Lease Questions - Ask Here

CarMan@Edmunds · May 2005

You're very welcome, rhboo1. I'm glad that you find this discussion so informative. You never mentioned the selling price 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 price of the car that you want to lease you don't know how good a price you are getting it for. The second reason is that one needs the selling price 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 selling price is.

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dwynne · May 2005

Did they give a reason? They should. I have not known that lease banks will approve a lease with more money down - like a bank will do on a loan. On a loan, they might approve a loan if you pay more down. I don't know if lease banks will approve you if you pay more down, if they would not now.

Do you have auto loan or lease credit previously? If not, then that is probably why. It did not go through. They like to see cars leased or cars paid off without a problem. They also look to see what kind of payments you have had and how you handled it. If you had previously financed a $12k car, but not was to lease a $40k they may balk at it. If you have no car credit record, then starting at a $40k car may be the problem.

It could be that you need a co-signer or to settle for a cheaper car - all depending on the reason for the rejection. I would think someone at Nissan Acceptance should be able to talk to you about "why" and what your options are.

Dennis

karilyn · May 2005

Dear Car_man:

A week ago I leased a VW Toureg, MSRP is : $ 42,820
Gross capitalzed Cost: $ 41, 118.46

The lease if for 48 months, my monthly payments are $450.00
and the amount due at front was $1,980.00 (However since
I had an old car which they said I can trade-in, for $500, I only paid
$1,480).. I didn't have the car with me, however they said ok and
pretty much forced me to get the deal :sick:

Any ways, I have two questios..

1) Is this a good deal? is it at least an ok deal?

2) I was supposed to turn in my trade-in car this week, however it got towed away, and now it will be more expensive for me to get it our than $500.00.. Can I do something about it.., since the car is no longer available to trade-in I believe we have to re-issue a contract right? Can I ask for them to help me out? PLEASE HELP.. Do they have to work with me since they gave me the deal without me having the car with me on that day? Please advise., who's responsability it is legally..?

3) Once I was signing my lease they SCARE me to death regarding the excess wear & tear cost after my lease.. telling me that a deepth scratch wil be charged!!! so they convinced me to $19 extra per month for this insurance Excess Wear & Tear Protection Program that will cover up to $5,000 for repairs... Since I might have to re-do the contract.. I wanted you to give me your expert advise on Excess Wear & Tear protection programs offered by Dealers.. are they worth it? Please help... and I think it will also be helpful for all the people that want to lease in this forum.. Thank you..:)

Please shed some light into my life!!!...

My dealer has been informed today regarding my trade-in no longer being available, so I will wait for your wise advise until I contact them again.

Thanks a million!!!!

K

miiames · May 2005

I am looking to get a 2005 Tahoe or Suburban, is GMAC providing any lease deals? I want a 36 month, 15K lease. If I do lease do the rebates still apply or would it be only the special lease rates. What are the residuals and money rate for these vehicles.

Thanks

imariquinn · May 2005

I just hit 24K (12K a year on a 24 mo lease). What are my options? have someone takeover my lease aka leasetrader? trade in? park it (yikes summer vacation trips & camps-- coming up!)? just pay up at lease end? I have never been in this position before and have always come in under mileage (have a teenager now driving it too). So, should I not worry about it since I will be just getting another van from Honda or do they tack on the mileage overage to the next car? Lease ends April 06 and is with AHFC @ .15 a mile over 24K. Purchase option is $20600 at lease end.

I have not called the dealer yet, but wanted to approach this with some knowledge. I have purchased 4 Hondas from them already, but still.... i am not ready to get into a new lease with them until they have another subsidized 2 yr lease deal (hopefully!!) on the Odyssey again.

CarMan@Edmunds · May 2005

No problem, vector6. I haven't seen a 51 month lease program for the XC90, but I can work up a sample 48 month lease on the truck that you are considering for you. According to my calculations, if you were to lease a 2005 Volvo XC90 2.5T AWD with an MSRP of $43,995 and a selling price of $39,699 through Volvo Finance right now for 48 months with 12,000 miles per year, your zero down, pre-tax monthly payment should be around $487. So if this is the exact model that you are considering, the lease payment that you were quoted for it it a little on the high side. As far as the other vehicle that you are considering goes, if you were to lease a 2005 Volvo XC70 The XC70 with an MSRP of $41,035 and a selling price of $35,900 through Volvo Finance right now for 48 months, with 12,000 miles per year, its zero down, pre-tax monthly payment should be around $372. Again, this payment is less than the one that you were quoted. You may be able to do better by comparison shopping with a few other Volvo dealers.

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CarMan@Edmunds · May 2005

Greetings pabernathy. You definitely DO NOT want to lease this truck for 60 months. No banks have lease programs that provide consumers with the option to return their leased vehicles after two or three years for free. This is just the salesperson that you are working with trying to make a sale. 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.

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CarMan@Edmunds · May 2005

Hi Scott. Here is the information that you are looking for. If you were to lease a 2005 Acura TSX without navigation through AHFC right now for 36 months with 15,000 miles per year, its base lease money factor and residual value should be .00240 and 57%, respectively assuming that you qualify for its top credit tier. The residual value for an otherwise identical lease with only 12,000 miles per year would be 2% higher.

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CarMan@Edmunds · May 2005

Hi buy_low. The lease money factors that you were quoted to lease the 2005 Saab 9-3 Arc Sedan that you are interested in, .00030 for 24 months and .00049 for 36 months, are right in line with Saab Financial Services Corp.'s published lease program for this model. Money factors are different than interest rates. One can convert banks' published lease money factors into approximate interest rate equivalents by multiplying them by 2400. So a money factor of .00030 is equal to an interest rate of less than one percent (0.72%). This is a good sign because it means that the dealer that you are working with is not trying to mark up SFSC's base lease program to add additional back-end profit to your deal. The selling price that you were quoted for this car looks good to me as well. I cannot calculate exact lease payments on it for you that you can compare to the ones that you were quoted without knowing its full MSRP though.

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CarMan@Edmunds · May 2005

Welcome paulyballs. Since you are new to the world of leasing, you definitely should check out the following informative articles that are available here at Edmunds.com prior to visiting any dealers: 10 Steps to Leasing a New Car and Calculate Your Own Lease Payment.

In your post you mentioned that you plan on making a $4,000 down payment on your lease. I always advise consumers against making any sort of down payment 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 your leased A4 would be exactly the same, regardless of whether you had put $4,000 down, or had made absolutely no down payment at all. You can always keep that money in the bank and use it to supplement your monthly payment to Audi Financial Services or use it to make multiple security deposits on your vehicle. Many banks provide a reduction in the money factor that is used to calculate vehicles payment for each additional deposit lessees make.

Audi Financial Services' current 3 year, 15,000 miles per base lease money factor and residual value for the 2005.5 A4 2.0T Sedan without quattro are .00135 and 55%, respectively. Your exact lease payment on this car will depend upon how low a selling price you negotiate. For the purpose of calculating a sample payment for you, I will assume a $1,000 discount off of this $33,795 car. Using all of the above numbers, your zero down, pre-tax monthly payment comes out to around $465.

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CarMan@Edmunds · May 2005

You're welcome, woody2408. Good luck and make sure to let us know how things turn out.

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CarMan@Edmunds · May 2005

Hi jfootman. The good news is that you have not physically taken delivery of your new vehicle yet. Doing so makes unwinding a lease nearly impossible. What you need to do is go down to the dealer that you are getting your new Odyssey from ASAP and discuss this situation with them. In your post you stated that your van will "arrive at the dealership tomorrow." Did you have them locate a specific model and swap for it with another dealer. If so, there are expenses associated with doing so and it might make it a little more difficult to get out of this deal for free. Furthermore, if they already physically have your Suzuki things might be tricky as well. The bottom line is that you stand a good chance of being able to get out of this deal if you act quickly. Be polite, but firm and escalate your situation to the manager if necessary or owner.

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dwynne · May 2005

No one would take over your lease, so forget about that. What "sells" on the lease trader type sites are super low payments and cars that are "ahead" on miles - with say a year to go and 20k more allowed miles.

Some options:

Call AHFC and get a detailed buy out price on the van. Be sure to get a detailed price, since they may include sales tax. Compare the price (w/o tax) to the Edmunds, KBB, and NADA trade in value for the van. How does that compare? If it compares favorably you could get a dealer to buy your van off lease now and get into something else. If that will not work, then check the private party selling price on those sites. How does that compare? If it looks OK then you can work with a dealer/broker (for a fee) to sell your van off of lease to someone else. If you can't find someone to do this for you, let me know and I might can point you in the right direction.

If you want to keep the van until lease end, then you need to stick $0.15 per mile into your savings account each month. Then at the end of the lease you will have the $3,600 or so you need to pay them to take the van back. Make your teenager kick in for the miles they drive as well.

You can't just "not worry about it" - the deal you made was to return the van in April 06 with 24k or less on it. You bring it back with 48k on the clock and the van will be worth a LOT less money for them to sell - and someone has to make that money up and that someone is you. It is a lot cheaper to negotiate the extra miles up front - sort of like a cell phone plan - than to pay for them later.

Last option is to hope that at lease end and with a ton of miles on the van, it will be worth $20,600 or more to a dealer or private party. If so, then DO NOT turn it in - sell it to a dealer or private party like I outlined above. If you pay them the $20,600 then they don't care how many miles you drove. If you think this is the option you are going to go with, I would recommend getting a HondaCare 7yr/100k/$0 deductible warranty NOW (actually, if would have been cheaper before you hit 24k). There is a forum here for Honda extended warranties with links and info to discount HondaCare dealers. Figure on about $1,100 for an Ody warranty.

This might not be a bad idea anyway, you are going to run the warranty out on miles before time to turn the van in. Since it has to be in perfect running shape at that time and you have no warranty you could be stuck with repair bills. If you sell it private party, having the warranty ($50 transfer fee) will be a HUGE help selling it. If you turn it in or sell it to a dealer, you cancel the plan and get a pro-rated refund.

Dennis

y2za · May 2005

Hello!
Have a general question. I was offered a 36 month lease on a 2005 Maxima SE with 15K/year for 366/month. I was asked for one month upfront along with taxes/title/fees. Not sure what this will come out to but should be around $800-1,000. I was told incentives/rebates are not allowed with leases. The MSRP is $28,340.
How does this sound?
Of course the car i really want is MSRP of $29,800.

When looking at capatilization costs should i go with TMV of $27,561 (this is what is listed on this site for the maxima with the msrp of $29,800?

Any feedback would be appreciated.

addi · May 2005

Hello Dennis,

On page 1016. you indicated if a person has a trade in they get a tax credit for the trade in value.
I live in Indiana and the sales tax is 6%.
Would you let me know how the credit works?
Lets say I was looking at a $35,000 cost and my trade in was worth $20,000.
I understand that the $20.0 lowers my cost to $15.0 but where does the credit figure into the system? Many Thanks.

dwynne · May 2005

I don't know if that applies in your state or not. In a lot of states, on a SALE you pay tax on the full price less your trade in.

So in your example tax would normally be due on the full $35k price of the new car, but with a $20k trade in you only pay sales tax on the $15k difference.

Normally, this does not help on someone with a lease. However in some states, sales tax is due on the full price of the car even on a lease. It could be in these states that having a trade will reduce this tax burden.

A quick Google and it appears that it works like this in IN as well:

http://www.in.gov/dor/reference/bulletins/sales/pdf/sib28.pdf

Dennis

rroyce10 · May 2005

............ For starters, forget the dealer ... this is between you and the leasing company, they own the vehicle and they have the title ....

I think Dwynne is a little confused, you have 11 months left on the lease .. so right now, your pay-off is "about" the balance of your payments (minus any interest) plus the residual, plus the tax ....

Leasing companies don't care about the "here and now", but they will start noticing what the market value is, in about 6/7 weeks before the lease is up .. at that time they will look and see what they are currently doing at the auctions - and that's the time you need to be speaking with a Zone or a Regional leasing manager from Honda, not the dealer and not the pretty voice on the other side of the phone ..... they might negotiate the price because of the time of the year and your location, or not ... whatever you do, don't mention the mileage, cuz' then they got ya ...................

Terry

addi · May 2005

Dennis, great info. Much appreciated.

vector6 · May 2005

Car_Man-

What an awesome service you're providing!

The quotes I received were on a 36 month lease, which could impact the numbers, but perhaps not to such a great extent. I've gone to a couple dealers, but there are more, so I will take my search elsewhere if they won't budge and use the 48 month quote, since that falls within the warranty realm.

Thank you thank you thank you for all the help - I've learned lots just by reading other posts.

dwynne · May 2005

I think Dwynne is a little confused, you have 11 months left on the lease .. so right now, your pay-off is "about" the balance of your payments (minus any interest) plus the residual, plus the tax ....

Yes, but NOT paying that interest means the "now" price is less than just the sum of the payments + residual. Plus if they are in a tax on payment state then that is not due so that comes off. They would not be paying any additional sales tax since they would be selling the car to a dealer or THROUGH a dealer to get rid of it.

So the now price would be the unpaid depreciation + the residual + perhaps some "admin" penalties for early exit on the lease - and no tax.

If this number looks good VS current value of the van, then it would be a good time to get out of it.

I am seldom confused, but it does happen. Not this time, though

Dennis

passat_mx · May 2005

For what is worth, here is a copy of the terms of my lease agreement signed yesterday. Thanks Car_Man and Dennis for keeping this forum so instructive.

MSRP (inc. dest): 21,140.00
Sale Price: 17,800.00
Acq. Fee: 595.00 (rolled in)
Gross Cap Cost: 18,395.00
Cap Cost Red: 33.08 (part of a 750 initial payment, see below)
Adjusted Cap Cost: 18361.92
Residual Value: 10992.80
Depreciation: 7,369.12
Money Factor: 0.00031
Rent Charge: 327.60
Total of Payments: 7,696.72
Number of Payments: 36
Single Payment: 213.80
Sales Tax: 17.64
Total Single Payment: 231.44

Initial payment of 750.00, distributed as follows:

Cap Cost Reduction: 33.08
Sales Tax on Cap Cost Reduction: 2.73
First Payment: 231.44
Refundable Deposit: 250.00
Initial Registration: 179.00
Document Fee: 45.00
California Tire Fee: 8.75
Total: 750.00

The Accord feels great, and I got a J VIN too

paulyballs · May 2005

Thanks CarMan. I went to the dealer today and got some more figures. I was wondering if you could take a look and tell me what you think of this deal and where I could make some improvements. I haven't gone into negotiations yet but let's assume for the sake of argument that the dealer will give me the car for $33,000. This is my first time leasing so I'm trying to figure out if all these figures are accurate and/or how this deal looks.
Here are the specs:

2005.5 Audi 2.0T Quattro
Cold Weather Pkg
Sport Pkg
Premium Pkg
Metallic Paint
Headlight Washers

MSRP: 34570.00
Initial Cap Cost: $33,000

LEV%: 56.00%
Lease-end Value: 19,359.20
Upfront Acq Fee: 575.00
Term: 36 - 15000 miles
Money Fact Sell Rate: .00155
Total Sales Tax: $878.45 (not sure why this figure is so low...I am in NJ)
Base Montly Rental: 460.07
Security: 475.00
Total Annual Fees: 178.50
Total Initial Fees: 692.50
Amount due at start: 2684.52
Total Monthly Payment: $460.07

What do you think?

Thanks in advance.

manabout · May 2005

Hey Car_Man,

This is a great service you provide helping to demystify the leasing experience. Thank you.

I am currently looking to lease a '05 G35 coupe, black/graphite with auto, premium and navigation. I am looking at a 24 month/12K mi lease with inceptions only. I've gotten a few offers from dealers, but based on the last set of MF/RV numbers I've seen on this forum their deals seem padded.

One dealer gave me $538 (incl. taxes) and approx. $1600 out of pocket. The second gave me $519 (incl. taxes) and $2100 out of pocket (includes sec. deposit, I believe.).

I've already been "pre-approved" by IFS (for what that's worth), but they won't tell me what the current MF is. I have Tier A credit. The NJ tax is 6%.

Your help would be appreciated.

imariquinn · May 2005

thanks for the info. i logged onto my ahfc account online and it says that payoff is $27000 until next payment due 6-1-05. I will call them to confirm. Also, my actual mileage is 23190 so I will call my salesperson at the dealer and ask about the extended warranty price before I hit 24000.

I looked up 2004 EX-RES on NADA which is what my dealer uses for trades (from previous experience) and it comes back at 22700 (trade in price) with the mileage. KBB was lower though.

My lease payment is almost $500 (so 11 more payments = $5500 or slightly less), lease end buy out is $20600. So not sure if I have enough to work with here.

Also, no leasing incentives offered by Honda on the Odyssey right now. I prefer the 2 yr leases and hope that they offer a similar deal as they did last summer (i.e. $279/mo 2 yrs, with 0-1000 down). Could consider the Pilot, but 3 yr lease with big $$ down right now.

I can drive my 98 odyssey right now to keep the miles down this summer as much as possible and also be on the look out for some good financing incentives to come out before the lease end.

thanks again for your suggestions.

CarMan@Edmunds · May 2005

Hi infinitygrrl. 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 waiting until you are closer to the scheduled end of your lease to get another new vehicle, especially once you take the whopping $9,000 in negative equity that you have on your Frontier into account. This $9,000 will not just disappear. It will severely hamper your ability to get a good deal on your new Altima. Given the fact that Nissan currently only has $1,500 customer cash on the '05 Altima, even if you were to get one at invoice you still would have to pay several thousand dollars out of your own pocket to get out of your Frontier. This is because most banks will not finance much more than vehicles' full MSRPs. My assessment of your situation is that you are pretty much stuck with your current trucks until you are closer the the scheduled end of your Pathfinder lease and less upside down on your Frontier.

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CarMan@Edmunds · May 2005

I am sorry, but now that you have chosen this particular user id, you are required to get a new Infiniti M35, a6_to_m35

. If you're worried about paying too much money for an Infiniti M35, you aren't going to be much better off with a new Audi A6. Dealers and consumers alike have been complaining that the new A6 is way too expensive to lease since it was introduced. A month or two after it hit showrooms, Audi caved in and sweetened its lease program a little bit, but not enough. If you were to lease a 2005 Audi A6 3.2 Sedan with quattro through Audi Financial Services right now for 39 months with 15,000 miles per year, its base lease money factor and residual value should be .00130 and 45%, respectively. From the looks of your username, you currently own an Audi A6. This is a good thing, because to help current A6 owners get over some of the sticker shock of the new model Audi is providing $1,500 lease cash for current A6 owners on the new A6. This money will help you to negotiate a more attractive capitalized cost than if it didn't exist.

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CarMan@Edmunds · May 2005

Congratulations on your new car, fsmd. You're right, American Honda FInance Cor.'s current base lease money factor for the 2005 Acura TL is .00240 for 36 month leases. This factor assumes that you qualify for AHFC's "Super Preferred" credit tier, pay a security deposit equivalent to your car's first month;s payment rounded up to the nearest $25 increment, and pay AHFC's lease acquisition fee of $595. If you have done all of these things, then the dealer that you got your TL from probably marked-up this car's base money factor to add a little additional back-end profit to your deal. This sort of thing happens all the time and would cause your lease payment to be a little higher than it would have been had the base factor been used.

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CarMan@Edmunds · May 2005

HA, welcome back a64marc. I don't believe that American Honda Finance Corp. provides any loyalty incentives to returning customers who lease a new Honda or Acura, other than possibly waiving the new vehicle's security deposit without any increase in its money factor. If you were to lease a 2005 Acura TL 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 .00240 and 59%, respectively. The numbers for an otherwise identical 4 year lease of this car should be .00220 and 51%.

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dwynne · May 2005

Call them and see if that number includes sale tax or not. Quite often they automatically quote the buy out with tax, since they assume that you are actually going to buy it to keep. But even w/o taxes you may be too far from trade value to do anything. What state are you in? I am betting the $27k includes sales tax, since sum of remaining payments + residual is less than that number. If you have a 6% tax rate, then $25,500 would be closer to the right price.

I checked and $1,100-1,150 is about right for the 7/100k/$0 HondaCare, so don't over pay. With that and putting away $0.15 for the extra miles, you will be covered and may can sell the van private party at lease end and keep your $0.15 mileage money. $20k for a yr old Ody even with high miles might not seem too bad to some folks (who are staggered by the MSRP). Having a 100k warranty will ease them right into it

You can do the Pilot lease with less down. We have run the numbers several times here. The EX is maybe a little over $300 with nothing down if you bargain the price low. Even a EX-L with DVD is < $400 if you lease at invoice.

Dennis

jun2 · May 2005

Hi...please let me know if this is good deal..

BMW 2005 325i - 36/30K lease

MSRP 35,995.00 (premium package, silver,heated etc..)

Vehicle Cost 32,995.00 (3,000 less)

Due on signing 1,000
- includes 479 first mo payment
- cap reduction of $338
- no security deposit
- other fees...

479/mo including taxes ( in NJ )

I have 2 months left on my current lease with balance of 942 (2months).
My previous security deposit of 500 was used. 300 goes towards terminating the last 2months of lease, the 200 goes to my cap reduction.
Now it looks like my cap reduction cost is 138 + 500 ( my previous security deposit)

MF i saw is 2.40
Residual is 57%
Acquisiton is 695

Is this a good deal $479/mo ??

Thanks for your opinion...

Jun

fish2575 · May 2005

Please Help! I am really confused about all of the lease numbers and want all of the info I can get before we close the deal. I am looking at purchasing or leasing a 2005 Acura MDX Premium model. We have negotiated a price of $34,395.50 plus Washington state sales tax 9.1% and licensing (about $37,675.50 total).

We are considering the current AHFC lease offer of $2393 down (includes first month, security, cap cost reduction, and acquisition) and $23,606.10 residual, money factor .00206. They say $399 a month, but I don't know what purchase price they use for that monthly amount, and I know it doesn't include tax. I have tried putting the numbers into the Edmunds lease calculator, but I don't think I have enough information to get an accurate monthly payment. We want to purchase the vehicle at lease end or before, but are trying to get the lowest monthly payment in the meantime.

My husband gets bonuses that will let us pay off the car in 2 to 3 years, but we don't have the monthly income to pay $505 a month for the 5.5% rate at 84 months offered buy our CU. It seems like the lease payment should be considerably less than the purchase loan, but since I don't know exact acq. fees, security deposit, cash down, etc. the monthly amount keeps changing in the lease calculator. And I am trying to compare the total amount of money out of pocket over three years. With the loan we would owe $21,735 at 36 month versus the $23,606 plus tax for the lease buyout, but if we are saving over $100 a month for three years, it should come out pretty even right?

Can you help me figure out what the monthly amount would be with this lease deal and negotiated purchase price and then let me know why everyone keeps saying it will save us money to purchase instead of lease? Also, I know that a lesae is negotiable, but what exactly should we negotiate besides the price, and what is in our best interest? I just don't get it. Thank you!

karilyn · May 2005

Dear Car_man:

A week ago I leased a VW Toureg, MSRP is : $ 42,820
Gross capitalzed Cost: $ 41, 118.46

The lease if for 48 months, my monthly payments are $450.00
and the amount due at front was $1,980.00 (However since
I had an old car which they said I can trade-in, for $500, I only paid
$1,480).. I didn't have the car with me, however they said ok and
pretty much forced me to get the deal

Any ways, I have two questios..

1) Is this a good deal? is it at least an ok deal?

2) I was supposed to turn in my trade-in car this week, however it got towed away, and now it will be more expensive for me to get it our than $500.00.. Can I do something about it.., since the car is no longer available to trade-in I believe we have to re-issue a contract right? Can I ask for them to help me out? PLEASE HELP.. Do they have to work with me since they gave me the deal without me having the car with me on that day? Please advise., who's responsability it is legally..?

3) Once I was signing my lease they SCARE me to death regarding the excess wear & tear cost after my lease.. telling me that a deepth scratch wil be charged!!! so they convinced me to $19 extra per month for this insurance Excess Wear & Tear Protection Program that will cover up to $5,000 for repairs... Since I might have to re-do the contract.. I wanted you to give me your expert advise on Excess Wear & Tear protection programs offered by Dealers.. are they worth it? Please help... and I think it will also be helpful for all the people that want to lease in this forum.. Thank you..

Please shed some light into my life!!!...

My dealer has been informed today regarding my trade-in no longer being available, so I will wait for your wise advise until I contact them again.

Thanks a million!!!!

K

CarMan@Edmunds · May 2005

Any time, mustangmike02. Now we have all of the necessary info to calculate a sample lease payment on this truck for you. According to my calculations, if you were to lease a 2005 Jeep Cherokee 4x4 Laredo with an MSRP of $31,620 and a selling price of $26,557 (invoice minus $3,500 in cash incentives plus $500) through Chrysler Financial right now for 39 months with 12,000 miles per year, its zero down, pre-tax monthly payment should be around $352.

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dwynne · May 2005

The price of the car looks $500 or little more too high to me. There is a $1,500 dealer incentive to move these out, so they are only discounting the car by $1,500 .

The buy rate on the money factor is 0.00225 so the dealer is marking it up 0.00015 or 0.36%.

I am not real sure what is happening with your old lease car - is this another BMW or something else? What is it worth VS the buyout price? It is possible you could sell this to another dealer or private party and make money on the deal rather than "trade" it in.

But without knowing more, too much on the price and a jacked up money factor = not good.

Dennis

CarMan@Edmunds · May 2005

Hello heidi. Consumers are free to make any sort of down payment that they would like when leasing. In fact, it is in your best interest as a consumer not to make a capitalized cost reduction when leasing a new vehicle. I always advise consumers against making any sort of down payment 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 Pilot would be exactly the same, regardless of whether you had put several thousand dollars down, or had made absolutely no down payment at all. The reason why Honda is using such a large down payment on its advertised Pilot lease is most consumers only look at the monthly payment of vehicles. $279 per month sounds better than $300 per month or whatever this truck would be with zip down. Honda's special lease program is available on all 2005 Pilot trim levels. Of course, the more expensive the truck you decide to lease, the higher your monthly lease payment will be on it. As you aid, you should negotiate the selling price of the truck that you want and then discuss how much your lease payment would be on it. I would be very impressed if you could lease a new 2005 Pilot EX-L with the rear entertainment system at invoice. Once you have negotiated an attractive price, make sure that the dealer that you are working with is using American Honda FInance Corp.'s base lease money factor of .00137 to calculate your lease payment. If you tel, me the full MSRP and the price that you believe that you will be able to negotiate on the Pilot that you want, I will be more than happy to calculate a sample lease payment on it for you.

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CarMan@Edmunds · May 2005

You're welcome, wsa10. Audi Financial Services' current base lease money factor and residual value for a 36 month, 15,000 miles per year lease of a 2005.5 Audi S4 Sedan should be .00250 and 54%, respectively. Using these numbers, an MSRP of $52,795 (I'm not sure if the gas guzzler tax can be residualized)and a selling price of $52,530, I come up with a zero down, pre-tax monthly payment of around $870.

Given the fact that it is such a new model, I am not surprised that BMW dealers aren't discounting the new 330i yet. If you were to lease a 2006 BMW 330i with an MSRP and selling price of $44,165 through BMW Financial Services right now for 3 years with 15,000 miles per, its zero down, pre-tax monthly payment should be around $694.

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summer4 · May 2005

I am currently leasing a 2001 Dodge Durango, my lease term ends October 2005. I am already at 50,000 miles, my max mileage was 48,000. The mileage rate is 14cents per mile and I have and end of term fee of $450.00. My payments are approx. $392per month. I called my leasing company a few days ago to see if I had the option to turn this lease in early. I do not, however I was advised that I would be in the same boat if I got rid of the truck now or in October. My Payoff on the lease is $14,801.08 the value of the truck is $11,625. I also do not have a warranty on the vehicle and am worried that some problems are creeping up. Should I turn this in now or wait???? I hope I have given you enough info.

CarMan@Edmunds · May 2005

Hello d_v. You never mentioned the selling price or MSRP of the E350 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 car'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 car that you are interested in for you if you let me know what these numbers are.

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CarMan@Edmunds · May 2005

Hi dotcomgirl18. You were very smart to have put off the lease that you were discussing to do some additional research. It is never a good idea to jump into a major purchase, or lease in this case, without doing your homework. Since you seem to be new to the world of leasing, you definitely should check out the following informative articles that are available here at Edmunds.com prior to visiting any dealers: 10 Steps to Leasing a New Car and Calculate Your Own Lease Payment. Once you have read them, I can give you an idea of what sort of lease payment you can expect on the car that you are interested in if you would like. In order for me to do so, I need you to tell me its full MSRP, an approximate selling price, how long you want to lease it for, and how many miles per year you need to be able to drive it. You should be able to get an idea of what sort of selling price to expect by visiting the following discussion: "Volkswagen Jetta: Prices Paid & Buying Experience".

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CarMan@Edmunds · May 2005

Happy 4th of July to you as well, cark. Congratulations on your new truck and thank YOU for taking the time to stop back and let us all know how everything turned out

.

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CarMan@Edmunds · May 2005

Hello there rydog1818. The selling price that you were quoted for this car appears to be fairly close to dealer invoice, which is good for a BMW 330Ci considering the fact that BMW is not providing any dealer cash incentives on it at this time. BMW Financial Services' base lease money factor on the 2005 330Ci is currently .00080 for 36 month leases. You take advantage of this factor, you are required to pay a security deposit that is equivalent to your car's monthly payment rounded up to the nearest $50 increment and BMW FS' lease acquisition fee of $625 (in most states). BMW will waive both of these fees in exchange for an increase in the money factor that is used to calculate your vehicle's payment. If you are not having either of these fees waived, there is a good chance that the dealer that you are working with is marking up BMW FS' base money factor to add additional back-end profit to your deal.

Another thing that I notice about this deal is the large capitalized cost reduction that you are making. I always advise consumers against making any sort of down payment 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 330Ci would be exactly the same, regardless of whether you had put $3,000 down, or had made absolutely no down payment at all.

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CarMan@Edmunds · May 2005

You're very welcome, 429.

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CarMan@Edmunds · May 2005

No problem, burgermac. In every state that I am aware of, except for New York where it is $900, BMW Financial Services' lease acquisition fee is $625. I am surprised that a BMW representative would tell you that its acquisition fee is $825. They usually say that this matter is between you and the dealer that you are working with. At least, they always state that whenever I have heard about someone asking what a car or truck's money factor is. In any event, it's not $825. It's $625 unless you live in NY. If you are not comfortable with the current dealer that you are working with, you are always free to lease your new BMW from a different dealership. Even if there aren't many BMW dealers in your area, you can always negotiate a deal with a different dealer over the phone or via e-mail even if they are out of state.

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CarMan@Edmunds · May 2005

I am not surprised that the Lexus dealer that you are working with is not willing to discount the 400h that you are interested in, shackman. Most dealers have fairly long lists of customers waiting for this truck. Iff you didn't pay full MSRP for it, someone else gladly would. I can calculate a sample lease on this truck for you, using Lexus' current lease program. According to my calculations, if you were to lease a 2006 Lexus 400h with an MSRP and selling price of $49,787 through Lexus Financial Services prior to June 30th for 36 months with 15,000 miles per year, your zero down, ore-tax monthly payment should be around $720 or so. Given the fact that Lexus is not providing any sort of lease support on this model, there may be an independent bank out there that has a more attractive lease program on it right now. Hybrid models are funny though because a lot of banks are concerned about how well they will hold up in the long run and either won't lease them or don't have great residual values for them. It is difficult for consumers to arrange leases through independent banks on their own. Most dealers have computer systems that enable them to search all of the banks in the country to see which one has the most attractive lease program on a given product at a given time. If there is an independent bank out there that has a better lease program for this truck than LFS', your dealer will probably know about it and steer you in that direction.

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jonnyjazz · May 2005

Hi  have been checking this board and am amazed at the great information. Did a search over the last couple of months for posts on a Honda Accord lease and still have a question or two  my first time leasing.

Just a check to see if I have a good value and am using good numbers. Thanks in advance. First time Im leasing.

Looking to buy a Honda Accord EX-L V6 (no Nav system) - (am comparing prices vs. Nissan Maxima, which will be a separate post).

MSRP = $26,850
Sale price = $23,058 ($500 under Edmunds invoice of $24,158) But AutoBuyTel has an invoice price of $22,136. Which invoice price do I use? Seems like dealers rely on Edmunds!

Question  saw posts about dealer cash and EX stairstep program. Is this a fair price or can I go lower that $23,058??

Money factor = .00113  Ive seen that on other posts and looks fine, right?.

Found a listing saying residual was 52% for 15k and 54% for 12k. Sound good?

Question: Honda Finance charges a $595 upfront acquisition fee  Is there a way to get this waived?

Ill plug above into a calculator to try to get a monthly number but

Sales mgr guessed Id be at about $315 per month for the lease on the EX-6 based on a $249 per month lease cost for the EX 4 cylinder and a price difference of $2,728. He said add roughly about $30 for every additional thousand dollars to the $249 lease sales price of $20,330.

Its so hard to nail dealers down on this. Want to be prepared.

Thanks again for your help.

conanc · May 2005

Car_man and others, I am new to leasing and just got my first dealer quote on Saabs. To be honest, I am not sure what all of this means. Can you tell me what you think? Thank you!

Lease for Saab 9-2x for 24 months 12 k mi.price $25206
monthly payments $355
inceptives $2500,
money factor.00008,residual.58,first inital payment is $1547/9

Saab 9-22x with 15k.mi.$366Mo, residual.57,first payment $1558-

Saab: 9-3 24 month - 12k mi.price $30270,
monthly payments$405,inceptives$3500,money factor.00008,residual.57,first
inital payment$164

9-3with 15k.mi.$419,res..56,first pay..$1661

jonnyjazz · May 2005

Hi - trying to decide between Accord and Maxima. Found good info on Accord (see post above) but not much on Maxima. So a few questions to the helpful folks here...

Looking at a Maxima SL (with drivers preferred package, sunroof, VDC (stability control), xm.

Would like to know the money factor on 36 months 12K and 15K. I think it's .00172 through dealer but want to double check. Also residual value. Thanks much. I have pristine credit and 780 FICO.

Price - have a $600 under Edmunds invoice or $28,000 and $26,895 for a demo with 4k miles.

a6_to_m35 · May 2005

Thanks, Car Man!

I have owned A6's, but currently own an allroad as the family-mobile.

The car that I inquire about is my "mid-life crisis" car (without getting too silly). I love the Infiniti, but wanted to make sure to explore any and all options before making a commitment. It is certainly a hot car with all the gadgets that I can think of.

The Infiniti is still in the running--and I have ruled out another A6 (been there, done that). But now I am exploring the A4 Cabriolet.

I just spent the afternoon at my favorite Audi dealer and am dismayed to find that there are no incentives of any kind on the line of Cabrio's. Lease rates are high and residuals are low--even though it holds it value better than any other Audi.

I am also unhappy that there are no "invoice" deals to be had as Audi want to raise resale values--so they are not "walking" the cars out the door.

I drove a A4 1.8 CVT Cabrio, and hated it as it is too underpowered. I love the S4 Cabrio, but the numbers are silly at about $900 mth.

What is left is a A4 3.0

First month plus bank fee and incepts=$1800 upfront

MSRP 49805
Invoice 45995
Selling Price 47500
36 months
15k miles
Money Factor .00185
Residual 53%
tax 6%
$758.06

Car Man, this is a very expensive lease for a $50k car!
Am I missing something? Can you foresee a better deal?

Your input is greatly appreciated.

shackman · May 2005

Hi Car_Man,
Thank you for your note. I have contacted several financial sources all whom are reluctant to take on a lease for the very reasons that you gave. These are the leases offered by the Lexus dealer for 36 months 15,000 miles:

zero down, $853/mo
$1,500 down, $817/mo
$2379 down, $789/mo

All of these seem much more than you indicated it should be but since there is really no other options I guess I need to take it or leave it.

steevo · May 2005

Search back just a bit. Lots of Maxima info 10 days back. I just scored an SE similar options you are looking for. I think the SE has better lease program. Its MF is .00045 and 52% residual. Also there is 500 Cash from Nissan. Thats for 36/15k.

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