Current Car Lease Deals

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Was looking at the Lexus GS Sport for around $469/mo and $0 down. Also saw that Audi was doing some $0 down, including an A6 for $515.

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Your monthly lease payments are determined by the selling price of the vehicle. You should try and negotiate a lower selling price on a lease, just like you would if you are buying a car.

1. Work to get as low a capitalized value as possible.
2. Get as high a residual value as you can (this affects your monthly payment).
3. Get as low of a money factor (this is your APR, multiply the money factor by 2,400)
4. Pay $0 down, $0 security deposit and $0 dealer fees.

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Your monthly lease payments are determined by the selling price of the vehicle. You should try and negotiate a lower selling price on a lease, just like you would if you are buying a car.

1. Work to get as low a capitalized value as possible.
2. Get as high a residual value as you can (this affects your monthly payment).
3. Get as low of a money factor (this is your APR, multiply the money factor by 2,400)
4. Pay $0 down, $0 security deposit and $0 dealer fees.

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This.

Read all the fine print in the ads to get these numbers. May have to calculate the "selling price" from the net capitalized cost, money factor from payments.

A MF less than .0012 and a residual higher than 60% would be heading towards a good deal. Incentives on top of this also helps.

Look for dealer contributions to net cap cost reductions. Those are equivalent to "cash back".

I have nothing against money down (try to minimize though since it's not equity), but no dealer fees or security. Acquisition fee is normal, but a 0 or minimal termination fee. Also, check if lessor includes GAP with lease.

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Was looking at the Lexus GS Sport for around $469/mo and $0 down. Also saw that Audi was doing some $0 down, including an A6 for $515.

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These promotions are usually BS on base models. Prepare to be disappointed.

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Acquisition fee is normal

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I have never charged a customer this. Ever.

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Just curious, do you roll into the lease, or waive it entirely?

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If its a previous customer; I'll normally eat the cost. If not...i'll leave it up to the customer. Honda Financial is one of the most strict lenders out there; so I'm usually dealing with 720+ Scores when dealing with leases.

Is a lease ever really a good deal versus owning other than the benefit of a new car every X years?

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Is a lease ever really a good deal versus owning other than the benefit of a new car every X years?

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“The worst vehicle accidents happen on a show room floor.” – Dave Ramsey.

Depends on each person's situation, but generally speaking, no.

Leasing provides a good deal for four parties - the sales person, the F & I guy, the dealership’s owner and the finance company (leasing company). It is a lousy deal for the customer. You owe something, but you own nothing. Leasing adds a layer of complexity to the deal that allows the salesman to hide or misrepresent the true purchase price.

Leasing has become an incredibly effective tool for dealers to sell their product at a significantly higher price and profit margin and is often “pushed” or “encouraged” through the sales process.

• Leasing makes the car more affordable and therefore easier to sell. The buyer gets focused on being able to drive a nicer vehicle for a lower monthly note than what they most likely could not afford to buy.

• It allows the customer to afford a more expensive car, and the more expensive the car, the larger the profit.

• Leasing allows the dealer to legally hide the true cost/price of the vehicle and charge you a higher price than you would normally agree to.

• A leasing customer is more likely to return to the same dealership to get their next vehicle and next vehicle and next vehicle. Even though your original sales person will be long gone, the dealership is able to maintain customer retention and that’s where it pays off in the long run.

Unfortunately, most people are quick to answer a sales person when he/she asks if they’re planning to buy or lease a vehicle. As soon as you give away that you’re planning to lease, the price of the vehicle (capitalized cost) will freeze up. You’ve essentially lost any leverage you had at this dealership. You should negotiate the price of the new vehicle as if you’re going to pay for it with cash out of your own pocket and then bring that over to the lease.

Leasing is a convenience that you’ll pay for in the end. Put another way, if you can’t afford to buy your next vehicle with a four-year loan or less, then you really can’t afford it. The better deal long-term is to buy a reliable vehicle (good, late model used vehicle or lower priced new vehicle) and hold onto it as re-leasing every three to five years is no way to build wealth.

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Leasing is a convenience that you’ll pay for in the end. Put another way, if you can’t afford to buy your next vehicle with a four-year loan or less, then you really can’t afford it. The better deal long-term is to buy a reliable vehicle (good, late model used vehicle or lower priced new vehicle) and hold onto it as re-leasing every three to five years is no way to build wealth.

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While I agree with your points in this post, I feel it misrepresents the value of leasing to a well informed, well prepared buyer. For John Doe off the street, these tactics are effective to sell a vehicle quickly because it does make it more affordable. However, it's not the "rent" or "Owe Something, Own Nothing" approach you preach. It does allow the dealer to hide things buying does not, but a well educated consumer can ask the right questions and get that information. The exact same thing with purchasing. Financing a vehicle is the same "owe something, own nothing". That car belongs to the finance company until you have paid it off. The exact same risk applies.

Leasing is only beneficial to the consumer that WILL TRADE ON A 3-4 year cycle. If you will be rotating vehicles often, then leasing basically allows you a guaranteed cash flow (lower as well) with a guaranteed buyer for your used vehicle at the end of the term. It's an alternative way to finance a vehicle, and in fact some credit unions offer this through their financial services (not recommended since it is a balloon payment and not a secured value at end of term).

If a new vehicle is something you must have often, then leasing vs purchasing is not gonna "build wealth". If this is the audience, not the "buy used regardless" crowd, then leasing can be financially advantageous. You just need to run the numbers for your particular deal. The money factors and residuals on particular models can swing the argument in favor of leasing or purchasing.

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Based upon my own research and people I associate myself with, I would have to say that the number of uninformed buyers far outweigh the number of informed buyers.

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I certainly agree, but I don't feel this is the audience. We're addressing people that ARE doing the research and seeking the knowledge to make an informed decision. Not the average car buyer walking in off the street with nothing.

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Unless a person does this very often, even the most informed buyer won't know to everything there is to know about capitalized cost, capitalized cost reduction, acquisition fee, disposition fee, excess wear & tear, money factor, open end lease, closed end lease, residual value and security depo

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While going through the it helps, enough research and patience can certainly get you there. I spent hours researching my first lease (through Honda) and walked in with a half full notebook, various printouts, and sample calculations. Every number we discussed I personally verified the calculations. Now, with most research and shopping done online, it's even easier. I use my own calculator to run all the numbers and verify the payments, taxes, etc. the dealer should be willing to provide ALL the variables that go into the lease. Typically, I find I know more than most of the dealers and salesmen themselves. I've been asked about my spreadsheet multiple times as it can provide better details than they know to look for.

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An inflated residual value lowers your monthly payments, but it can also handcuff you. A more realistic residual value will make it easier to sell the lease, trade your vehicle in the middle of the lease or buy the vehicle at the end of the lease. Many people get lured in by the low initial payment, but should beware that all the financial factors that go into leasing, including trading in your current vehicle to obtain a new leased vehicle will effectively ensure your monthly payment will be much higher in subsequent leases. This makes it hard to break the cycle and purchase future vehicles with a sizable down payment.

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I agree with this. However, a "too high" residual is also something a dealer is not willing to eat. So unless you are married to that exact car, you can turn in the vehicle, let the dealer eat the cost, and lease or purchase a new vehicle or a similar used (for less than your resodual). This is the value of a closed end lease, you cannot be screwed into a balloon payment at termination.

I mentioned the trade-in and equity being applied not favoring leases. This will be lost entirely in the first lease, and set up future leases for disappointment. You also lose the tax credit on trade-in, assuming you live in a state that only charges tax on the payment.