessary informaiton in a later post, John. OK, let's take a look at these cars' lease programs. If you were to lease a 2005.5 Audi A4 2.0T Sedan with quattro through Audi Financial Services right now for 36 months with 15,000 miles per year, its base lease money factor and residual value should be .00135 and 56%. This car's 39 month program is .00155 and 53%. Its 12,000 miles per year residual values are 2% higher than its 15,000 miles per year residuals.

If you were to lease a 2005 Acura TSX without navigation through American Honda Finance Corp. right now for 36 months with 15,000 miles per year, its base lease money factor and residual value should be .00220 and 58%, respectively. This car's 39 month program is .00220 and 54%. Again, its 12,000 miles per year residual value are 2% higher than its 15,000 miles per residuals.

Lastly, if you were to lease a 2005 Volvo S40 T5 AWD through Volvo Finance right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00185 and 51%, respectively. Its 39 month numbers should be .00185 and 48%. Again, its 12,000 miles per year residual value are 2% higher than its 15,000 miles per residuals.

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CarMan@Edmunds · March 2005

You're welcome, ktkat. I am not aware of any place where you can get documentation stating what this car's lease money factor currently is. I can tell you though that this number that I provided you is definitely right and this dealer definitely knows that this is the case. If they continued to lie to me, even after I had the correct information I personally would be hesitant to do business with them.

Another problem that I had with this deal is the $1,000 down payment. If this money is not being used as a capitalized cost reduction, but is to just cover things like the lease acquisition fee, and other minor charges, it is fine. I always advise consumers against making any sort of cap cost reduction when leasing. I do so for two main reasons. The first is if your vehicle is totaled in an accident or stolen during your lease, your insurance company pays off the bank that you were leasing it through and your down payment essentially disappears. The second main reason is that down payments on leased vehicles do nothing to reduce their lease-end purchase prices. So your lease-end purchase option price for this car would be exactly the same, regardless of whether you had put $1,000 down, or had made absolutely no down payment at all.

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CarMan@Edmunds · March 2005

No problem, Gerry. Make sure to let us know how everything turns out.

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CarMan@Edmunds · March 2005

Hello Hong. Unfortunately, banks still charge interest in pre-paid leases. They do provide a discount in the lease money factor, or interest rate, that is used to calculate the interest portion of leases that are paid in advance though.

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CarMan@Edmunds · March 2005

Greetings dwynne. I am sorry to say that the dealer cash that Volvo is providing on the models that you are interested in is not compatible with Volvo Finance's special lease program.

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CarMan@Edmunds · March 2005

You're welcome, coffee_fan. If you were to lease a 2005 Saab 9-5 Arc Wagon through Saab Financial Services Corp. right now for 3 years with 12,000 miles per, its base lease money factor and residual value should interestingly enough be .00048 and 48%, respectively. It also has $3,000 lease cash on this model.

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CarMan@Edmunds · March 2005

Hi addi. The last time that I saw it, Toyota Financial Services' residual value for a 3 year, 15,000 miles per lease of a 2005 Prius was 53%.

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CarMan@Edmunds · March 2005

You're welcome, tomtaks. Yes, a number of manufacturers have fairly attractive lease programs on vehicles right now.

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lmacmil · March 2005

"I always advise consumers against making any sort of cap cost reduction when leasing... if your vehicle is totaled in an accident or stolen during your lease, your insurance company pays off the bank that you were leasing it through and your down payment essentially disappears."

That's true but as you get further and further into the lease period, the less you would lose because you're cap cost reduction has reduced your monthly payment. It's not a good idea in theory but in the vast majority of leases, the vehicle never gets totalled or stolen.

CarMan@Edmunds · March 2005

No problem, selm. I'll talk to you then.

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CarMan@Edmunds · March 2005

You're very welcome, carnaught.

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CarMan@Edmunds · March 2005

Hey jbaer. I wouldn't worry too much about General Motors selling Saab. It has already said that those rumors are not true. It has a number of future products in the pipeline for Saab, including the new 9-7X. I don't think that Saab's sales will improve any time in the near future, but I personally do not think that General Motors will sell them either. Besides, who would buy them? If anything, GM would probably just close the division, like they did with Oldsmobile. In the unlikely event that that did happen, you would be able to take your Saab to any General Motors dealer for repairs.

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CarMan@Edmunds · March 2005

No problem, cpeterson3. I am glad that I was able to help you out.

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skinnydog · March 2005

Car_man, thanks for the information. One last thing, do you know if there are any incentives etc on the s40 T5 AWD? I'm pretty sure there are some on other models, but not sure about this one.

Also, my mileage is expected to be right in between 12K and 15K. Would I be better off getting a 12K lease and prepaying for another 1500 miles per year (4500 total over 3 years) or going with a 15K lease.

Thanks.

addi · March 2005

Car_Man,

Thanks much for the residual.

vogte69 · March 2005

Hello,
I am interested in leasing the 2005 Murano S AWD.
I hate the whole game with car dealers. I'm no good at it, and I usually end up walking out frustrated.
My question is how do I know if I'm getting the best deal on a lease if they continually come back at me dropping the number?
I started with $1000 down for a 42 month lease with 15K per year. They started with $391+tax per month. I told them I need to be in a prices range of $275+tax. They finally came down to $300+tax but at that point it had been 2 hours of this nonsense. How do I know how low I can go? Is my price for this car unreasonable?
I would be trading in my 2003 VW Jetta GL with 31,500 miles. I owe $12,300 and it is valued at about $10,500.
Any help from you would HUGELY appreciated.
Thank you
elv

auburn97 · March 2005

Is there a good website that lists lease incentives for all manufacturers/models? Thanks.

outlandr23 · March 2005

Hello Carman -

I've learned a lot reading your posts, so thanks in advance for your help! This will be my first lease and I currently have an offer from an Infiniti dealership, that I would like your help with.

2005 G35 RWD Sedan, trunk mat and splashguard
MSRP: 32,470
selling price: 30,600 (cap cost)
MF: .00234
Residual: 60%

36 months, 15,000/yr

I'm trading my 03 which they're giving me $1685 in equity on. This will cover first month payment, destination, and fees. (I might just sell it to carmax and pocket the difference; I recognize using a downpayment for cap cost reduction isn't a good idea) Nothing additional down, payment $409.62 .

How does this look to you?

I'm also trying to find a deal on a TL to compare (torn between the two cars), but having a hard time getting terms anywhere close to in-line.

Thanks in advance!

cgrad · March 2005

hello, carman

I just graduated from college and I am looking to get a new car. Should I lease or purchase?

corral · March 2005

Lease guy, thanks for answering so many ?'s. Now all of my coworkers and friends are leasing their cars. I have a ? about nissan tiatn le and se crew cab on a 36 month 45000 mile lease. What is the residual and moneyfactor. I hate to be pushy but could you please tell me on 2wd and 4wd.

Many thanks

oaktons11 · March 2005

Here is the offer I have right now. This is an EX-L with DVD. I am in the Cleveland area.
MSRP: $34335
Offer: $30536
What will the lease payments be for 36mo with 12K miles per year?

Thanks

CarMan@Edmunds · March 2005

You're very welcome, funky1020. You can get the best deal possible on the new X3 that you are interested in by shopping around and getting an attractive selling price and then having the dealer that gives you that price calculate this truck's lease payment using BMW Financial Services' base lease program.

At lease signing, you will have to pay this truck's first month's lease payment, a security deposit equivalent to that payment rounded up to the nearest $50 increment, BMW FS' lease acquisition fee of $900 (this fee is higher than normal because you live in New York), and any necessary taxes.

BMW is not currently providing any dealer cash on the X3.

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CarMan@Edmunds · March 2005

OK, jimbojones, let's calculate 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 Nissan Altima 3.5 SL with an MSRP of $28,940 and a selling price of $26,940 through Nissan Motor Acceptance Corp. right now for 3 years with 15,000 miles per, your zero down, pre-tax monthly payment should be around $345. You would be better off leasing this car for 39 months instead of for 36 months. Doing so would drop its monthly payment to around $322. If you need to drive this car more than 15,000 miles per year, you will have to purchase additional miles on a per-mile basis.

If you need to trade in your current vehicle, you certainly can do so, but treat it as a separate deal. If your 626 is worth more than you owe on it, have the dealer that you are leasing your new vehicle from cut you a check for the difference. If you are upside down on it, meaning that you owe more money than it is worth, you should be able to roll some of your negative equity over into your new lease or pay the difference out of your own pocket.

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CarMan@Edmunds · March 2005

Thanks for the additional information, rp0913. Let's calculate a sample lease payment on this truck for you. According to my calculations, if you were to lease a 2005 Jeep Grand Cherokee Laredo 4WD with an MSRP of $33,640 and a selling price of $29,817 through Chrysler Financial right now for 39 months with 15,000 miles per year, your zero down, pre-tax monthly payment should be around $429 or so.

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paulsaz · March 2005

I was wondering if you had a chance to check on the S40 info for the 2.4i and T5 2wd I asked about in post #17693? Sorry if I missed your answer, there are alot deals going on here.

Paul

andyhiggs · March 2005

Hey Car_man, I was wondering what the money factor and residual is right now on a 2005 Honda Accord Coupe EX-L without NAV? If it matters, I'm in Kansas City and am looking for a 36 month lease with 12,000 miles. Thanks a lot.

auburn97 · March 2005

2005 Murano SL base 42-month lease
$299/mo plus 3.25%tax ($308.72 per month total)
$999 down ($700 ccr + $299 first payment)
no security deposit

Basically, I told the dealer what I wanted to pay on a lease, and he was able to knock net cap cost by $1,000.

scott31 · March 2005

Car_Man, sorry to bug you YET again :-)

I need 3yr/12k MF and Res % on

Acura TL 6-speed w/Nav
Acura TSX 6-speed w/Nav
Acura MDX w/Nav

Thanks!

arnoldm · March 2005

car_man....good info...what would it cost if we went to 15,000 mi per yr?....and you mention this month....is there a lexus deal for March?...again thanx...arnoldm

prisch · March 2005

Car_Man,

I have my own A4 quotes requested in a separate post, but this caught my eye.

My dealer tells me the .00135 MF is only available with a security deposit, but I didn't see you mention it. Is my dealer giving me accurate information or marking it up a bit?

mikey5 · March 2005

Car_man thanks for the reply and assistance.
The selling price on the car was around $33,300.

Appreciate it.

markrogo · March 2005

I'm looking for any speculation on residuals and money factor on the soon-to-be-released 400h with

3 and 4 year... 12 and 15K miles...

Thanks for any help out there.

ajpbf7 · March 2005

Hello Carman,

Could you provide mw with the following MF& residuals:

05 Honda S2000 42 months 12K
05 Acura RSX-S 36 months 12K
05 BMW Z4 2.5i 36&39 months 10K
05 Ford Mustang GT 36 months 12K

Thank you for your help, I appreciate it.

mond · March 2005

I ordered a Z4 3.0 on their lease program. I signed the deal and gave the full up front 1st month, bank fee etc. to close the deal yesterday. The price included the $4500 BMW incentive. I did this at a dealership fully OWNED by BMW, not a franchise.
The soonest they can deliver the car is 4 to 8 weeks. They call me today to tell me that BMW informed them they can't honor the deal because the $4500 expires on 3/31. If it gets continued in April they will honor the deal. According to BMW, if you sign a lease and they order the car the price is based on when you sign the deal no matter when they can deliver it. In this case they are saying they have an out on the incentive and won't honor the deal. Why is it my problem they can't deliver the car soon enough after I gave them my money? What should I do to stop their taking my money and then giving me double talk? Thanks

carbert · March 2005

Is there a good website that lists lease incentives for all manufacturers/models? Thanks.

There is a site called edmunds.com. Maybe you've heard of it?

Go to the home page, click on 'New Cars' Then, click on 'Incentives & Rebates, in the row underneath 'New Cars'. Enter your zip code because incentives vary by area.

cosmos2 · March 2005

A Carman,
I am back Should you have to pay tax of 78.75 on the acquisition fee of 900 dollars which they call the bank fee. Also does that get subtracted from the selling price of the car. I am really trying to understand how the actual numbers come out . Could you show us a sample calculation of how a consumer could figure out .

Thanks again
Cosmos2

CarMan@Edmunds · March 2005

Hi drowningleasee. I am sorry to hear that you are so far over your vehicle's mileage limit. The only way that you can avoid having to pay a substantial excess mileage penalty is to purchase your vehicle at lease-end. This option only makes sense if you are less upside down on your car than your excess mileage penalty will cost you. In order to determine whether you should purchase your vehicle at the end of your lease, you need to compare its purchase price to its value on the open market at this time. Even though it states your car or truck's purchase option price on your lease contract, you should place a call to the bank that you are leasing it through just to make sure that you have the correct figure. When you do so, it never hurts to try to haggle with them. Some banks will negotiate the lease-end purchase prices of vehicles. If your initial contact at your bank is not willing to lower your vehicle's purchase price, you may have better luck if you work your way up the ladder to a manager. There is a good chance that they will not lower your vehicle's price, more often than not they will not, but you don't have anything to lose by asking.

As I said earlier, 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. If the difference between what you owe on your car and its current market value is less than your excess mileage penalty would be, you may want to consider purchasing your Eclipse.

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CarMan@Edmunds · March 2005

Hi jaye28. The selling prices of leased vehicles are always negotiable. The advertised lease payment that you saw on the X3 assumes a specific discount by dealers. Manufacturers' advertised lease payments often leave a little meat on the bone so to speak. It makes sense if you think about it. Dealers would be pretty irritated if their manufacturer advertised the lowest possible price for a car or truck. As a result, if you are in an area where there is a decent level of competition for your business and you comparison shop a little bit, you should be able to lease the X3 that you are interested in for a little less than its advertised payment. If you let me know the full MSRP of this truck that you are interested in, what sort of selling price you expect, how long you want to lease it for, and how many miles per year you need to be able to drive it I would be more than happy to calculate a sample lease payment for you.

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CarMan@Edmunds · March 2005

Hey prisch. Here is the information that you are looking for. If you were to lease a 2005 Audi A4 2.0 Sedan with quattro through Audi Financial Services right now for 3 years with 10,000 miles per, its base lease money factor and residual value should be .00135 and 59%, respectively. The numbers for an otherwise identical lease of a 2005 Audi A4 3.2 Sedan should be .00135 and 56%.

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CarMan@Edmunds · March 2005

You're very welcome, Jim. The first thing that I noticed about this deal is that the lease money factor that you were quoted is a little high. Lexus Financial Services' base lease money factor for the 2005 RX 330 is .00145, .00155 if you have its security deposit waived. Your purchase price looks fine though.

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CarMan@Edmunds · March 2005

Let's work up a sample lease payment for you, pa32tl1, and see what we come up with. According to my calculations, if you were to lease a 2005 Lexus RX 330 4WD without navigation or the rear entertainment system, with an MSRP of $42,600 and a selling price of $37,995 through Lexus Financial Services right now for 39 months with 15,000 miles per year, your zero down, pre-tax monthly payment should be around $484. With this lease, at lease signing you would have to pay this truck's first month's payment, a security deposit of $500, Lexus Financial Services' lease acquisition fee of $600 (its higher in New York), and any other necessary taxes or fees.

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