Subaru Impreza Lease Questions

Replies to this message:
• Car_man (Apr 24, 2007 4:25 am)

Dear hosts and knowledgeable people around,
 
 I am new to this forum, although I'm old to Edmunds.com. I hope you'll find the time to help a newbie.
 
 In May 2006, I leased a 2006 2.5i manual Sport Wagon. The car is great; however, I am seriously considering terminating the lease early and instead starting a new lease for a 2007 WRX Limited sedan (manual).
 
 My current lease details (on the '06 2.5i Sp. Wagon):
 - MSRP: 18,833; high, I guess;
 - net capitalized cost: 17,004 (after rebates, $1,000 down payment, and negociations); good, I guess;
 - residual: 8,637; low, I now realize;
 - depreciation: remaining 8,367;
 - APR: 2.88% (i.e. money factor: 0.0012); good, I think;
 - term: 48 months;
 - mileage: 15,000/ year;
 
 So now I pay: (depreciation 174 + rent charge 31) * (tax 110%) = 225 a month.
 
 The car is almost 1 year old, with 11,500 miles on it; exceptional condition, practically no wear and tear.
 
 After this long introduction, my questions:
 
 (A) If I return this car tomorrow to the dealership (good one, Day Apollo near Pittsburgh, PA), how much of a hit should I expect? In 4 years, 60,000 miles it would have depreciated $8,368... How much has the car depreciated in 1 year, 11,500 miles, in your opinion? I know I paid 174 * 12 = $2,088 towards depreciation, so I'd subtract that from your number and get an idea of how hard I'll be hit.
 
 (B) Will it help (financially) that I want to lease another Subaru, and that I'm all good with their captive company? All I want is a more powerful car
 
 (C) For a 2007 Impreza WRX Limited (manual!), what invoice should I try to obtain; what residual value; what APR (can I get the same low 2.88%)? I'd do 48 months, 15,000 miles/year, same as I have right now.
 
 (D) Any advice on when should I be doing this, i.e. on when good incentives might show? May, June, July? I'm 100% I want the '07 (completely personal preference on the redesign for '08).
 
 (E) Will insurance go higher (by a lot)? I'm 26, not married, no kids, good job, okay driving record (speeding ticket last year, 10mph extra after many negociations).
 
 I am sorry for posting such a long first message. I do hope somebody will find the time to help out.
 
 Thanks a lot,
 --Bogdan, WRX wanna-be-owner

Replies to this message:
• ateixeira (Apr 19, 2007 10:21 am)
  • bdumitru (Apr 19, 2007 11:06 am)
    • ateixeira (Apr 19, 2007 11:31 am) and 2 more...
• Car_man (Apr 25, 2007 2:38 am)
  • cky3396 (May 05, 2007 10:53 am)
    • Car_man (May 21, 2007 3:38 am)

Replying to: bdumitru (Apr 19, 2007 10:09 am)

Replies to this message:
• bdumitru (Apr 19, 2007 11:06 am)
  • ateixeira (Apr 19, 2007 11:31 am)
    • bdumitru (Apr 19, 2007 12:32 pm) and 1 more...

Replying to: ateixeira (Apr 19, 2007 10:21 am)

Hi ateixeira,
 
 Thanks for your reply.
  
 "Being married would also help, but rates shouldn't be too bad."
  
 I know, but... not now, hehe.
 
 Now, I'm more worried about the financial hit I might be taking on returning the '06 2.5i (details in my first message). Any guesstimate?...
 
 Thanks,
 --Bogdan

Replies to this message:
• ateixeira (Apr 19, 2007 11:31 am)
  • bdumitru (Apr 19, 2007 12:32 pm)
    • ateixeira (Apr 19, 2007 1:48 pm)

Replying to: bdumitru (Apr 19, 2007 11:06 am)

Replies to this message:
• bdumitru (Apr 19, 2007 12:32 pm)
  • ateixeira (Apr 19, 2007 1:48 pm)

Replying to: ateixeira (Apr 19, 2007 11:31 am)

"The good news is that they do hold their values well. If you sell it alone I bet you can recover 80% of what you paid, which is not bad."
 
Well, I can't really sell it
It's leased, so all I can try is to find someone to take over the lease, right? Or am I wrong?
 
How "killed" do you think I'll get?... The car depreciates (according to the lease contract) ~$8,300 in 4 years, 15,000 miles/year. Now it has 1 year, 11,000 miles. Granted, it's the first year But I'm hoping that the depreciation would be something like: 1st year = $3,200; 2nd year = $2,600; 3rd year = 1500; 4th year = 1000. Am I way off?
 
What do people here think?
 
Thanks,
--B

Replies to this message:
• ateixeira (Apr 19, 2007 1:48 pm)

Replying to: bdumitru (Apr 19, 2007 12:32 pm)

Sorry, missed that important point.
 
In this case the same dealer may be your best bet. He'll be motivated to make the new deal so he may help you get out of the old one.
 
Still, you will have taken delivery of two brand new cars, and New Car Smell is the most expensive smell in the world.

Replying to: researchworks (Mar 24, 2007 6:30 am)

Replying to: bdumitru (Apr 19, 2007 10:09 am)

Replies to this message:
• cky3396 (May 05, 2007 10:53 am)
  • Car_man (May 21, 2007 3:38 am)

Hi Car_man,
 
First off, thank you for your detailed reply. This forum lives up to Edmunds.com reputation.
 
I've read my current lease contract in detail. It allows me to end the lease early, provided I pay: I - P - R + F, where:
I = Invoice.
P = Payments made so far (the part credited towards depreciation).
R = Realized value of the vehicle (that me and the dealer agree upon).
F = turn-in lease fee.
Now:
I = 17,000 (in contract), F = 300 (in contract).
Then, hopefully:
P = 175 * 13 = 2,275, since I've made 13 payments of 225 = depreciation 174 + rent charge 35 + tax 10%.
R = 13,415, since that's the trade-in value appraised by Edmunds.com, for 12K miles, outstanding condition.
So I'd have to pay 17,000 - 2,275 - 13,415 + 300 = 1,610.
 
Now, since R is negotiable, the end result may vary; I assume/ hope it won't go north of, say, 1,900. I could factor that in the new lease and pay approx. $40 a month. I know, paying money for a car I won't be driving...
 
Can you please tell me if my process of thought is far off? That is, am I dreaming dreams here or is this actually possible? (I did read the contract very carefully).
 
I mean, having a $2,000 negative equity doesn't sound exactly like a dream, but... I want the WRX really bad.
 
Please let me know of your thoughts.
 
Thanks,
--Bogdan

Replies to this message:
• Car_man (May 21, 2007 3:13 am)