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Prices Paid: Buying & Leasing Experiences Audi Q7 Lease Questions
817 messages, Last post on Nov 26, 2009 at 9:50 PM
You are in the Prices Paid: Buying & Leasing Experiences Forum. Your Hosts are car_man & kyfdx
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Replying to: mikeoc1 (Feb 19, 2007 11:14 am) I am not a fan of tying up money. So you are telling me you want to tie up $3000 to save less than 0.7% in interest cost in your lease rate? From my quick math - the difference is negligible - less than $500 difference than putting the money in a bank CD earning 5% or a wash when looking at the long-term market equity returns of 8%. Having the liquidity and flexibility of the $3000 in my bank account over the three years of the lease is better in my book than tying it up with Audi in a security deposit given the current .00036 money factor regardless of one's bank account size. Additionally, Audi could always try to keep that money if you want to break the lease. You can't price the option value of the liquidity.
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Replying to: hoosbest (Feb 19, 2007 4:20 pm) If I didn't give Audi the $3000, my payment would be $30/month higher. I would have to pay an additional $360/year each year for 3 years. The $3000 that I am keeping in my account would have to earn 12% tax free to compensate for the additional $360/year. It doesn't matter that the money factor is already low. The original lease price is based on that. I am making it even lower. I don't need all of my money now. If I did, I'd be broke. I can take $3000, give up use of it for 36 months, and in return save $30/month on my lease payment. I would do that 100 times out of 100 and, in my opinion, it would be financially irresponsible not to. |
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Replying to: mikeoc1 (Feb 19, 2007 4:58 pm) I've been following your posts with interest as I am getting ready to lease a Q7 (15K/36mths). Could you share your monthly payment, MSRP & selling price & your dealer? I'll likely go for the MSD's also. Thanks in advance. J
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Replying to: mikeoc1 (Feb 19, 2007 4:58 pm) In my lease - the savings would have been only about $900 over three years. I prefer to invest the difference and keep the money liquid. At an 8% return (which equals the long term S&P average), the amounts are a wash.
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Is the low MF deal applicable to the base model too, or just the premium?
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Replying to: japhale (Feb 19, 2007 5:51 pm) I'd be happy to share my deal. After reading everything I've read, I feel it's a decent one. I have ordered a Bright Silver, Black interior, 3.6 Premium, Infotainment, Convenience, Technology, Moonroof, 19" wheels. I thought about the cricket leather, but didn't see that big of a difference. I thought about the Quartz Gray color ($750 option) but my wife liked the bright silver a lot better. I thought about the 20s, but the car is coming at the same time that our first child, so went for a slightly smoother ride. MSRP is 55670. Selling price is 53731 (you could probably do a litte better). Residual was 52%, but increased to 53% with AudiCare. AudiCare doesn't change the payment, make sure you include it. Money factor was 0.00038 (Lowered to 0.00006 with 4 MSDs) 36 months/15,000 miles. Monthly payment of $733 taxes included (NJ). Payment would have been about $763 without the MSDs. I bought from Jack Daniels Audi in Fair Lawn, NJ. $4770 due at lease signing (includes first month, the usual fees and a $3000 fully refundable security deposit) I ordered because I need the car in May. I can't wait!! Please ask if you have any other questions. Lots of luck!
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Replying to: hoosbest (Feb 19, 2007 6:06 pm) I took a look at the numbers and wanted to share. Once again, you have to look at the individual deal with and without MSDs to see if it's worth it. The more expensive the car, the more it's worth it, typically. 1 choice would be to keep the $3000 in the bank. If it earned 5% (forgetting taxes for the moment) you would have $3484 at the end of 3 years. If you took the $3000 and gave it to Audi, in my case you'd save $30/month in lease payment. If you diligently took the $30 and put it in the bank every month for 36 months, at the end you would have $1,162. Then you'd get the $3,000 back from Audi so you'd have $4162. Giving up the use of $3000 for 36 months gives you $678 of added wealth. You shouldn't keep all of your money liquid. Significant opportunity cost to do so. If you have your 3-6 months of living expenses already in savings, taking $3000 out of your investment portfolio to do this makes financial sense. If all you have is $3000, don't do the MSDs, and don't buy a $55,000 car!! Have a great day!
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Replying to: mikeoc1 (Feb 19, 2007 11:26 am) If I gave them my A6 for the trade-in, doesn't it mean that I pay less sales tax on the Q7 lease? So if I get 7,000 off the price of the Q7, I am now saving on the tax. Here are the numbers I ran through LeaseGuide.com, without and with the trade-in. This is for a base Q7 with a NJ sales tax. Please tell me if this is realistic! According to LeaseGuide.com w/o trade-in ---------------------------------------------- MSRP: 39900 Base Cap Cost: 38000 Costs Added: 575 (aquisition fee) Cap Cost Reductions: 0 Adjusted Cap Cost: 38575 Residual Value: 23940 (60% - 10k/yr) Money Factor: 0.0004 Term: 36 Sales Tax: 7% Depreciation: 14635 Finance (Rent) Charge: 900 Total Sales Tax: 1087 Total of All Pmts: 16622 Total Lease Cost: 16622 Monthly Pmt: 431 Tax: 30 Total Monthly Pmt: 461 According to LeaseGuide.com w/ trade-in of $7,000 ----------------------------------------------- MSRP: 39900 Base Cap Cost: 38000 Costs Added: 575 (aquisition fee) Cap Cost Reductions: 7000 Adjusted Cap Cost: 31575 Residual Value: 23940 (60% - 10k/yr) Money Factor: 0.0004 Term: 36 Sales Tax: 7% Depreciation: 7635 Finance (Rent) Charge: 799 Total Sales Tax: 100 Total of All Pmts: 9024 Total Lease Cost: 15534 Monthly Pmt: 234 Tax: 16 Total Monthly Pmt: 250
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Replying to: rocco50 (Feb 20, 2007 2:30 pm) In the 2nd example, you say total sales tax is $100. Then you say that of the 250 monthly payment, 16 of it is tax. After 36 months, that's $576 of tax. This represents a $504 tax savings along with a $100 interest savings. Second, you have the total lease cost in the 2nd example as being $15534. $250*36 = 9000 + 7000 down payment = 16000. This compares to the 16,662 cost of the lease in example 1. This more accurately reflects the tax and interest savings. While saving $600 is nice, the downside of doing this is if the car is totaled or stolen and not recovered, you lose the $7000 trade in. A cap cost reduction does indeed save some interest and I do believe a trade in would save the tax on a lease. I do belive, though, that the general consensus would be to avoid any cap cost reduction on a lease, tax savings or not.
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Replying to: mikeoc1 (Feb 20, 2007 7:20 pm) The big question for me on the Q7 remains - is the money factor is also .00038 for the base model just like it is for the premium? I called Audi Fin Svs but of course they didn't tell me this information... Anybody know? Carman? Before I even started to discuss numbers, the salesperson telling me that the lease deal on the Premium is better. Are they getting some incentive from the manufacturer on the premium models?
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