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Smart Shopper Smart Shopper-Archives Lease Questions - Ask Here 
23872 messages, Last post on Sep 20, 2005 at 8:08 AM
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Car_Man Thanks for the response. Those numbers were from my calculations. I did make an error and not take into account the $4000 reduction on the cap cost when I computed the monthly interest. When I corrected it the numbers matched yours. Thanks for catching it.  I have not yet "gone to battle" with the dealer. I like to make sure all my numbers are correct first. I have done many leases for our small business. The last one on a Ford Pickup took well over an hour at the paper signing before they could get their numbers to match mine. They had included several "hidden" charges that they said were always added on leases as a matter of course. They said they had never seen anyone who actually understood the numbers and could calculate a lease payment. Looks like dealers are still used to steamrolling the consumer. It really isn't that complicated, but somehow only a very small percentage of people know how to figure it. Amazing how a little bit of education can save so much.... Do you have any concerns or red flags on the 51 month lease? Thanks Dan |
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Car_Man, Hopefully this will be the last question regarding the deal I'm currently working. What, if any, effect would the residual value have if at the end of the lease the car was just going to be turn in? Wouldn't an "Closed-End" lease basically be, I drive, they evaluated, car stays at the end of the lease. All the prescribed payments made, no more money owed? Does the person leasing have to pay any monies when turning the vehicle in (providing no excessive damage occurs)? The dealership is saying if a "Good Deal" can be struck with a loaded 2000 GLE, then the residual will not be a factor since we are not planning on selling, buuying or "trading in" the car at the end of the lease. We'll just lease another one. God I hope this makes sense because with all the jargon/mind playing going on, I'm wiped out. Thanks Again!! |
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Hi Gregg, I would be glad to help you out. Through January 3rd, the 24 month lease money factor and 12,000 mi/yr residual value for a 2001 Honda Prelude are .00386 and 65% respectively through American Honda Finance Corp. for both of the models that you mentioned. Through December 6th, Volkswagen Credit's identical lease parameters for the 2001 Jetta GLS V6 are .00335 and 67%. Finally, through November 30th Nissan Motor Acceptance Corp.'s money factor & residual for the 2001 Maxima SE are .00260 and 65%. Car_Man Smart Shoppers / FWI Co-Host |
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No problem, dspangenberg. I am glad to see that your numbers eventually matched mine. I generally advise consumers to lease for terms that are shorter than the 51 month term that you mentioned. I do so for a couple of reasons. One is that your vehicle's warranty will expire over a year before your scheduled lease-end date. As a result, you will have to pay for any necessary repairs to your vehicle out of your own pocket or else face lease end excess wear and tear penalties. Also, 51 months is a long time to be locked into one vehicle. One never knows what can happen during such a long period of time. Your financial situation could change so that you want a more or less expensive vehicle or you could just get sick of your Suburban. With such a long lease it will be extremely expensive for you to get out of this truck prior to your scheduled lease termination date. Car_Man Smart Shoppers / FWI Co-Host |
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Moparfan2, assuming that you are not over your mileage limit and that your vehicle does not have any excess wear and tear then yes at the end of your lease you could just turn in your vehicle and walk away without paying any money. In fact, if your vehicle is in good shape and you paid a security deposit at the beginning you should get that money back in full. This assumes that your lease does not have any "disposition fee." A disposition fee is much like an acquisition or bank fee that a bank would tack onto your lease, but instead of at the beginning of your term it is at the end. Car_Man Smart Shoppers / FWI Co-Host |
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| is there a significant difference between leasing and buying as far as deductions go? I am a small business owner and 75% of the use is for business purposes. | |
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I am currently leasing a 99 Explorer (Open ended Lease) for 5 years. I leased it in Jan of 99 so this is going to be my 3rd year. I don't know why I did such a thing. One, leased it for 5 years. Two, leased such a bad car (having 4 recalls in the first few months). Plus having to deal with the Firestone thing. I want to get out of my lease. How and what can I do to get out of it? |
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I thought those were an almost extinct breed. It's my understanding that you can get out of an open-ended lease anytime. Check your payoff amount, sell the Exploder for that number and pay off the contract. A sale price less that the payoff comes out of your pocket. The 'benefit' of open-ended leases was supposed to be that you could build equity in the lease if it was worth more than the residual at maturity. The amount over the residual went in your pocket. Problem is most vehicles aren't worth more at maturity, they're worth less, so the difference comes out of your pocket. The sad part about 5 year leases is that you end up paying for almost the full amount of the vehicle then have nothing to show for it. That totally negates the advantage of leasing which is driving a specific car for a limited amount of time for as little money as possible. What are your choices? Well, you can stick it out the whole 5 years. I hope to God you're not over miles. Or you can try to buy out your contract, sell it to someone (slim chance) or do a normal finance, in essence converting your lease into a purchase. Maybe someone else has another idea or two. |
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The buyout on my friend's lease is $21,110. The lease dealer will pay her $27,000. She wants me to be able to buy her purchase option at $21,110 from this lease dealer...but the dealer says No because they can only sell it to her.I wanted to be able to purchase for cash from the dealer and pay her the difference. But the lease dealer states that they will sell it to me only if I finance it through them. Does anyone have any knowledge about this situation? |
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| Hi Car_Man: I have been reading many of the posts regarding leasing cars and applaud your willingness to help those of us in the dark. Hopefully, one more round of neophyte questions will not upset you. I am leasing a 2001 Honda Accord Coupe. I have never leased before. I obtained what I believe is a wonderful deal (since another dealership said WOW what a wonderful deal). The basic numbers are 36 month, 15,000 mile, tax included (not sure if GAP is included) for $256.80 per month with $4,500 down (my choice) plus my trade ($800). Having read many of the remarks in this forum, I know that I need to check out the CAP COST, LEASE MONEY FACTOR, RESIDUAL VALUE AND EXCESS MILEAGE CHARGE. However, I have NO idea what those numbers should look like. Can you provide your usual insight on this please. Thank you and happy holidays. | |
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