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You are in the Prices Paid - Buying & Leasing Experiences
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Car Buying, Car Leasing
#1 of 46 How to Negotiate a Good Deal on a Car Lease
Dec 02, 2010 (5:01 pm)
The following guide explains how to negotiate an attractive deal on the vehicle that you want to lease.
Step 1: Determine if you are a good candidate for leasing.
Leasing isn't for everyone. If like to get a new vehicle every couple of years and keep your driving to around 15,000 miles per year or less, then leasing may be for you. On the other hand, if you generally keep your vehicles for a long time or put a ton of miles on them, you may be better off financing or paying cash for your new vehicle.
Step 2: Decide what vehicle you want.
Next you need to decide what vehicle you want to lease. Do some research on-line on sites like Edmunds.com and develop a list of possible candidate for your new vehicle. Then go to a few dealers and see the vehicles in person. While reading reviews about vehicles is great, it's no substitute for seeing a car or truck in person and driving it. Make sure not to finalize a deal with any dealer before researching how much the vehicle you want should cost.
Step 3: Decide how long a lease you want.
Once you know what vehicle you want, you have to decide how long you want to lease it for. Generally speaking, the longer one leases a vehicle for, the lower its monthly payment will be. There are exceptions to this rule, but this is usually how leasing works because with longer leases one is able to spread the large initial depreciation hit that vehicles' experience out over a larger number of payments. The "sweet spot" for most new vehicle leases is usually 24 to 39 months. These are the terms that manufacturers usually provide lease support on. One really shouldn't lease for any longer than 48 months or so. Four years is a long time to be committed to a single vehicle. Over the course of four years, your life could change, causing you to need a larger vehicle, or put many more miles on your vehicle than your lease allows.
Step 4: Determine what mileage allowance you need.
Now you need to decide how many miles per year you will need to drive your leased vehicle. The higher your leased vehicle's mileage allowance is, the higher its monthly payment will be. Most people drive from 12,000 to 15,000 miles per year. The majority of banks that lease new vehicles offer 10,000, 12,000, and 15,000 mile per year leases. Some banks offer more options and some offer fewer. If you need to drive more than 15,000 miles per year, you will probably have to purchase additional miles on a per-mile basis. It is usually less expensive to do so at lease signing than it is to wait until lease-end and have to pay an excess mileage penalty.
Step 5: Negotiate an attractive selling price.
One of the most important numbers to focus on when leasing is the selling price of the vehicle that you want. Always remember that the selling prices of leased vehicles are negotiable, just as if you were paying cash for or financing them. You should be able to get a good idea of how much you will have to pay for the car or truck you want by looking up its Edmunds.com True Market Value, and by visiting the "Prices Paid: Buying & Leasing Experiences" forum at Edmunds.com to see how much community members there have paid for similar vehicles lately.
Step 6: Find out what your vehicle's money factor should be.
Now that you know how much you want to pay for your new vehicle you need to find out what sort of lease program is available on it. Manufacturers' captive finance companies, banks that are owned by automakers, often have the most attractive lease program for cars and trucks. This is because the manufacturers provide special low lease money factors on vehicles to make their payments attractive so that they can sell more units. It is important to know what the "buy rate" lease money factor is for any vehicle that you want to lease. The "buy rate" is the number that is published by the bank that you want to lease through and it is the lowest possible money factor that is available on it. One should know this number when leasing because dealers often have the authority to "mark-up" vehicles' money factors to add additional hidden, back-end profit to deals. You may be able to find out what the current lease program is like for the car or truck that you want by paying a visit to the aforementioned "Prices Paid and Lease Experiences" forum at Edmunds.com.
Step 7: Finalize your deal.
Now that you know how much you should pay for the vehicle you want and what its money factor should are in good shape because these are the two main profit centers for dealers on leased vehicles. Comparison shop with a few dealers in your area to get an attractive price on the vehicle that you want and have the dealer that you decide to lease from calculate your vehicle's monthly payment using its "buy rate" lease money factor.
Step 8: Enjoy your new ride.
Now that you've negotiated an attractive deal on the car that you want, drive it off the lot and enjoy...just make sure not to pick up any speeding tickets .
Prices Paid: Buying & Leasing Experiences Forum
#2 of 46 very important to do when leasing a car
Jan 09, 2011 (9:29 pm)
1. Make a list of 2-3 cars in the same class , that you like and you would enjoy leasing .
Most people don't know this , but just because 2 cars have the same MSRP , does not make them lease the same .
FOr instance , the Mercedes ML leases for under 500/month with zero down at this time and the ar has a 52k MSRP ; The same MSRP BMW X5 will lease for over 100 more ...so if you have both cars on the list , then it will be an easy choice
2. Decide what car leases the best and go for it
* Auto Brokers are usually a good way to shop for a car , as they can help you compare more that one brand in the same place , and usually a broker will give you a straight answer when it comes to vehicle comparasing
I hope it helps,
#3 of 46 Leasing brokers
Jan 25, 2011 (8:32 am)
We always leased our cars through the dealers, but when our current lease was up we decided to also try a leasing company.
I was cautious going through the process with a broker, as everything is done over the phone, but was totally impressed by the experience.
As previous poster mentioned, brokers are more direct and give you the price which is better than any dealer "best deals". We started with few dealers and thought we negotiated the best price, but broker came in at lower payment for the same car.
I also appreciated that with a broker we didn't have to deal with sales agent going back and forth to his finance manager for the price, I am tired at that game.
Brokers are also great in comparison shopping, if you are not decided on the car you want. They give you lease prices on several similar cars and also alert you on any specials in effect.
The drawback of going through the broker is that you are not able to see and drive the car, but you can stop at you local dealer showroom and see the car in person.
And to top our pleasant experience - the car was delivered to our door
#4 of 46 Re: Leasing brokers [car_dude]
Jan 25, 2011 (10:47 am)
I guess that the main reason why people chose a broker instead of the dealer is because of the process. It is just a big waste of time dealing with salespople at a dealer and it almost always cost you money .
There are places like this one http://www.lease-specials.com that show you prices upfront without the need of pulling credit and going to the dealer , and this makes the car buying experience simple and painless
#5 of 46 Re: Leasing brokers [daniel12304]
Jan 26, 2011 (8:00 am)
Our leasing broker has deals listed on their web page, so one can check the deals and have an idea on pricing before talking to the broker.
There are quite a few of leasing broker in business, I am surprised they are not as popular as brick & mortar car dealerships.
Jan 31, 2011 (8:53 am)
I'd love to get some more info on Lease Broker's? Are there any National Agencies that part take in this?
#7 of 46 Re: Lease Broker's? [millemiglia]
Jan 31, 2011 (10:14 am)
Any Auto brokerr will have the same license as a car dealer , so all brokers are regulated in the basic same way by the DMV.
There are a couple big ones in southern California like Carsdirect or http://www.bestcarpurchase.com/
that you can use to shop online , plus manny more local nitch auto brokers serving their local communities; It is very typical for the korean community to have a local korean broker , or the armenian community and so on .
#8 of 46 Re: Lease Broker's? [millemiglia]
Jan 31, 2011 (1:04 pm)
Keep in mind that even if you work with a broker, you will be getting the car through a dealership.
It will be the the dealer who will complete paperwork on your lease and deliver the car to you.
#9 of 46 "I'm not doing this deal on a loss"
Mar 02, 2011 (6:50 am)
This happens without fail every time I'm looking to get a quote on a car.
I'll get a legitimate quote from a dealer or through Zap.com on Consumer Reports, and take that quote to another dealer.
And their reply will be: "Thank you for the opportunity but again I can not touch that-if a dealer is willing to take a loss on his vehicle than so be it-good luck I hope it turns out well for you."
Something about that line seems fishy, as if to give you a phony guilt trip or something.
Any thoughts on this?
#10 of 46 Re: "I'm not doing this deal on a loss" [plasticmoonrai]
Mar 02, 2011 (6:25 pm)
One dealer's loss may be a deal for anther dealer , or for an auto broker for that matter. Diffrent dealers get different incentives from the factory based on volume and volume of sales for the previous month .
So when a dealer tells you that they cannot do the price , they probably don't want to do that price because of a small proffit (keep in mind that the salesman gets a percentage of the proffit , so he may not be interested in selling a car for a mini deal of 50$ or 100$) , or simply that dealer did not meet the quota last month and they don't have all the incentives from the factory .
That's about it for today ,
Only advice : Use an Auto Broker when buying a new car , or be prepared to do the research and shop at least 5 dealers , to make sure that you get a good price . Also just because a website told you a price , does not meen that is a good price for thatmonth . I have seen sites like truecar that give a average price , and we could beat that price by more then 5.000 so it is all relative because incentives change on a monthly basis for most cars .