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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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I always thought the residual value was based on a % of MSRP...now that I am getting close to closing a deal on a Honda Odyssey I see that they are calculating the residual based on our negociated purchase price...is this typical...have I been wrong all along? Is this a trick up the dealers sleeve? Is this something specific to Honda leases? TIA Chris
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Replying to: dwynne (May 05, 2005 9:10 am) |
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Replying to: steevo (May 05, 2005 8:35 am)  $379 sounds like a round number that a dealer came up with. I prefer to negotiate a really low price on the new car, negotiate a fair deal on the trade, then get the buy rate on the lease. This will almost never come with a $379 or $399 a month price - more like $341.17 or something. Generally if you just go by payments you are paying too much. If they bring back the 24 month lease deal that can be a good deal, but that is normally not as sweet a deal as 36 months since so much of the depreciation happens that first year. Now when they have those special really high residuals then 24 months lease make "sense". Does NY make you pay tax on the whole purchase price? I think they do, so then you should only pay on the different between the purchase price and trade in allowed. $30k new car $10k trade = tax on only $20k. If they do not, then there may not be much tax benfit from the trade - so you might come out better selling the car yourself. Dennis |
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Replying to: captchaos145 (May 05, 2005 8:46 am) A lot of dealers are now leaving this out of their quotes, since this makes their deal sound better VS someone else. When comparing prices you have to get a quote that includes the car, destination, and any dealer or doc fees. If you don't, you can't really compare deals - or like you can't the number to work out since your price on the car does not include these fees. You negotiated $32,000 for the car (only) is seems, then they add the lease acquisition fee, the destination fee, and any dealer fees on top of this number. So your money does not go as far towards the cap cost reductions. BTW, most folks recommend against paying any money down on a lease. Dennis |
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Replying to: ch7656 (May 05, 2005 9:32 am) Dennis |
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Hi, I posted a question regarding a lease on a 2005 Lincoln Navigator , post # 19705, and I haven't heard a response. I was wondering if I could get a bit of help. Thanks. LB |
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Replying to: adgridley (Apr 14, 2004 2:14 pm) I don't now the various lease options. Can you help? |
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 Are there still dealers out there who offer 24 month leases programs? Why would a payment be more for a 24 month lease as oppses to 36 months if you are leasing less of the car?
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Replying to: ny2jeter (May 05, 2005 12:17 pm) Lease payments are based on the projected residual (worth of the car at the end of the lease) and your low negotiated selling price. Unless the captive lease bank has a inflated residual the REAL residual drops a ton the first year, less the 2nd year, and still less the 3rd year. With 36 payments you have more to pay for, but the first hit is spread out over more payments. For example, the 24/24k residual on a G35 coupe is 69% or $25,033 (ALG) and the 36/36k residual is 59% or $21,405. This is on a 6m coupe with some options with an MSRP of $36,280. Say you negotiate the price down to $34,500. On the 24 month lease you have to pay for $9,467 worth of car or $394.46/month not counting interest or taxes. On the 36 month lease you have to pay for $13,095 worth of the car, but paying it out over 36 months is $363.75 per month. Given the same MF (0.00215) the difference in the payment is $38.50 a month CHEAPER for the 36/36k lease. What Nissan and other captive lease banks did/do is make a 24 month special with an inflated residual to get the lease payments low and roll the cars off the lot. In two years they will then have to figure out what to do with all the lease returns that are worth thousands less than residual. But the March and April numbers for this year look better, and that is all that counts (now). Dennis
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Replying to: dwynne (May 05, 2005 12:59 pm) I am interested in a 24 months lease on a GC Laredo. I know in 2 years I am going to need something w/ a third row and by then the Jeep Commander should be available. I need to keep my payments down and now w/ your input I don't know if that will be possible. I do not think I could get by w/o the third row for a year. Too many kids  . Any suggestions?
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