Lease Questions - Ask Here

CarMan@Edmunds · March 2005

No problem, mssmiles. Vehicles' destination charges are the levied by manufacturers to help pay for the cost of transporting them from the factory to dealers. This charge is essentially part of vehicles' prices and is not negotiable. All banks that lease vehicles to consumers charge a lease acquisition fee. Toyota Financial Services specifically charges an acquisition fee of $400 on leases. This money goes directly to TFS and individual dealers do not have the authority to waive it.

The selling price that you were quoted for this truck looks reasonable to me, but I am not intimately familiar with what the market for the 2005 Highlander is like in your area. You may want to stop by the following discussion for additional feedback on Highlander pricing: "Toyota Highlander: Prices Paid & Buying Experience". Having the dealer make your final two payments on your existing lease for you is hampering your ability to get the lowest possible lease payment on your new truck. It would be in your best interest not to roll any of your remaining lease payments into your new deal. The lease money factor and residual value that you were quoted look about right to me. As long as you are sure that you are getting the lowest possible selling price for this truck, you can move forward with this deal.

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CarMan@Edmunds · March 2005

Greetings paulsaz. Volvo is providing dealer cash on the 2005 V40 this month. Specifically, it is giving dealers $1,500 dealer cash on 2005 S40 2.4i and $1,850 on S40 T5 models. Having said this, the dealer cash can not be used in conjunction with Volvo Finance's special lease program. The $1250 owner loyalty cash for current Volvo lessees whose deals are scheduled to expire may be used in conjunction with this lease program though. I would be more than happy to give you an idea of what this car's current lease program is like, however in order for me to do so, I need you to tell me how long you want to lease it for and how many miles per year you need to be able to drive it.

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CarMan@Edmunds · March 2005

Here is the information that you are looking for, corral. If you were to lease a 2005 Infiniti G35 AWD Sedan through Infiniti Financial Services right now for 36 months with 12,000 miles per year, its base lease money factor and residual value should be .00172 and 59%, respectively. The numbers for an otherwise identical 39 month lease of this car should be .00172 and 58%.

As you already seem to be aware, GMAC publishes what are known as lease rates rather than money factors for vehicles. You can convert its lease rates into approximate money factor equivalents by dividing them by 2400. If you were to lease a 2005 Cadillac CTS (not the CTS-V) through GMAC right now for 36 months with 12,000 miles per year, its base lease rate and residual value should be 3.95% and 54%. GM also has lease cash and bonus cash on this car. The exact amounts vary depending upon what area you are in. If you let me know what city and state you are near I can tell you exactly what sort of cash to expect.

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CarMan@Edmunds · March 2005

You're welcome, Mike. In order for me to tell if this is a good deal, I need you to provide me with this car's full MSRP and selling price.

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exoman1 · March 2005

Hi Car Man: I've never leased a vehicle before and need some feedback on whether the following is a good deal:

MSRP on 4Runner SR5 = Approx. $32,200
36 month / 45K miles: $358.11 (tax inclusive)
Inception: $971 which includes first payment
Residual = $19,600
Out of Pocket = $13,504.85

I think I may be leaving $ on the table since Toyota has $900 customer cash this month. Think I should be able to do better than above?

prisch · March 2005

Thanks so much Car_man, I'm going to order the 2.0 Q today I think--getting $1000 off MSRP which I think is fair on such a new car.

One question that I posted somewhere else, on the base MF of .00135-is that with or without a security deposit? My dealer told me it's only with a security deposit and it's .00155 without--just want to make sure he's being honest with me. Thanks again for all your work and help.

429 · March 2005

Car Man -

Can you give me the latest residual and money factor numbers for an '05 Odyssey EX (cloth) lease in the vicinity of 36 months?

Honda's money factors seem to be on the downward trend over the last few months as Sienna gives them a run for their money (a van we are also considering). Are they offering any good deals now or rumored to in the future?

Thanks-
429

go8 · March 2005

Car_man,

Would you please let me know/confirm what is the lease support provided by GM/Saab for the 9-3 in the Northeast (NJ). I have 1000 GM plus 2500 Saab total 3500. I recently leased a 9-3. We started with invoice and he took off the 3500 plus another 200. How did the dealer make money? Am I missing something?

Go8

paulsaz · March 2005

Thanks for the reply. I am looking at both 36 and 48 month lease. 12,000 miles is plenty. I only put 30,000 miles on my current 48 month lease that expires next month. I am looking at a 2.4i with auto and select.

lovebmw330i · March 2005

Car man the MSRP is $38,500 I don't know what the selling price is since I didn't negotiate based on the selling price but on the total cost of the lease. Also,if I do prepay the entire lease and 6 months from now the car is stolen or totaled do I lose my remaining cash?
Thanks!!

pa32tl1 · March 2005

Carman,
Thank you for your reply. Would a cap cost reduction of about $2000 on the Lexus reduce my payment significantly?
I am also considering the 2005 Toyota 4Runner Limited V8 with an MSRP of $41300, and a selling price of $37900. Using the same factors, what the lease payment be on this vehicle? Thank you in advance for your help.

CarMan@Edmunds · March 2005

You're welcome, skinnydog. Volvo is providing $1,850 dealer cash on the 2005 S40 T5, but this cash is not compatible with Volvo Finance's lease program. Usually banks do not allow consumers who lease vehicles with 12,000 miles per year, to purchase additional additional miles on a per-mile basis. Consumers who feel as though they need more than 12,000 miles per year usually just have to lease with 15,000 miles per.

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CarMan@Edmunds · March 2005

No problem, Addi.

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CarMan@Edmunds · March 2005

Hi vogte69. It sounds like you are new to the world of leasing. If that is the case, you should check out the following informative articles that are available here at Edmunds.com: 10 Steps to Leasing a New Car and Calculate Your Own Lease Payment. The most important numbers to focus on when leasing are the selling price of the vehicle that you are interested in and the money factor that is being used to calculate its lease payment. These are the two main areas that dealers profit from on leased vehicles. Negotiate the selling price of the Murano that you want, just as if you were paying cash for it. You may want to do some research here at Edmunds.com to see approximately how much you should pay for it prior to going back to your dealer. Once you have established a reasonable selling price, make sure that your monthly lease payment is being calculated using Nissan Motor Acceptance Corp.'s base lease program for this model. Right now NMAC's base lease money factor and residual value for a 42 month, 15,000 miles per year lease of a 2005 Murano S AWD are .00118 and 60%, respectively. It appears as though you are trading in a vehicle that is worth less than you currently owe on it. Ideally, you would pay the difference between what you owe on your trade and what the dealer will give you for it out of your own pocket to avoid paying interest on it, but you should be able to roll at lease part of your negative equity into your Murano lease if you want.

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deeb · March 2005

Do you get to use the cash incentive when leasing a car?

I am currently looking at a Nissan Altima 2.5S with the F01 and T01 options. The Edmunds site lists the MSRP as $22,760 and it says that others (in my area of Albany, NY) are buying it for $21,156. I saw that there is a $1,500 incentive for this car. So, if I were to try to figure out the monthly lease cost, could I use $21,156 (what athers are paying ) MINUS $1,500 (the incentive) as the "invoice price" in the calculation of the lease?

If I were to add all expenses into the lease (aquistion fee, doc and registration fee, sales tax at 8.25% and first month's rent), does this total get the money factor applied to it?

If my assumptions above are true, and I use your previous info on money factor and residual (.00127, 59 percent, $22,760 MSRP, $19,869 invoice), that would come out to be a monthly price of $221.19. If I add in the costs and apply the money factor to the costs, it looks like the monthly price would be $269.79.

Have I done this correctly?

mssmiles · March 2005

Thank you, Car_man! You're the best!!!

brickyarddog · March 2005

Car_man,

Thanks for the information on the Honda Pilot. Now, however, you've intrigued me by mentioning the good deals on the Accord and Altima. Can you give me MF's and residuals for the following, and I promise I'll be done asking questions. All leases are 12K miles and 36 mos.
Accord LX 4cyl, Accord EX V6, Altima 2.5S, Altima 3.5SE, and when do the current Nissan lease deals expire?

Thanks again for all of your help.

nickmo · March 2005

Car_Man:

A few weeks ago you ran the numbers for me for a Mini S Convertible. I was happy with that but then test drove and loved the Z4 2.5 even more. The numbers they crunched for me look great, what do you think:

monthly payment: $476.78 (including 10% tax in Philadelphia)
MSRP: $37,120 (auto, cloth seats)
10k/month 36 months
$0 down
$1135.28 due at signing (first, tags and sec. dep)

I want to pull the trigger on this one, is there any more haggle room? the dealer told me this included the March $2500 in dealer incentives. i looked on her screen and she had a money factor of .002 and residual of .59

pa32tl1 · March 2005

Carman,
The Lexus dealer just advised me that the MF is .00135, and the residual is 56%. Would that increase or decrease that price quote of $484 per month with $2000 cap cost reduction? Thanks.

dawnp1 · March 2005

I am looking at a new '04 Pilot EXL w/ RES for 28,500 (+ Tax 7.25%, Lic & doc). Honda is currently offering Pilot lease of 36 mos. $279.00 mo. $2873 due at signing(1st pymt, security deposit, cap.cost reduction(1999.00)& AHFC up front acquisition fee. This is based on a Pilot EX which the website shows base cost of $30,120. My point is, if I can get the '04 for $28,500, can I improve on this lease offer? What would be a good deal? Although I drive approx. 17,00 miles annually, I intend to buy this car at the end of the lease term. I will appreciate any help and advise! Thanks.

catheryn2 · March 2005

When is it a better deal to buy a car rather than lease. The Mercedes I want is the clk500 cab, but the money factor through mb credit is high,.00310. The residual is also high, 61%. But I am spending a lot of money to rent a car,($37,000). Am I better off buying this car at $65,000?

jimbojones · March 2005

Thanks Car Man!! Looks like the deal is a little better than I thought as I visited the dealership and saw that the vehicle I want is a 3.5 SE (not an SL) model with various options that take the MSRP to $28,920 and the selling price at $24,442 for internet customers.

What are the money factors and residuals on the Altima SE 3.5?? Do I need that info when I am ready to sign the papaerwork???

jmpellet · March 2005

Help! I have never considered a lease but due to the circumstances of losing my great 1999 maxima in an accident, I want to lease a car for a short term and low payments.

A dealer in my area (boston) is offering an Altima 2.5 S for $0 down lease for $159 pre-tax with 12k per year. I will not keep the car after the 24 mo lease so do I care about the money factor and residual? Is this a good deal?

Because it is $0 down does that mean that there is no acquisition fee? Lastly, when they say before taxes does that mean sales and property? How do they determine property (or excise) tax if you don't own the car?

I appreciate any and all answers from this newbie!

steine13 · March 2005

The deal is so good that I don't believe it.
There is a hitch here somewhere. $159/month with a MF of "0" is $3816 of depreciation.
The car has a sticker of at least $20, talking round numbers... and with incentives, a TMV of 17.... $17-4 is $13 residual, which is 65%.... Hmm. I guess there is an outside chance it's real.

I still dont' buy it, but if you can get it, go for it. I don't think you could even drive a used car of that size and quality for that kind of money.

-Mathias

tsb · March 2005

Thank you very much for the information.

jmpellet · March 2005

This dealer is also offering the same vehicle for a purchase price of 15.9k, which is real as others have posted on the Altima board that they purchased it for that amount -- so do you use that amount? Does no money down mean really no $ or will they expect an acquisition fee? The ad does say:

"Tax, title & reg additional. Extra charges may apply at lease end."

I called and asked about the charges at the lease end and was told that mileage overage and damage. I guess if I'm interested I will have to see if it's real. Don't they have disclose this info?

Thanks!

stevern · March 2005

Hi Car_Man,
I am an avid reader of this board and although I am not currently in the market for a lease, you greatly helped me back in June when I negotiated our 04 Honda Odyssey EX-L lease. In fact, the dealer was shocked when I was spitting out MF's & residuals.

I'd like to make a suggestion since there are so many repetitive questions asked (i.e. putting money down, trying to terminate a lease early, etc): my suggestion is to maybe have a "Read First Before Posting" section to address many of the generic leasing questions. I know that you often refer readers to the "10 Steps to Leasing" but it can be difficult to navigate through.

I think that will make reading the Board easier and perhaps save you some time with replying to all the posters. I honestly don't know how you find the time to write back to everyone and to be as comprehensive as you are. Well, that's my suggestion. Keep up the good work. BTW, my Jeep lease is up next March and I'm looking forward to negotiating with the info I've learned from this Board. Thanks, Steve

CarMan@Edmunds · March 2005

Hello outlandr23. I am glad that you have found this discussion so helpful. I am a little confused about what car you are interested in. In the title of your post you mention the G35 Coupe, but in the body you mention the G35 RWD Sedan. Which is it? It makes a difference because Infiniti is providing a little lease support on the Sedan, but none on the Coupe. Let me know and I will give you a thorough evaluation of this deal.

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CarMan@Edmunds · March 2005

Hi cgrad. Congratulations on your recent graduation. There's nothing wrong with leasing your first car after graduating. Many people do this. In fact, a number of automakers have special programs in place that qualify recent grads for their best credit tiers, even though they may not have much credit history. Whether you should lease or not depends upon what the current lease program is like on the vehicle that you are interested in. What sort of car are you looking for? If you give me a general idea, or even better a list of a couple of models I would be more than happy to tell you whether they have attractive lease programs available on them right now.

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CarMan@Edmunds · March 2005

No problem, corral. Here is the latest information that you are looking for. If you, or one of your friends, was to lease a 2005 Nissan Titan Crew Cab LE or SE 2WD through Nissan Motor Acceptance Corp. right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00169 and 52%. The numbers for an otherwise identical lease of an '05 Titan Crew Cab LE or SE 4WD should be .00169 and 55%.

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CarMan@Edmunds · March 2005

Let's work up a sample lease payment on this truck for you, oaktons11, and see what we come up with. According to my calculations, if you were to lease a 2005 Honda Pilot EX-L with DVD with an MSRP of $34,335 and a selling price of $30,536 through American Honda Finance Corp. right now for 3 years with 12,000 miles per, its zero down, pre-tax monthly payment should be around $355.

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CarMan@Edmunds · March 2005

Paulsaz, I already replied to your message. Here is the answer that I posted earlier:

"Greetings paulsaz. Volvo is providing dealer cash on the 2005 V40 this month. Specifically, it is giving dealers $1,500 dealer cash on 2005 S40 2.4i and $1,850 on S40 T5 models. Having said this, the dealer cash can not be used in conjunction with Volvo Finance's special lease program. The $1250 owner loyalty cash for current Volvo lessees whose deals are scheduled to expire may be used in conjunction with this lease program though. I would be more than happy to give you an idea of what this car's current lease program is like, however in order for me to do so, I need you to tell me how long you want to lease it for and how many miles per year you need to be able to drive it."

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CarMan@Edmunds · March 2005

Here is the information that you are looking for, andyhiggs. According to the latest information that I have seen, if you were to lease a 2005 Honda Accord Coupe EX-L without navigation through American Honda Finance Corp. right now for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00113 and 54%, respectively. When negotiating your lease on this car, keep in mind that Honda is currently providing $500 Dealer cash on 2005 Accord Coupes. this cash will help you to negotiate an attractive capitalized cost for your lease.

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CarMan@Edmunds · March 2005

I would be more than happy to give you my opinion on the lease that you were quoted, auburn97. However, you never mentioned the selling price or MSRP of the truck that you are interested in leasing. These are 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 this truck's selling price in relation to its MSRP you don't know how much of a discount you are getting on it. The second reason is that one needs the selling price and MSRP, including the destination charge, of a vehicle to calculate its lease payment. I would be more than happy to work up a sample lease payment on the Murano that you are interested in for you if you let me know what these numbers are.

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CarMan@Edmunds · March 2005

Don't worry about it, scott31. Here is the latest info that you are looking for. According to the latest information that I have seen, if you were to lease a 2005 Acura TL w/Nav through American Honda Finance Corp. right now for 3 years with 12,000 miles per, its base lease money factor and residual value should be .00220 and 59%, respectively. The numbers for an otherwise identical lease of a 2005 Acura TSX w/Nav should be .00220 and 58%. The numbers for an otherwise identical lease of a 2005 Acura Touring MDX w/Nav should be .00196 and 60%.

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CarMan@Edmunds · March 2005

Arnoldm, Lexus Financial Services' residual values for leases with 15,000 miles per year are 2% lower than its residual values for leases with 12,000 miles per year. Its current special lease program is scheduled to run through March 31st. It is difficult to say what its lease program will be like after that date at this time.

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CarMan@Edmunds · March 2005

Unless they are running a special promotion, all banks that lease vehicles to consumers require that a security deposit equivelent to your vehicle's monthly payment rounded up to the nearest $25 or $50 increment be paid at lease signing. Most banks will waive their security deposit requirements in exchange for a slight increase, .00010 or .00015, in the money factor that is used to calculate vehicle's payments. I always quote lease programs to consumers assuming that they are paying a security deposit. I prefer to pay one rather than paying a higher lease payment, because you get a security deposit back at lease end.

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andyhiggs · March 2005

Thanks a lot for the information Car_man. Knowing that Honda is providing $500 cash on the coupes will help. Going to try hard to get down around $270/month. Hopefully that helps me. Thanks.

soulslinger · March 2005

Car man:

I am somewhat new to the leasing game. I live in Michigan and I was wondering if I was quoted a good deal on a 2005 Ford Freestyle Limited AWD. Lease. MSRP: 32730. With Z Plan: 29503.75. Zero down. Just tax, title and Ins. (24 months) 379mo. The dealer also quoted me a lease price for a SEL AWD (SEL has front row comfort package). MSRP: 30195. Z Plan: 27300.25. (24 months) 377.37. Leather and aux. climate control on both models.

I have read your articles on leasing but I wanted to get your opinion on both quotes. The dealer stated that due to the residual on the limited (62 %) the price is within a couple of dollars compared to the SEL. The delaer was also really pushing the 24 months instead of the 36 that you recommend. I hope I have given you enough info. Thank you for your attention to this matter.

allcaranswers · March 2005

i believe this deal, in fact i've seen better. however it is a very good one. some distributors will pump up the residual to somthing crazy like 70-71% just to move some units. take it, it's surely for a limited time only!

paulsaz · March 2005

I would like to lease a S40 2.4i auto, with select. The price should be around $25,000. I would qualify for the $1250 loyalty bonus cash. I am interested in both 36 and 48 month leases with 12,000 miles per year. Looking for mf and residual.

jdkx2 · March 2005

I would like to lease a Nissan King LE. I qualify for VPP pricing. The specific truck I am looking at has a MSRP of $30,710. The dealer is telling me the VPP price is $27,689 with a MF of .00175 and a residual of 53%. Are these realistic prices or could I get a better price, will the current $1500 rebate lower that VPP price and what would the monthly lease rate be? Thanks for any help.

suv_shoppin · March 2005

I currently own free and clear a 2002 Maxima GLE worth about $12,000 Kelly Blue Book. I am interested in getting the best deal and lowest monthly payments ( yes, I am payment driven) in an SUV that offers 3rd row seats. I like the Acura MDX the best so far. The options I want are leather, sunroof, 6 CD and Navigation. I need some advice on whether to put the absolute minium down and then have the dealer cut me a check for the balance of my trade or should I go another route. Any ideas or suggestions are appreciated. I am not stuck on the Acura MDX and am really looking for a DEAL and lowest payments. Thanks.

testykaren · March 2005

The purchase price would be around $48,500. But the problem seems to be the very high money factor on this vehicle. Is this number typical for volvo? I would expect that it would come down soon since the car is new. Let me know what the numbers would work out to. Thanks.

CarMan@Edmunds · March 2005

You're welcome, mikey5. The selling price that you get this car for looks reasonable to me. Let's work up a sample lease payment on it for you and see what we come up with. According to my calculations, if you were to lease a 2005 Infiniti G35 Coupe with an MSRP of $35,000 and a selling price of $33,300 through Infiniti Financial Services in March for 42 months with 15,000 miles per year, its zero down, pre-tax monthly payment should be around $433.

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CarMan@Edmunds · March 2005

Hello markrogo. It is very difficult to predict what manufacturers' future lease programs will be like very accurately. I have no idea where Lexus Financial Services will set its residual values for the 2006 400H. I can tell you though that Lexus will almost certainly not provide any sort of lease support on this model when it is introduced. If that is indeed the case and you were to lease one through Lexus Financial Services, you would have to use its standard lease money factor. The last time that I saw it, LFS' base standard money factor for Tier 1 customers was .00205.

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stymiee · March 2005

Are the money factors and residuals fixed, meaning the only thing that dealers can affect is the selling price? I'm looking to lease a Pilot as well and I've heard the current MF is .00154, but am unsure of the residual. I think it is $19,760 for the EXL (no DVD). Can you confirm this and also for the DVD version? I'm still not sure which one I want. I'm assuming that if the MF and residual are constants, all I need to do is compare the cap. cost across dealers right?
Thanks.

CarMan@Edmunds · March 2005

Hello ajpbf7. Here is the information that you are looking for. If you were to lease a 2005 Honda S2000 through American Honda Finance Corp. right now for 39 months (I have not seen this car's 42 month program) with 12,000 miles per year, its base lease money factor and residual value should be .00225 and 56%, respectively.

If you were to lease a 2005 Acura RSX-S through AHFC right now for 36 months with 12,000 miles per year, its base lease money factor and residual value should be .00051 and 58%.

If you were to lease a 2005 BMW Z4 2.5i through BMW Financial Services right now for 36 months (it is not offering 39 month leases on this model right now) with 10,000 miles per year, its base lease money factor and residual value should be .00200 and 59%, respectively. When negotiating your lease on the Z5, make sure to keep in mind that BMW is providing $2,500 dealer cash on it. This money will help you to negotiate an attractive capitalized cost for your lease.

Lastly, if you were to lease a 2005 Ford Mustang GT through Ford Credit right now for 36 months with 12,000 miles per year, its base lease rate and residual value should be 7.5% and 55%. Notice that Ford Credit publishes lease rates instead of the money factors that most banks publish for vehicles. You can convert its lease rates into approximate money factor equivalents by dividing them by 2400.

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CarMan@Edmunds · March 2005

Hi mond. Most banks, I believe including BMW Financial Services, allow consumers to "lock-in" the lease program that is available when they order a vehicle for a month or two. I am surprised that you were not allowed to do so on your Z4 lease. Even if for some reason you can not lock the current lease program in on your ordered car, there is no guarantee that it will be worse when your car arrives. There is always a chance that BMW's incentives on the Z4 will actually be more aggressive next month. Before you get too upset, wait and see what BMW's April lease program for this car is like. If it is the same as or better than its current program, you haven't lose anything.

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CarMan@Edmunds · March 2005

Hey Cosmos2. Vehicles' lease acquisition fees must be paid at lease signing or added into their capitalized costs. For more information and examples on how lease payments are calculated, check out the following informative article that is available here at Edmunds.com: Calculate Your Own Lease Payment.

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