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Leasing a car, is it stupid?

Discussion in 'Fine Living, Home, Design & Auto' started by Steeze, Jul 1, 2010.

  1. turboman808

    turboman808 Senior member

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    Come on styleforum, leasing a Honda Accord? Come on.

    HAHA I have a honda accord. It's cheap and reliable and gets the groceries and is good on long trips. I don't always give a shit how I look. Sometimes I just want to enjoy a day of horseback riding, shooting clay pigeons, or hiking. I really don't need to take a porsche or a jag all the time.
     
  2. Piobaire

    Piobaire Senior member

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    The process is the same with leasing as you should still be negotiating the selling price of the car and not concentrating on the monthly payments.

    This x 20. Most people do not realize this and no salesman wants you to. Once you realize there's only four variables in a lease, money factor, residual, MSRP and capitalized cost, and that the only variable you can really change is the cap cost, you'll start getting good lease rates.

    Also, always find out the money factor and the residual %.

    I find a real litmus test to see if you're going to get the run around or if someone is serious about leasing you a car at a good price, is to ask for the MF and residual. Also toss out there, "What's the interest rate on this lease?" They will grin at you and say there is not an interest rate, just a money factor. Tell them you realize a money factor is used in the lease formula but multiplying it by 2400 will give you the interest rate.
     
  3. Douglas

    Douglas Senior member

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    This x 20. Most people do not realize this and no salesman wants you to. Once you realize there's only four variables in a lease, money factor, residual, MSRP and capitalized cost, and that the only variable you can really change is the cap cost, you'll start getting good lease rates.

    Also, always find out the money factor and the residual %.

    I find a real litmus test to see if you're going to get the run around or if someone is serious about leasing you a car at a good price, is to ask for the MF and residual. Also toss out there, "What's the interest rate on this lease?" They will grin at you and say there is not an interest rate, just a money factor. Tell them you realize a money factor is used in the lease formula but multiplying it by 2400 will give you the interest rate.


    F*ckers are slick. I got a pretty good deal on my lease, all the more so b/c I intended to buy the car after the lease, and had zero money factor on the deal, but even when I went to close out the purchase (which I ended up doing 3 years down the line) I found a $500 fee they had slipped in there without me noticing.
     
  4. Piobaire

    Piobaire Senior member

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    F*ckers are slick. I got a pretty good deal on my lease, all the more so b/c I intended to buy the car after the lease, and had zero money factor on the deal, but even when I went to close out the purchase (which I ended up doing 3 years down the line) I found a $500 fee they had slipped in there without me noticing.

    When I turned in my last lease, in December, I got the obligatory call from the financing company trying to get me to buy the vehicle at lease end. The stupid idiot was trying to sell it to me for a few thousand more than the contractually mandated residual stated in the leasing contract. She got huffy when I pointed that out and then went on to mention with the collapse of the economy, even the residual was several thousand over current market and one reason people lease things like luxury SUVs is to guard against risk in the used car market. I'm thinking her thinking wasn't that sophisticated, given her reaction.
     
  5. impolyt_one

    impolyt_one Senior member

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    HAHA I have a honda accord. It's cheap and reliable and gets the groceries and is good on long trips. I don't always give a shit how I look. Sometimes I just want to enjoy a day of horseback riding, shooting clay pigeons, or hiking. I really don't need to take a porsche or a jag all the time.

    dude, I get the impression from the posts that you have at least 16 cars. correct y/n?
     
  6. hboogz

    hboogz Senior member

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    This x 20. Most people do not realize this and no salesman wants you to. Once you realize there's only four variables in a lease, money factor, residual, MSRP and capitalized cost, and that the only variable you can really change is the cap cost, you'll start getting good lease rates. Also, always find out the money factor and the residual %. I find a real litmus test to see if you're going to get the run around or if someone is serious about leasing you a car at a good price, is to ask for the MF and residual. Also toss out there, "What's the interest rate on this lease?" They will grin at you and say there is not an interest rate, just a money factor. Tell them you realize a money factor is used in the lease formula but multiplying it by 2400 will give you the interest rate.
    How much variance (talking percentages) or leeway do you potentially have to negotiate capitalized cost, in your experience ? Would or could it be a possible cost-savings to obtain leases from dealerships who are outside of your home state ? As far as the OP: Lease man. <$200? if it's true, you shouldn't pass that up.
     
  7. Piobaire

    Piobaire Senior member

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    How much variance (talking percentages) or leeway do you potentially have to negotiate capitalized cost, in your experience ?

    Would or could it be a possible cost-savings to obtain leases from dealerships who are outside of your home state ?

    As far as the OP: Lease man. <$200? if it's true, you shouldn't pass that up.


    I think there might be some problems with insurance and registration if you go outside your home state, but I'm not a lawyer.

    I think it really depends on some external variables. I mean, in 05 and 06 you would have to fight to get anything off the MRSP for luxury vehicle leases. Last year, I got well under invoice. The disclaimer is that I ordered the vehicle and picked it up the day after it dropped. I am savvy enough to know about the "floor plan bonus" and tell them I wanted that kicked in. They were already offering invoice for the cap cost. They simply would have told me to go fornicate myself just a few years ago.

    However, if you want some sort of rough yardstick, 8-12% off MSRP? There's really a ton of variables and that is a very rough yardstick.
     
  8. hboogz

    hboogz Senior member

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    I hear you. I figure anything from 5-10% off MSRP is a good measure as to what you can negotiate with. By &quot;floor plan bonus&quot; Do mean settling for what they have inventory as opposed to any pre-order, customization ?
     
  9. Piobaire

    Piobaire Senior member

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    I hear you. I figure anything from 5-10% off MSRP is a good measure as to what you can negotiate with. By "floor plan bonus" Do mean settling for what they have inventory as opposed to any pre-order, customization ?

    Dealers do not own the new cars on their lot, they are financed through what is called a "floor plan." They basically just pay the carrying cost for their inventory and they usually do not pay any carrying cost of they move it within the first 30 days of the car being in inventory. If they can move a vehicle fast, they get a bonus. In the case of MB, I found out it was 1.5k.

    There's also volume bonuses the dealership gets kicked back from HQ but it can get rankerous to get them to fork some of that over.

    Don't forget timing too. Best deal I ever cut was the last day of February (a traditionally slow month) which fell on a Saturday. Last day of the week, last day of the month, of one of the year's slowest months. Yeah they can fudge paperwork, date wise, for business office purchases, but you know sure as hell that day was a motivating factor. The sales manager ended up calling a prior customer, that I don't know from Adam, and got him to make us a "referral" so we each got $750. [​IMG]
     

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