Lease Questions - Ask Here

CarMan@Edmunds · April 2002

Good morning, dayers. I would be happy to give you an idea of what this car's lease program should look like right now. You didn't mention how long you are looking to lease this car for or how many miles per year you need, so for now I will assume that you are interested in a 3 years lease with 15,000 miles per. Please correct me if you are looking for a different length or mileage allowance. If you were to lease a 2002 BMW 325i through BMW Financial Services at this time for 3 years with 15,000 miles per, their base lease money factor and residual value should be .00220 and 59%, respectively.

The lease calculators that many manufacturers provide on their Web sites, seem to provide quotes that are a little higher than what one would get in real life for some reason. Just in case you are interested, here is a sample lease that BMW is actually advertising on this car right now. They are promoting a 3 year 10,000 miles per lease on a 2002 BMW 325i (MSRP: $27,745 and Cap. Cost: $25,651) for $329 per month with $2,500 down. At lease signing, you would be responsible for this car's down payment, first month's payment, a security deposit of $350, and an acquisition fee of $525.

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CarMan@Edmunds · April 2002

Hi again, rxke. I am glad to hear that your E-Class lease turned out so well. I would be more than happy to give you an idea of what the lease programs should be like for these models, but unfortunately many of their lease programs either just expired or are scheduled to expire in the next few days. The only model that has a lease program that has not expired is the BMW 325xi Sedan. If you were to lease this car for 3 years with 12,000 miles per prior to the end of April, the BMW Financial services base lease money factor and residual value should be .00220 and 61%, respectively. For information on the April lease programs for any of the other models that you are interested in, please check back with me late this week. Talk to you then.

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CarMan@Edmunds · April 2002

Hi Bret. Interestingly enough, DaimlerChrysler just introduced special lease money factors on their minivans for the month of April a few days ago. I don't have all of the details of their new program just yet, but should be able to tell you exactly what it is like if you check back with me tomorrow. Talk to you then.

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CarMan@Edmunds · April 2002

Ken, I looked into this for you and DaimlerChrysler is definitely running their current early lease termination program through April 30th. Whether or not they continue it past that date is anybody's guess, but I personally have a feeling that they might not.

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km99cobra · April 2002

Car_Man,

Thanks for getting back so quickly. Can you confirm that with the extension until April 30 that they are also extending the qualifying period to the end of September? Previously, to qualify, the lease contract had to terminate by end of August 2002. Mine terminates in September which is why I missed out last month. Thanks.

Ken

CarMan@Edmunds · April 2002

You're welcome, Ken. I am sorry to say that even though DaimlerChrysler's current early lease termination program is scheduled to run through April 30th, it only allows consumers whose contracts are scheduled to expire between 4/1/02 and 8/31/02 to get out of their current leases early without penalty.

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pantherburn · April 2002

Sorry, but although my question has probably already been answered, I don't have time to look through the 3400 posts at this time. Please note however, that any responses will be greatly appreciated !

Scenario: I'm 41 years old and have never financed or leased a vehicle. I've been fortunate and blessed in this aspect. It's now getting about time to replace my wife's 1998 Suburban with another SUV, so naturally I'm looking at this point in time. This research has lead me to question the viability of purchasing options, especially interested in pros and cons of leasing. BTW, I've read the leasing primer in the "smart shopper" section. My wife generally puts about 12-13K miles/yr. on her vehicle. All of my vehicles are extremely well maintained and well cared for, so I've had no problem selling them privately when the time comes. I guess my question is, given my scenario, if you have the cash to buy a new car outright, would there be any advantages to leasing? TIA.

alexi1 · April 2002

Carman, can you please tell me what the 39/36 whichever applies) months 10k/12k MF and residuals are for:
Mercedes ML 320
Lexus RX 300 AWD
BMW X5 3.0

As always, thanks very much.

parnola · April 2002

Not sure if this is the best place to post this question, but a friend of mine is in a jam. Her father recently passed away and still had 13 months left on an Infinity lease. Infinity has been going around in circles about what to do. Finally today they've decided that my friend has two options: either buy out the lease for $22k or pay the remaining 13 payments, but she has to turn the car in now - she can't drive it for the remaining 13 months. Furthermore, she can't get the lease transferred to herself. This doesn't make any sense at all to me. Has anyone been in a similar situation?

im_brentwood · April 2002

I have seen this happen before with Jaguar Credit and Lexus financial.

Generally they let you just return the car. I hate to sound rude, and I hope it doesnt come out as insensitive..but..

What are they going to do? Sue a person once they have died?

She needs to talk to a supervisor I think...

Bill

parnola · April 2002

Thanks for the insight - she spoke with a supervisor today who wasn't much help. I know what you are saying, but I suppose they can sue the estate. I'm really not sure!

skindoc · April 2002

Car Man:

Can you please let me know the current MF and residuals for:

BMW 530i, 3 year, 10K/year and 12K/year;
Mercedes E320 3 year, 10K/year and 12K/year.

Thank you,

rroyce10 · April 2002

..... Sorry to hear about the loss, it's never easy.

The contract calls for 2 people .. right ..?

If one doesn't qualify without the other, then the vehicle will go back early. The reason why you aren't getting a "straight" answer is .. this doesn't come up very often. And when it does, most people just carry the vehicle, if they choose to. If the lease is -just- in dads name, they will take it back ..and no, they can't sue the estate. -- most times the lease co. isn't even notified.

Best wishes ..

Terry.

CarMan@Edmunds · April 2002

Hi pantherburn. Theoretically, if one were to finance a vehicle and sell it after a period of say three years or if one were to lease that same vehicle for an identical period of time they should come out about the same. So in that respect, leasing really is not any more expensive than financing a vehicle and selling it after a short period of time. Either way the vehicle that you are driving is going to depreciate and you are going to have to pay interest on it. In fact, in some instances if the lease money factors are really low or the residual values are really high, one could actually come out ahead by leasing a vehicle instead of financing it. There is no definitive answer to the question of which one is better, purchasing or leasing. It will all depend upon the deals that are available on the vehicle that you are interested in and your driving habits. Many people enjoy leasing vehicles mainly because it allows them to drive a new car or truck every three years or so without the hassle of selling their vehicles on their own or the expense of trading them in to a dealership. There is a great discussion here on the Finance, Warranty, and Insurance Message Board on this subject that you should check out: postoak "Buying (leasing) is better than leasing (buying) --- here's why" Jan 2, 2002 12:00pm. Also, here are two articles from this site on this particular subject: Leasing vs. Buying: The Differences and Leasing vs. Buying: The Similarities.

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pantherburn · April 2002

Car_Man, Thank you very much for taking the time to reply. I will definitely check the links that you provided - much appreciated. I guess in my case, where I would be "self-financing" the purchase, (i.e. no outside lenders on a purchase) it may be necessary to consider the "cost" of money for the time period before turning the vehicle over. Of course depreciation of the vehicle is a major consideration also. Perhaps the better scenario would be to perhaps just pay cash for a one year old, low mileage, used vehicle. As we all know too well, vehicles are a very poor investment - depreciation. Thanks again for your help. It looks like I've got some more research to do...

nosinnot · April 2002

I have about a month to replace my leased Expedition and am looking for a few pointers. Would be appreciated if the host could share the key and current lease drivers (factors and residuals) for the Sequoia and Navigator at 3 and 4yr terms. Also advice from anyone on the best large-SUV lease deals around, in case I am missing one.

Many thanks.

pantherburn · April 2002

This may be a stupid question, but hey I'm pretty anonymous here, so... What would be a good strategy for negotiation if you are going to lease? Do you negotiate the MSRP down like you are going to purchase for cash, and then negotiate the lease terms? Are the "subsidized" leases the better/only good deals? Any other "gotchas" ? TIA.

haplology · April 2002

Any new incentives on the Escalade? What are the April MF and residual on a 3 YR, 12K lease? And how about a 39 month lease?

Thanks.

lonestar98 · April 2002

Read your post that new programs are coming, so I thought I'd throw in my question as well. Looking at a WRX sedan here in California. The dealer is offering $350 over invoice and spec'd to my choosing. The term is for 36 months, 15K year, and $3K total driveoff.

The lease offer is from Chase. The MF is .00225. They have a residual of 53%. There is a bank acq. fee of $595. There is a security deposit of $325. I believe the disposition fee is around $325 as well.

Is this a fair deal or should I look elsewhere?

CarMan@Edmunds · April 2002

Hi alexi1. It is the beginning of a new month (and a new quarter for that matter) and as a result, the incentives and lease programs for the majority of manufacturers that sell vehicles in the U.S. have either just expired or are scheduled to expire in the next day or two. This is the case with both Mercedes-Benz and Lexus. Please feel free to check back with me late this week for information on their lease programs. BMW, however, is one of the few companies whose lease program was scheduled to run through the end of April. I can give you an idea of what it would be like to lease a 2002 X5 3.0 right now. If you were to lease this truck through BMW Financial Services this month for 3 years with 12,000 miles per, their base lease money factor and residual value should be .00220 and 63%, respectively. Their 10,000 miles per year residual value for this model would increase to 64%.

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CarMan@Edmunds · April 2002

I am sorry to hear about your friend's sad situation. The last thing that anyone wants in such a difficult time is to be harassed by a bank. Many lending institutions have policies that they will end the leases early and take back the vehicles free of charge for the families of any of their lessees who pass away in the middle of a contract. Who did your friend speak with in their discussions with Infiniti? Perhaps they would get better results by moving this discussion up the managerial ladder another notch or two. I completely agree with Bill in this case. It seems unlikely to me that Infiniti Financial Services would sue someone's estate, but I suppose anything is possible. There certainly would be some negative publicity associated with such a lawsuit if your friend wished to escalate the situation by notifying the press to counter any lawsuit.

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CarMan@Edmunds · April 2002

Hello skindoc. As I just mentioned, the lease programs for most manufacturers recently expired and I have not seen all of the new information, yet. This is the case with Mercedes-Benz. Please feel free to check back with late this week for an idea of what their April lease program will look like. I can, however, give you an idea of what a lease of a 2002 BMW 530i should look like right now. If you were to lease this car through BMW Financial Services for 3 years with 12,000 miles per this month, their base lease money factor and residual value should be .00210 and 61%, respectively. The 10,000 miles per year residual value would increase to 62%.

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CarMan@Edmunds · April 2002

Hi nosinnot. Toyota's lease program expired at the end of March and Lincoln's lease program is scheduled to expire on April 8th. I have not seen their April lease data yet, but expect to a few days after their new programs are released. Please feel free to check back with me in a few days for an idea of what the Sequoia lease program is like for this month and a few days after Lincoln introduces their April program to get an idea of what their new one is like. Talk to you soon.

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CarMan@Edmunds · April 2002

Pantherburn, there are two main numbers that you as a consumer should be concerned with when leasing a new vehicle. These numbers are the car or truck's capitalized cost and its lease money factor. The vehicle's capitalized cost is essentially the price that you would be paying for it had you paid cash for it minus any down payment that you make. Consumers are free to negotiate the prices of leased vehicles just as if they were financing or paying cash for it. The other important number to look at is your vehicle's lease money factor. Banks that lease vehicles publish a list of lease money factors that dealers may use to lease certain vehicles. In turn, dealerships are often permitted to mark-up these money factors to bake additional profit into deals. In order to find out if the dealership that you are working with is marking up the lease money factor for the car or truck that you are interested in leasing, please feel free to check with me to find out what this model's base lease money factor should be like. I usually can give consumers a pretty good idea of what sort of money factor they can expect to receive if they were to lease a particular model through its manufacturers' captive finance company. It certainly is in your best interest to lease a vehicle that has lease support available on it, but there are cases where manufacturers' or other banks standard lease programs are not that bad. The specifics of each deal will vary from model to model, and even from month to month.

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CarMan@Edmunds · April 2002

Hi haplology. General Motors' new lease program just came out yesterday and I have not had an opportunity to take a close look at it yet. Please feel free to check back with me late this week or early next and I should be able to give you an idea of what the lease program should be like on the Cadillac Escalade for the month of April. Talk to you then.

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davecope · April 2002

As I spoke with a sales person, he mentioned that when the model year changes, the residual values jump resulting in lower lease costs. I couldn't get an articulate explanation from him as to why this would be so. Can you explain? And if this is so, is there a resource I can use to predict the model year change so I don't get into my lease just prior to new model release. Thanks!

pantherburn · April 2002

Car Man,

I need your address so I can send you a Christmas present! Thanks for all the help that you have given me. I've learned a lot. Now, once I have a firm grasp on the information, I'll be prepared to negotiate a lease if that's the way I decide to go. Thanks !

soylent · April 2002

Greetings Car_Man,

Great forum, long time reader, first time poster(word?). I am looking at leasing a 2002 Saturn Vue for my wife, and I know you are the "Shell Answer Man" of financials. Here are the specifics:
- 2002 Saturn VUE
- $26,448 no haggle sticker price
- 3/36 - 12,000/year lease
- OOP $0( maybe $1,000 )
- Los Angeles, CA.

I am curious of the residual value of the VUE. I recall several years ago looking at a loaded Saturn Wagon; the sticker price was reasonable, so if I was going to purchase it, the pricing/interest rate was fair. But once I got around to talking lease, the residual value of the car was so bad the lease payment was nuts. So I am wondering 1. Residual value of the VUE 2. money factor 3. what would be my monthly payment?

Your help is appreciated!

lonestar98 · April 2002

is it worth it to pay $10 to leasewizard to get 6 live lender quotes?

CarMan@Edmunds · April 2002

Davecope, vehicles residual values gradually decline as the model year progresses. Manufacturers often increase the lease money factor support as this happens to prevent their vehicles' monthly lease payments from increasing dramatically. However, unsupported vehicles will indeed be less expensive to lease when they are first introduced than equivalent models that are at the end of their run. There is no way to predict what a vehicle's residual values will be exactly prior to when this information is published by banks. However, it is definitely safe to say that you are probably better off lease-wise to lease an unsupported vehicle at the beginning of the model year than the previous year's model. The only way that the older model would be less expensive to lease is if the dealership that you are working with was willing to give you enough of a discount on it.

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CarMan@Edmunds · April 2002

You're welcome, pantherburn. I am glad that I was able to help you out. If you think of any other questions, please don't hesitate to ask.

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CarMan@Edmunds · April 2002

Thanks for being such a loyal reader, soylent. Last month, Saturn was not providing any sort of lease support on the VUE. I suspect that this is the case this month as well. It really is not surprising, given the fact that this is a relatively well received new model. I have not seen the details of Saturn's April lease program yet. I suspect that I will have an idea of what the residual values for this truck are like early next week. Please feel free to check back with me then to find out what they are this month. Once I have this information, I can calculate a sample lease payment for you as well. Talk to you then.

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alexi1 · April 2002

Carman, thanks very much for the info. When you get a chance, can you please tell me what 39/36 and 10k/12k MF and residuals are for:
Mercedes ML 320
Lexus RX 300 AWD
thanks very much.

rxke · April 2002

Hi Car Man

I am adding another car to the mix that you are working on already(Audi A4 1.8 quattro sedan, Subaru WRX sedan with automatic, BMW 325XI sedan). Could you give me the money factor and residual value for a new Audi TT quattro coupe with automatic? I anticipate getting one of these cars either in April or May. I know you can only give me April numbers.

While going through my car notes I happened to look at the numbers I used for making my really good deal on the Mercedes E320 4matic you gave me(Dec 01) and aside from getting the car at dealer cost, the money factor number I got from them was even lower than the numbers you had(.00339 vs .00256). However, their residual numbers they gave me were also lower(65% vs 61%) so it balanced out. I still got the car for what I wanted to pay. Your help was really great because it gave me the numbers I needed to make a very satisfactory deal. Thanks again.

rxke · April 2002

Sorry Car Man but I did not give you the terms of the lease I would like to have on the TT coupe. 12,000 miles for 36 or 39 months.

rlowrie · April 2002

I am about to lease a new BMW 5401 in Maryland and am trying to get clear on the tax situation in Md. Is the tax due up front? Is it on the total cost or on the "used" part of the car over the lease term? Does it apply to the fees and luxury tax as well? Any insights would be helpful. Also, I believe I read a 59% Resid/.0021 MF deal is ~ what BMWFS is using for 15k/36 month leases- is that right? Can this be reduced with additional security deposits? Sorry for the laundry list of questions but I am about to take the plunge and want to know as much as possible before hand. Thanks.

bosbo · April 2002

What have any of you experienced regarding residual value of Toyota Sequoia when leasing? My first quote from a dealer was less than 50%. This sounds very low to me.

lonestar98 · April 2002

Well, I'm almost totally set. I haven't found anyone willing to beat the .00225 MF. My only sticking point is the acquisition fee of $595 that seems so steep!? I called a third party leasing agent and he said that he could match the MF and lower the acq. fee to $200. I'm a bit leary about going through a third party.

What are my chances for neg. w/ the dealership. could they lower the cost for me?

Any help by Car Man, or anyone else who has an opinion, would be greatly appreciated as I hope to buy this weekend.

cynic · April 2002

Hi Car_man,

Could you please provide the residual values and the lease rates for 2002 Maxima GLE and 2002 CL?
Also, am I correct to assume that 2002 Accord values haven't changed since the last month? All leases I am interested in are for 3 years /45k miles.

Thank you very much for your help!

dtwleungnyc · April 2002

Hello Car_man,

Can you provide the residual values for the Mercedes ML320? I am interested in the numbers for a 3 years/36k miles and 3 years/45k miles terms. Thanks in advance.

njruss1 · April 2002

Could you please provide the residuals and mf for the 2002 I35 for 42 mo/12k and 15k? Thanks!

postnobills · April 2002

Car_Man
Could you please provide money factor and residual for a 2002 Audi 2.7T leased in VA at 15,000 mi/yr for 39 months?
Also, a note of thanks--this is one of the best resources for consumers I have come across in many months!

nosinnot · April 2002

Just closed what seems to be a great deal on a Navigator. Thought someone might find it useful to their own negotiations.

A $46,560 MSRP Navigator was priced at $40,697, plus $400 of dealer fees. 36month lease with a 49% residual was financed by Ford at 2%. That left me with a $560 (before tax) monthly payment. Ford FS pays the first month so there was no drive-off $ at all.

Hope it helps someone.

footie · April 2002

Hi Nosinnot,

It is 2WD right?

Wow. Not only did you got a deal below invoice per Edmunds ( not including the $400 'fees' and 2% of MSRP holdback )my take is that you got a great deal on the financing.

The lease numbers you presented work out in my spreadsheet. The money factor figures out to be .0008333, a good bit lower than other manufacturers MF's at .0025 (which is about 6% )for similar class vehicles.

The discounted interested rate is effectively the same as reducing the cap cost on the Navigator by another $3900 by my math.

Regards

CarMan@Edmunds · April 2002

Hi rxke. I am glad to hear that everything worked out so well with your Mercedes-Benz deal. I have seen Audi's April lease program and would be more than happy to give you an idea of what the lease money factors and residual values should be like for the TT this month. However, for the past two months, Audi has gone away from having one national lease program and is dividing the country into six different areas, each with different money factors. In order for me to provide you with accurate lease information, I need to know what state you live in. Once I have this last piece of information, along with the length of lease you are interested in and how many miles per year you want I will post the information that you are looking for.

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CarMan@Edmunds · April 2002

Hello rlowrie. The money factor and residual value that you posted for the 2002 BMW 540i are still good. BMW Financial Services does allow its lessees to reduce their base lease money factors by putting down multiple security deposits. Specifically, I believe that BMW FS actually allows its lessees to put up to 9 additional security deposits on each lease, but I don't know the exact deduction that each one provides. As far as the tax on leases in Maryland goes, I am sorry to say that I do not know the exact policy in this state. I may be able to direct you to a Web site or two that does have information on this subject though. Try looking on these sites: Maryland Motor Vehicle Administration and Comptroller of Maryland Home Page.

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CarMan@Edmunds · April 2002

Hi again lonestar98. All banks charge an acquisition fee on leased vehicles. Although the exact acquisition fee will vary from bank to bank, most lending institutions charge slightly less than $500. I don't know exactly what Chase's base acquisition fee is off of the top of my head, but $595 does not sound that out of line to me. I do know that Chase raised their acquisition fee a couple of years ago, in exchange for which they were supposedly going to be more lenient on consumers when evaluating lease-end excess wear and tear. Individual dealerships do not have any authority to waive or lower banks' base acquisition fees. Although from time to time, dealerships do attempt to mark this fee up in which case you could get them to lower it to its base level by haggling with them.

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CarMan@Edmunds · April 2002

Hello cynic. You are correct, Honda's lease program for the Accord was scheduled to run through the end of April so those numbers should not have changed. As far as the Maxima goes, if you were to lease a 2002 Nissan Maxima GLE through Nissan Motor Acceptance Corp. this month for 3 years with 15,000 miles per, you should be able to use their base lease money factor and residual value of .00244 and 54%, respectively. I have not seen Acura's April lease program yet, but I suspect that I will have had an opportunity to take a look at it at some point over then next couple of days. Please feel free to check back with me in a couple of days and I will be able to provide you with the exact numbers for the 2002 Acura CL. Talk to you then.

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CarMan@Edmunds · April 2002

Hi guys. I have not seen the Mercedes-Benz or Infiniti lease programs for the month of April yet, but suspect that I will have had an opportunity to take a look at them at some point over the next couple of days. Please feel free to check back with me mid-week and I should be able to provide you with detailed answers to your questions. Thanks.

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CarMan@Edmunds · April 2002

I am glad that you find this section of Edmunds.com so helpful, postnobills. Thanks for posting what state you are in. This piece of information is important because Audi is currently providing six different regional lease programs on its models. If you were to lease a 2002 Audi A6 2.7T this month in VA for 39 months with 15,000 miles per year, the Audi Financial Services base lease money factor and residual value should be .00050 and 50%, respectively. You are actually lucky that you are trying to lease this car in VA, because this is the lowest lease money factor that Audi is offering on this particular model in all of the country.

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