Lease Questions - Ask Here

shellz · January 2001

Thanks all for your advice. Maybe I'll just get the dealer to "refix" all the problems everytime the car goes in for routine maintenance. As for handing the lease over to someone else, or trying to turn around and sell it on my own. I think that's cruel to give someone a problem car...hehe.
Anyhow, thanks for the help!

sstaylor · January 2001

Hey, Car_Man.

Would you mind verifying something for me. I checked the Edmunds Regional Lease Offers section, and I see that Oldsmobile started offering some decent Silhouette 36 month leases on Jan. 16th. However, I checked both the Olds site and the GMBuyPower site, and I see no mention of this offer.

Also, would you mind commenting on a dealers' ability to opt out of manufacturer-subsidized lease deals? I suspect that some Olds dealers may not want to participate (don't know why, as their product seems to be "lot-bound").

Thanks,
SST

vkj · January 2001

car man,

would you please get new lease rates and residuals for an Audi a6 2.7 for 39 months at 12k and 15k year. Also can you tell me the methodology for calculating the monthly saving by one gets by using additional security deposit(s).

thanks,

vinay

CarMan@Edmunds · January 2001

Hi Ace. Although I have not seen the official American Honda Finance Crop. residual values for the 2001 Honda Insight yet. I do know that in the past the 2000 Honda Insight had very low residuals that make leasing one pretty unattractive.

Car_Man
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CarMan@Edmunds · January 2001

SST, I have found that the estimated monthly lease payments that are listed on the regional leasing section of this site are sometimes way off base. One of the several reasons for this cold be that (I believe) the calculations in that area do not use the actual residual values that are used by manufacturers' captive finance companies. The GM BuyPower site would probably be able to give you a much better idea of how much money it would cost to lease Silhouette at this point. To give you an idea of how much this van would cost to lease right now, last month I saw an advertised lease on a 2001 Silhouette GL for $384/month for 36 months with $0 down. GMAC's lease program is a little different this month, but you should find that your payments will still be in the vicinity of the previous program.

Car_Man
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CarMan@Edmunds · January 2001

Hi vi nay. I believe that the Audi lease rates on a 2001 A6 2.7T are in the area of 6.24% or so. Also, the residual values for this car should be around 55% for 39 months with 15,000 miles per year and 2% higher than that for leases with 12,000 miles per year. This information, when combined with the lease formula that I posted on this board a few days ago, should give you a good idea of approximately how much money this car will cost you to lease.

Car_Man
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ace10 · January 2001

are we talking sub 50% for 24 months or what? i just would like to know a ballpark.

ace

ctorrey · January 2001

Carman,

When I leased my first car (Audi A4) from the dealer, I was not offered a lease from Audi Financial Services. Instead, my lease was from a "free standing" local leasing company and I'm not sure I got the best deal at the time - compared to deals I have subsequently seen through Audi Financial. I have noticed that many manufacturers' finance companies (e.g. BMW Fin Svcs, MAC, Audi Fin Svcs, etc) seem to offer very competitive money factors and residuals based on the model, time of year, and model popularity. Are dealers obliged to offer leases from the manufacturer (or manufacturer's finance company) or can they simply ignore them and go through anyone they like? Is this a common occurance? Is it possible to force a dealer to offer the manufacturer's plan?

Thanks again for your assistance and insight.

woodybuick · January 2001

Example: ABC bank has the same rate as GMAC on a car. ABC Bank has a higher residual. Why would I go through GMAC if the payment will be higher? Maybe GMAC is offering some money to the dealer to lease through them (Advantage: Dealer). Maybe ABC bank has a much higher turn in fee (Disposition or Termination fee), and GMAC winds up being more attractive in a lower total cost to the consumer (Advantage: Consumer). There are quite a few different reasons why a dealer would choose to go through a different company. Ask the dealer to run a lease under the manufacturers program and the closest competitor. Compare all the fees, both in acquisition and termination. 98% of the time, the manufacturer will beat the nearest competitor by $50-75 a month. Only one instance comes to mind. I certain bank out of California, which will remain nameless, considers a 2001 model to be the current model throughout the calender year. This means that when the manufacturer is pushing the 2002 and drops the 2001 program, the CA bank becomes much more attractive because you can take advantage of any rebates. Actually, another thought comes to mind. If the company (GM for instance) offers a HUGE rebate on a car, and offers a special lease also, they can not be combined (i.e. 0.9% for 36 months or $1,000 rebate, your choice). When using an alternative bank(ABC bank we'll call it), you can take the GM rebate, and use ABC's rate and residual. Sometimes this combination makes a lower payment than the advertised one by GM alone. Kind of winded, but I hope you get the idea.

mava · January 2001

Hey Carman!

Looking into leasing a Porsche 911 Carrera 2 Convertible. I doubt that there's any subsidized lease support on this vehicle (has there ever been :-) but wanted to know what Porsche's normal rates are.

The terms I'm interested in are the following:

5000 miles annually
48 month term

Thanks in advance for your assistance!

Mac

mamamia123 · January 2001

Hi,

I just signed a lease offer today for a VW Passat, I will finalize everything on monday. This is the deal I got:

2001 VW Passat GLS
Luxury Package
Leather
Auto
Premium sound

MSRP: 26,475$
Cash Down: 1,500$ (includes 1st payment)
Trade-in: 2,000$ (I got a fair price on the trade)

Total Down: 3,500$
39month lease/ 259$ per month

Does this sound like a "good" deal?

popopaul · January 2001

With the expectation of interest rates continuing
to fall the first half of this year, can we expect a direct correlation to lease deals?

I haven't seen any effect yet from the drop in rates over the last 2 months.

I'm looking to lease a 2001 Acura TL. Is it worth waiting a month or so to see if the lower rates
bring down the "due at signing cost". They're
current So. Cal advertised deal is 36 months at
$299/mo with $4,000 due at signing. I love the low payment but not the big out of pocket

divasnh · January 2001

I'm looking for the residual value on a 2001 Maxima GLE. I'm considering a 24 or 36 month lease and am also wondering what kind of interest rate I should expect to pay.

Thanks for any help you can provide.

CarMan@Edmunds · January 2001

Ace, it's tough for me to say for certain but my guess is that for 24 months with 15,000 miles per year a 2001 Insight would probably have a residual of right around or slightly less than the 50% that you mentioned.

Car_Man
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CarMan@Edmunds · January 2001

Mamamia123, you definitely provided everyone with a lot of good information on this deal. However, one of the most important numbers to look at when evaluating a lease is the vehicle's capitalized cost. The capitalized cost, or cap cost for short, is essentially the price that you are paying for this car minus your down payment. Without knowing this number, it is difficult to say exactly how much money they are charging you for this Passat. You also didn't mention if this was the 4- or 6-cylinder, but from looking at the price I will assume for now that we are talking about the 4.

Well, I just played with a few numbers and even though I personally feel as though it isn't a good idea to put so much money down on a lease, when taking your down payment into account the monthly payments that you were quoted sound very reasonable. Enjoy your new car!

Car_Man
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CarMan@Edmunds · January 2001

Hi ctorrey. It is possible for an individual dealership to run a consumer's lease through a bank other than their manufacturer's captive finance company. In fact, not that long ago this used to be a very common occurance. Independent banks were often able to offer consumers more competitive monthly lease payments than captive finance companies were on vehicles without a lot of support. However, given the recent shake up in the automotive leasing industry there are not nearly as many independent banks out there offering auto leases and the ones that remain are being much more conservative than they were in the past. Generally speaking, captive finance companies are usually the best way to go on the majority of vehicles today. In most instances, dealerships want to be able to offer low interest rates and high residual values on their vehicles. The lower the payments that they are able to offer, the more likely a consumer is to purchase a vehicle from them.

If anything, I would think that a dealership would choose to use an attractive lease program that is being offered by a captive finance company and then mark-up the interest rate or charge full MSRP for the vehicle rather than use a random third party to lease you a car or truck. Still, if you have seen advertisements for special leases on a certain vehicle or know that a captive finance company is providing special lease rates on a vehicle that you are shopping for you can always insist that the dealership you are working with run your lease through the captive bank. I don't see any reason why they wouldn't accommodate you. If they don't, there are plenty of dealerships out there. Just walk and take your business elsewhere.

Car_Man
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CarMan@Edmunds · January 2001

Hi Mac. You are right, I don't remember a time that Porsche has offered special lease money factors on its cars. As I am sure you well know, they are easily able to sell anything that they build. Still, their standard lease money factors aren't that bad. As of January 1st their 48 month lease money factor was .00340, but on January 12th I believe that they reduced it to something like .00325.

Car_Man
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CarMan@Edmunds · January 2001

Popopaul, yes given the fact that the Fed recently lowered rates I do think that it is very likely that interest rates in the automotive industry will begin to come down. There will probably be somewhat of a lag before you see rates to drop though. It's tough to say for certain whether you will be able to get a lower lease interest ratte by waiting a month. Given the fact that AHFC's lease program is not scheduled to expire until 2/28, I highly doubt that you will see any changes to their rates prior to that date. Even if they do lower rates, it may not necessarily allow you to lease this car for less money per month. This is because a vehicle's residual values will naturally fall as the model year progresses. Any drop in rates will likely be offset by these lower residuals.

Car_Man
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CarMan@Edmunds · January 2001

Hi divasnh. For a 2 or 3 year lease on a 2001 Nissan Maxima, I would expect you to have to pay an interest rate of around 5 3/4% or so if you lease one through Nissan's captive finance company right now. If you choose to lease this car with 15,000 miles per year, its residuals should be around 62% for a 2 year lease and 54% for a 3 year lease.

Car_Man
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junloche · January 2001

hey carman, please help, iam planning to lease Mazda MPV ES 2001, no trade in, 36 month with less than 12k miles/yr.How much will i pay/month.

mava · January 2001

Carman:

Thanks for your feedback! I saw on the incentives section that Acura is offering $5,000.00 dealer cash on their exotic -- the NSX.

Could you please tell me if there is any dealer lease support on this car and if not, what their current rates are.

This time, I'm looking at the following terms:

36 month and 48 month
5000 miles/year
Residual for both terms

Thanks again Carman. I'm getting one of these cars weather my wife lets me or not!!!

:-)

Mac

expedition2 · January 2001

I know the 2 ways to get out of a lease early, have someone take over your lease payments or buy the vehicle for what the bank tells you is your buy out. My question is, if you buy it to resell it, you have to pay tax on the vehicle. If you sell it to someone else the following day, other than trading it in, are you out the tax money?
I'm sure you are but is there any way around this? If you wanted to buy you could trade it in and get the tax credit, but what if you wanted to lease? Is it my tough luck? Thanks!!

KCRam · January 2001

Hi expedition2

If you buy it, regardless of your intentions the next day, yes indeed, you pay the sales tax on YOUR purchase. You're dealing with two separate title transfers: the leasing company to you, then you to the new buyer. As long as you own that car, even for just 24 hours, you have to pay the necessary fees and taxes.

kcram
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CarMan@Edmunds · January 2001

Hi junloche. I just played with a few numbers and according to my calculations you should be able to lease a base 2001 Mazda MPV ES with an MSRP of $26,760 and a capitalized cost of $24,989 for 36 months with 12,000 miles per year through Mazda American Credit without any money down for a pre-tax monthly lease payment of about $430 per month or so.

You may want to pay a visit to the Town Hall Vans Conference to see if there are any other community members who have recently leased a similar van. Perhaps they would be willing to share how much their payments are with you. Feel free to use the following link to go to that area of this site: Vans Board.

Car_Man

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CarMan@Edmunds · January 2001

Hi again Mac. In the past Acura has offered special lease money factors on the NSX, but unfortunately I am not aware of any at this time. So if you decide to lease this car through American Honda finance Corp. you likely would have to to so using their standard lease money factors.

Car_Man
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ctorrey · January 2001

Carman,

Three quick questions...
1. What is the current calculation for the soon to be defunct luxury tax on 2001 autos?

2. How is luxury tax typically handled when leasing? Capitalized or paid in full outside of the lease contract?

3. Are lease acquisition (aka bank charges) and destintaion charges typically included in the capitalized cost (e.g., [Negotiated Cap Cost]+[Destination]+[Acquisition]= [Total Capitalized Cost]?

Thanks once again.
Thanks.

ram331 · January 2001

I'm considering a lease of a 2001 LS430
MSRP $57990
Negotiated Price $55429
Drive Off $2510
36 om, 12K
I've read the 36 om residuals for these cars is running 59%
They quoted me a payment of $999 before tax
My credit rating is 738
I currently lease from Lexus Financial. Payment look high? What do you think?

blackjetta18t1 · January 2001

I'm going to be leasing a 2001 VW Jetta GLS with base engine, automatic transmission, luxury package, leather package, and monsoon. Originally, the lease qoute given was $345 a month, for 39 months, 0 down, 12000 miles per year. I brought the price from 345 to 330 and finally down to 315. What does everyone think about this deal? Buy price for the car hasnt been negotiated but is $21,700. Any comments would be appreciated

CarMan@Edmunds · January 2001

Hi again ctorrey. According to what I have read, the soon to be defunct luxury tax should be at 4% for the year 2001, 3% next year, and completely phased out after that.

Different states handle vehicle taxes on leases differently. Some stares allow taxes to be included in your monthly lease payments, while others require that they be paid in advance or just assess vehicle owners a use tax. You really need to check with your local department of motor vehicles to find out what the exact laws are where you live.

A vehicle's destination charge is essentially part of its price ans is always included in a its capitalized cost. On the other hand, consumers typically have the choice as to whether they want to roll their lease acquisition fee into their vehicle's capitalized cost or pay for it in advance.

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wsharpe496 · January 2001

Is this a good or average deal:
2001 MDX
15K miles a year
36 months
$37500 MSRP
$654 a month which includes tax
down payment is only the first lease payment of $654.

Thanks, TAD

blackjetta18t1 · January 2001

What do you think about the deal I got?

egreen37 · January 2001

I've been trying to negotiate a 2-year lease/15,000 mile lease on an automatic G20 luxury with leather/sunroof package and heated seats. Edmunds.com has a $1,500 dealer incentive listed and TMV below invoice. Dealers are telling me that the incentive doesn't apply to leasing. Doesn't seem right to me - anybody know?
What would a good deal be for that car?

Thanks.

CarMan@Edmunds · January 2001

Blackjetta18t1, I would be happy to let you know that I think. I would say that the $315 per month that you eventually got the dealersship down to on this car is a very good deal.

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CarMan@Edmunds · January 2001

Hi egreen37. Infiniti is providing a significant amount of lease money factor support on the 2001 G20. It would be too expensive for them to allow consumers to take advantage of cash incentives and the subvented money factors. As a result, as a general rule Intiniti's dealer cash incentives may not be combined with either Infiniti Financial Services or Chase lease contracts.

Car_Man
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egreen37 · January 2001

Thank you for your response Car_man.

It seems then that if I can find some other leasing finance company, I could take advantage of the $1,500 incentive? If so, how do I go about finding leasing finance from a third party?

Also, what should be a fair monthly lease for 24-month/15,000? I'm getting quotes around $450, which seems way too high for a $22,000 car.

If I scrap the idea of leasing the G20, what are the cars right now that have the highest residual values for 24 months?

Thanks for any help.

wsharpe497 · January 2001

CarMan, please answer my question as to whether or not this is a good or fair deal on the following lease:

Acura MDX
15000 miles a year
$654 for 36 months...includes state tax
MSRP is $37500
I have EXCELLENT credit report.

I will appreciate your answer as I see a lot of folks value your answers/input.

I would too.

Thanks, TAD

CarMan@Edmunds · January 2001

Egreen37, you are right that you could take advantage of Infiniti's dealer cash incentive on the G20 by leasing through a third party. However, by doing so you will not be able to use IFS's low lease money factors (about 4.2%) but would probably have to lease at about 7% or 8%.

Your exact monthly lease payments on a 2001 G20 will depend upon the car's full MSRP and the price that you are able to lease it for. For instance, a 2001 G20 with a MSRP of $22,000 and a Cap Cost of $21,000 leased through IFS for 24 months with 15,000 miles per year would probably have a zero down pre-tax lease payment of around $400 per month. If you were able to negotiate a better price, then the payments would be lower.

BMW, Mercedes-Benz, and Acura models seem to have higher residual values than Infiniti does right now. Perhaps you would be interested in some of their products.

Car_Man
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CarMan@Edmunds · January 2001

Hi Tad. I just ran some numbers for you and according to my calculations if one was to lease a 2001 Acura MDX with a MSRP of $37,500 and a Capitalized Cost of $37,500 (no discount) for 36 months with 15,000 miles per year through American Honda Finance Corp. right now without any money down they would have a pre-tax monthly lease payment of around $550 per month.

Even though it includes tax, I think that the payment you were quoted is a little on the high side. It is important for you to find out the capitalized cost for this truck. The capitalized cost, or cap cost for short, is essentially the price that you are being charged minus any down payment. I have a feeling that this dealership is attempting to lease you this truck at a price that is above its MSRP. This would not be surprising given the fact that many dealerships out there are charging premiums for this vehicle because it is in high demand and low supply. If they aren't charging you over MSRP, then perhaps they are marking-up the lease money factor that they are using to calculate your payments.

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ram331 · January 2001

He Car Man,
I'm considering a 2001 LS430, they quoted me
MSRP $57990
Negotiated Price $55429, and drive off of $2910
12K miles/yr
36 months, 59% residual, I have excellent credit
rating of 783, they quoted lease payment of $999,
what do you think?

hzhao · January 2001

Hi, CarMan:

One question I have about residual value on 2001 X5 3.0. Based on 36/36000 lease, BMW give $31316 (MSRP $47,000) with money fact of .0037. The bank give $29000 with money fact of .0029. Should I lease the car for lower residual for better buy out option at the end or vice verse?

jtongue · January 2001

Help! I'm seriously considering leasing a Z-3. Currently, I see BMW has a $1500 incentive. I've negotiated the price (which included the incentive), but can't get a straight answer on the residual. They tell me the money factor is 3.5 which I'm told works out to about 7% interest. The lease is for 39 months with 15000 miles.

Thanks!!

artmbgolf · January 2001

I had a paid off car to trade in Cady for Cady ETC. One dealer said to use the trade to lower my Cap Cost to $1 over Residual. This saved $1,000 in interest and taxs.

When pricing the car at a 2nd Cady dealer, they priced up the lease entirely, then subtracted my trade, which was $1,000 higher. Actually I would have gotten back $1k less, after the deal. They said that a trade/cash was not allowed down on a 1-pay and they would get audited.

Who was right?? By the way, I did the lease with the first dealer and the GMAC lease form clearly says cash/trade/rebates for Cap Cost Reduction. The 2nd dealer would not discuss changing their 1-Pay calculation. Where they wrong or were they hoping to change it after the fact, to increase there profit?

pennfh · January 2001

I am looking to lease a 2001 Jeep Wrangler SE -- w/ options, etc. the total MSRP comes to about 17,500. I would like to lease for 36 mo./12,000 miles. What interest rate would be good and what would my monthly payments look like? Thanks for your help.

CarMan@Edmunds · January 2001

Hi ram331. According to my calculations, using Lexus Financial's standard lease money factor and a 12,000 miles per year residual value of 60% a 2001 Lexus LS430 with a MSRP of $57,990 and a negotiated price of $55,429 would have a $2,000 down pre-tax monthly lease payment of around $862 per month. Of course, tax will boost this payment a decent amount when you factor it in.

I find that it is always a good idea to comparison shop at a couple of different dealerships unless one knows for certain that they are getting an excellent deal. Shopping around is the best way to find out if you are getting a price, or a lease payment, that is appropriate for the vehicle that you are interested in, in your area.

Car_Man
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CarMan@Edmunds · January 2001

Hi hzhao. Although BMW Financial Services currently has a standard lease money factor of .00370, if you lease an X5 through them for 24 through 36 months through them you can do so at a slightly supported money factor of .00340. I don't know what bank quoted you a money factor of .00290, but it definitely was not BMW FS. That is a very aggressive rate and as long as the residual value is reasonable that may be the best deal.

It is difficult to say which of these deals is better without working out sample payments. I suggest that you get monthly payment quotes and go with the lowest one.

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hzhao · January 2001

Thanks, CarMan.

CarMan@Edmunds · January 2001

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

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fwdrive · January 2001

There is an item on the 2001 Nissan GEL called MA for $501. When I asked the dealer he stated it was market assessment or advertising. From the messages on this board I have learned it is Market Adjustment. Is this something everyone is paying or should I negotiate this off what I pay?

fwdrive · January 2001

Hi CarMan,
Do you think with today's fed reduction in interests rates that Nissan will reduce their lease factor? How often do they adjust this rate?
Thanks

CarMan@Edmunds · January 2001

Hi fwdrive. If the dealership that you are shopping at is trying to charge you a marketing adjustment or ADM (additional dealer mark-up) on any Nissan product it is definitely in your best interest to shop around at a few different locations. These fees that dealerships tack on to vehicles prices for additional profit are usually reserved for vehicles that are in high demand and low supply, like the Chrysler PT Cruiser when it was first introduced or the soon to be released Ford Thunderbird. Certain dealerships add this sort of fee to the sticker prices of all of the vehicles on their lot in order to look as though they are providing larger discounts than they really are during negotiations.

Regardless of whatever fees a dealer tries to add on to the price of the car or truck that you are interested in, try to concentrate on the bottom line - the total amount of money that it is going to cost you to drive away in the vehicle that you want. It really doesn't matter if the dealership tacks on all sorts of ridiculous fees if he offers you the lowest out-the-door price. By comparison shopping for out-the-door prices at a couple of different locations you will be able to get a pretty good idea of what the market is like in your area for the vehicle that you are interested in.

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