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Prices Paid: Buying & Leasing Experiences Mazda CX-9 Prices Paid and Buying Experience
2169 messages, Last post on Nov 22, 2009 at 4:57 PM
You are in the Prices Paid: Buying & Leasing Experiences Forum. Your Hosts are car_man & kyfdx
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Replying to: madscientist3 (Oct 28, 2007 6:40 am) The other thing is that most people think that when you sign a lease, you're going to owe 100% of the payments, no matter what. This is rarely the case; MOST leases have an early termination clause. It can vary, but typically, you have to pay the difference between what you've already paid for in terms of depreciation versus what the vehicle is really worth plus a penalty which can be anywhere from a couple hundred bucks on up to maybe a grand. Remember, with a lease, you're basically paying off the depreciation between what your car was worth when brand new and whatever they estimated it to be worth at the end of the lease (your residual) plus what amounts to interest (they DO have to make money on the financing, of course). Now, if you've got a 3 year lease and it is now only 2-1/2 years into it, your car is probably worth somewhat more than what your residual is. So they basically look at what your car is worth now (compared to the residual) and how much you've already paid against it and then charge you the difference. So if your residual is $10,000, the car is now worth $12,000, it was $20,000 when new, and you've already paid off $7,000, in most cases, you basically have to pay off the difference between $13,000 ($20,000 new minus $7,000 paid off so far = $13,000) and what it is worth now ($12,000) so you'd have to pay $1,000 plus whatever early termination penalties there are (maybe $500). Then you can return the car and that's that. That's a bit of an oversimplification (because it goes by the current buyout and not exactly "what it is worth") but gives the basic idea. Another option of most leases is an early buyout. Sometimes, there's a penalty, sometimes there isn't. Basically, you can usually buy out your lease at any time and then own the car. You can either keep it or sell it and if it is truly worth more than the buyout amount, you can make a profit. Chances that the dealer is going to do that are slim to none because the buyout is likely going to be more than the car is worth unless they REALLY got the residual wrong (way too low). In other words, the dealer would be buying your leased vehicle for more than it is worth and then trying to sell it. They'd never do that. And as I said, most leases provide a less expensive way of terminating the lease early as compared to simply the total of the remaining payments. So likely, the dealer has found out the current early termination amount from your current lease. And then they're including THAT amount (probably plus some profit for their troubles) into the purchase price of your new vehicle. So effectively, you're paying some for your existing vehicle as part of your new one. You can't just look at the "paying $x per month with $x down" as "the deal" because it isn't; it is the sucker's deal. The DEAL is the ENTIRE transaction... the purchase price, options and fees, the term, credit for any trade-in, and the interest rate. THAT'S the deal; the rest is just math. "$x a month" doesn't say anything about whether you're being had on the price of the car, whether they're stuffing extra charges in it, or whether you're getting had on the interest rate. I'm wondering WHY you'd want to get out of an existing lease early when that basically means you're throwing away money. If you just can't afford that vehicle anymore and are getting into a cheaper one, then that may make sense. Or if you're getting a deal on a new car that you would NOT be able to get later on that justifies the extra cost (I did that once; got a new vehicle with 2 months left on an existing lease because in 2 months, I'd be in a new model year that would cost SIGNIFICANTLY more and would cost far more than the extra two months of lease payments). Other than that, it just makes really poor financial sense. Even if you WANT a new car, unless the Pilot is just completely unusable for you, your best FINANCIALLY would probably be to WAIT until your lease is either up or close to up before buying a new vehicle.
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Replying to: warever (Oct 28, 2007 11:12 am) If you wait until your lease is up you have to pay wear and tear and excess milage charges. If you can find a dealer to take it off your hands as a trade, your much better off. Besides, if you wait until the lease is up, your in a desperate position to buy a car. I'd rather have the leverage of being able to walk out the door and still have a car. These are a few reasons why I'm not leasing my next car.
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Replying to: kyfdx (Jan 21, 2007 8:01 pm)
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Replying to: jintorcio (Oct 28, 2007 1:48 pm) |
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Replying to: seloo (Oct 23, 2007 1:47 pm) 07 CX-9 $0 under invoice. At invoice. 08 CX-9 $500 under invoice. Includes rebates. Keep posting those good deals.
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I'm looking at buying a 2008GT CX-9, and don't know much about Mazda. What is the relationship between Ford and Mazda? What major parts of the CX-9 are Ford parts? Do you think one could get as much wear out of a CX-9, and as little long term problems as you may with Pilot or Highlander? I'm looking at 2008GT CX-9 with moonroof and Bose package. Any feedback on quotes or what you paid is greatly appreciated! Thank you!
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Replying to: nm1675 (Oct 28, 2007 7:19 pm)
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Replying to: madscientist3 (Oct 29, 2007 6:06 am)
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Replying to: vinnyny (Oct 29, 2007 7:11 am)
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Replying to: madscientist3 (Oct 28, 2007 12:28 pm) If your buyout is $21K, chances are that the dealer isn't giving you anything beyond that and possibly even below that. Think about it... if the buyout on YOUR car is $21K, in most cases, the dealer can negotiate a slightly lower price from the leasing company. On ANY car. So why would they give YOU that or higher when they can just as easily get it elsewhere? They're only going to do it if it is profitable. Dealers RARELY sell the cars that they take as trades (retail, that is). Most of the time, they'll simply put the car out to auction and some other dealer will buy it. About the only time they'll keep the car and put in the expense of fixing it up and selling it is if it is a very popular vehicle that they can easily sell, is in nearly perfect condition so it doesn't require much expense to put it into saleable condition, and if they got it for a great price and can sell it for a much higher price. So they're not going to be making as much as you might think on your vehicle because they're probably just selling it at auction. By the way, I looked up the KBB Trade-In values on a 2004 Honda Pilot (I'm assuming that's the year) and it is about $19K on the HIGH side in EXCELLENT condition. Like I said, most dealers aren't going to give you any better than "poor" value no matter what (and on a Pilot, that's about $16K). KBB is just not an accurate indicator of pricing. You have a point if there's excess wear and tear and excess mileage. You can probably calculate that and see how much it would cost you... it should be in your contract about excess mileage (and you can easily calculate how much mileage you'll expect to have at the end). You can also get an estimate from anyone on any damage to at least get an idea of what it might cost (and there's no law that says you can't FIX any "excess wear and tear" before turning in the car). Like I said, sometimes there's a financial reason for getting a new car early. As to leverage on a new vehicle and being able to shop around, how long is that REALLY going to take you? A month? Two? Surely not 7. So maybe you should hang onto your Pilot for another 5 months, have less of an overlap (money thrown out), and still have time to negotiate on a new vehicle and still be able to buy out your current lease to avoid excess mileage. |
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