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Leasing a vehicle
Posted on 8/18/15 at 9:02 pm
Posted on 8/18/15 at 9:02 pm
I have seen the WillCover and CoachGuidry threads on buying/financing vehicles. Always full of great information and I have used in the past.
Surprisingly, I am leasing a vehicle for the first time. Leaving the subtle brag out by listing the vehicle or cost, what are some tips for leasing?
How do I get most value? How do I reduce the capital cost to lower upfront payment due? Not even sure if these are best questions to ask.
Any help is welcomed oh MBers.
Surprisingly, I am leasing a vehicle for the first time. Leaving the subtle brag out by listing the vehicle or cost, what are some tips for leasing?
How do I get most value? How do I reduce the capital cost to lower upfront payment due? Not even sure if these are best questions to ask.
Any help is welcomed oh MBers.
3
Posted on 8/18/15 at 9:18 pm to SomethingLikeA
The only numbers that are negoitiable is the cost of the vehicle and the money factor (interest rate) . The residual is set by the manufacturer. Let it be known that some vehicles lease "better" than others. This makes it hard to compare apples to apples like when purchasing. The vehicle costs what it does and the interest rate is pretty much what it is when purchasing. In my experience the germans (especially BMW) generally lease better than American or Japanese cars dollar for dollar. Any particular reason you are leasing? Can you write it off as a business expense?
Posted on 8/18/15 at 9:20 pm to SomethingLikeA
edit: whoops double post
This post was edited on 8/18/15 at 9:21 pm
Posted on 8/18/15 at 9:28 pm to achenator
The money factor isn't really negotiable either. It's set by the lessor which is usually the finance organization of the manufacturer (e.g. BMW Financial). What can happen is that the sales/finance person at the dealer can up the money factor for their own profit. What you need to do is check the car forums and find out what the actual money factor is for the lease for the car you want. This can change every month along with the residual.
Also, never put money down on a lease (i.e. reduce capital costs). If the car got totaled the next day, you'd lose that. Just save the money and use it for monthly payments or invest it.
Also, never put money down on a lease (i.e. reduce capital costs). If the car got totaled the next day, you'd lose that. Just save the money and use it for monthly payments or invest it.
This post was edited on 8/18/15 at 9:37 pm
Posted on 8/19/15 at 12:08 am to SomethingLikeA
Stick to the manufacturer-sponsored advertised lease specials and don't deviate from them by adding features and packages. That opens the door for the dealer to juggle the numbers.
Be sure that your lease agreement provides Gap coverage in the event the car is totaled.
Be sure that your lease agreement provides Gap coverage in the event the car is totaled.
Posted on 8/19/15 at 7:28 am to Layabout
Check the sticky, there's links to lease threads. Some good ones.
Keep mileage down (consider prepurchase)
Don't put money down
Ensure GAP is provided by lease
Use Edmunds forum to find MF and residual. Most manufacturers list residual based in %, so options will residualize the same way.
Negotiate the vehicle price the same way.
Avoid trading a vehicle in for a lease. You lose the tax savings, and money down will be lost.
Avoid a security deposit and most fees.
Don't lease to purchase
Keep mileage down (consider prepurchase)
Don't put money down
Ensure GAP is provided by lease
Use Edmunds forum to find MF and residual. Most manufacturers list residual based in %, so options will residualize the same way.
Negotiate the vehicle price the same way.
Avoid trading a vehicle in for a lease. You lose the tax savings, and money down will be lost.
Avoid a security deposit and most fees.
Don't lease to purchase
Posted on 8/19/15 at 11:39 am to LSUtigerME
BMW has a Multiple Security Deposit program. For each security deposit (one monthly payment), it will lower the money factor by a certain amount. I think you can do up to 7.
I did this on my last lease and it saved me something like 1500 dollars over the life of the lease. You get the security deposits back at the end of lease.
It sucks tying up that money, but getting a risk free 11-12% return per year is great in my book.
I did this on my last lease and it saved me something like 1500 dollars over the life of the lease. You get the security deposits back at the end of lease.
It sucks tying up that money, but getting a risk free 11-12% return per year is great in my book.
Posted on 8/19/15 at 6:29 pm to gpburdell
First off, appreciate the kind words.
Im not too familiar with being able to negotiate money factors. Honda's is set in tiers of Credit Scores. But, other manufactures may do otherwise.
Leasing is great if you meet all the criteria. As the other poster said...leasing to own is not always a great idea. My guess is interest rates will rise in the next few years, so take advantage of the 0.9s and 1.9s while you can.
Good Luck with your purchase.
Im not too familiar with being able to negotiate money factors. Honda's is set in tiers of Credit Scores. But, other manufactures may do otherwise.
Leasing is great if you meet all the criteria. As the other poster said...leasing to own is not always a great idea. My guess is interest rates will rise in the next few years, so take advantage of the 0.9s and 1.9s while you can.
Good Luck with your purchase.
Posted on 8/20/15 at 6:52 am to gpburdell
quote:
BMW has a Multiple Security Deposit program. For each security deposit (one monthly payment), it will lower the money factor by a certain amount. I think you can do up to 7.
I almost included this is in my brief summary but didn't want to muddy the water. I've never done it personally, and I'm not sure how that affects it if you were to total the car. But yes, it can also be a good option.
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