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Leasing a car
None | 01/07/2013 | Hingle McCringleberry

Posted on 01/07/2013 1:18:27 PM PST by Hot Tabasco

I have questions on how a dealership calculates a lease payment on a new car


TOPICS: Chit/Chat; Miscellaneous
KEYWORDS: autos; leases; vanity
I contacted my local Honda dealer for a lease quote on a 2013 Accord EX-L coupe and they responded with a figure of $389 per month.
1 posted on 01/07/2013 1:18:29 PM PST by Hot Tabasco
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To: Hot Tabasco

I did it once, never again.
The car depreciates faster than your payments pay down the lease. I ended up paying another 8k at the end.
Save yourself some grief/$$$ and buy a 2-3 year old model.


2 posted on 01/07/2013 1:24:18 PM PST by Zathras
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To: Hot Tabasco

Basically you are renting a car until they make you buy most of what you could have bought it for new.


3 posted on 01/07/2013 1:25:24 PM PST by BenLurkin (This is not a statement of fact. It is either opinion or satire; or both)
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To: Hot Tabasco

Had this just last week. I have never leased so I thought it would be interesting for a fun weekend car. She wanted a Fiat. I was getting crazy numbers for that car, basically $365 a month for a two year lease. He finally slipped and stated “we take the sticker and divide by the time involved and depreciation.” Sticker.


4 posted on 01/07/2013 1:27:39 PM PST by doodad
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To: Hot Tabasco
Price-"end of lease value"/term plus interest rate. You could theoretically get a lease of $1/month if they have a highe end of lease value on it. Of course with the depreciation you would be stuck forking over $1000(0)'s.

Avoid if you can unless you know you want to purchase the vehicle after the end of the lease.

5 posted on 01/07/2013 1:28:15 PM PST by Chipper (You can't kill an Obamazombie by destroying the brain...they didn't have one to begin with.)
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To: Hot Tabasco
I'm on my second Honda since 1985 and am ready to get a new one but this time, due to my age and limited savings, I need to go with a lease.

I contacted my local Honda dealer via email over the weekend and asked for a quote on an Accord EX-L coupe, with a MSRP of $28,785.00 according to the Honda pricing website.

This was a 3 year lease, 12k per year with nothing down. The sales manager responded with a quote of $389.59 per month.

So here's the kicker, I went to several internet sites that offered lease calculations and based on the MSRP, months of lease, sales tax included, the highest payment I came up with was approx. $221.00 per month.

So what is the dealership factoring in that would create a $160.00 per month discrepancy in the monthly lease payment?

I appreciate any good advice and will take all expected others with a grain of salt...........Thank you

6 posted on 01/07/2013 1:29:17 PM PST by Hot Tabasco (Jab her with a harpoon.....)
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To: Hot Tabasco
So what is the dealership factoring in that would create a $160.00 per month discrepancy in the monthly lease payment?

How stupid they think you are.

7 posted on 01/07/2013 1:31:48 PM PST by E. Pluribus Unum (TYRANNY: When the people fear the government. LIBERTY: When the government fears the people.)
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To: Hot Tabasco
The auto/finance company makes assumptions as to the residual value of the car at the end of the ease, and also their cost of money, on which the interest rate they use is calculated. The number is what it is. You have to first decide if it's within your budget, and if you can afford the upfront initial payment, whatever amount it may be. You then have only two concerns:

1. that you stay under the specified mileage of the lease (excess mileage can be very costly, and make what seems a good deal end up as a very expensive deal)

2. That you take good care of the car..especially outward appearance, dents, chips, paint discoloration. You will be charged through the nose for these items at the end of the lease.

Of course, if you are planing to buy the car at the specified price at the end of the lease, then you don't have to worry about either of these.

8 posted on 01/07/2013 1:32:26 PM PST by ken5050 ("One useless man is a shame, two are a law firm, three or more are a Congress".. John Adams)
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To: Hot Tabasco

Try other dealers.


9 posted on 01/07/2013 1:34:36 PM PST by listenhillary (Courts, law enforcement, roads and national defense should be the extent of government)
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To: Hot Tabasco
... hee hee
10 posted on 01/07/2013 1:34:57 PM PST by evets (beer)
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To: Hot Tabasco

You’re not limited to your local dealer. You’re also not limited to full sticker when determining lease payment. Work your deal, get your price then discuss payment. Price to lease, with a number of options, versus price to purchase, with a number of options, including down payment or no.

Then, shop it, hard. They’re taking you for a low information person who will just pay what they’re asking.

Run it through the lease calculator on the Honda website and see what you come up with, not this I’m pretty sure.


11 posted on 01/07/2013 1:39:08 PM PST by RegulatorCountry
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To: Hot Tabasco

Avoid leasing unless you can write it off. Also, watch the mileage limitations. Most leases have 10,000 miles per year in teh lease. You’ll pay 20-30 cents per mile for everything over.

I’ve leased before and it is a poor financial move. Buy the car or get something 2-3 years old.


12 posted on 01/07/2013 1:39:32 PM PST by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Zathras
I understand what you're saying but I'm wondering if location has anything to do with it.

I'm in the metro Detroit area and my neighbor recently turned in her Mercury Millan at the end of her lease and was given a Lincoln MKS, 2 year lease, 10k per year, for $300 per month and no down payment...........

I'm also looking at a 2013 Buick Regal Turbo being offered for $249 per month, 10k per year and -0- down........This lease amount, by the way, is consistant with an online payment calculator whereas the Honda lease was not.......

13 posted on 01/07/2013 1:41:45 PM PST by Hot Tabasco (Jab her with a harpoon.....)
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To: Hot Tabasco

If one MUST buy a new car for whatever reason, they are better off in the long term to get the thing, maintain/take good care of it, pay it off as quickly as possible, and drive it until the wheels literally fall off.

The people that buy new and trade in for another every 2 or 3 years are total idiots, IMO. They are just paying interest during the time of highest depreciation, and chances are it will be ‘under water’ when they go back for the trade in. No worries though. They are totally HAPPY to just tack that negative equity onto the new loan, making someone REALLY upside down before the ink even dries on the contract and the are keys handed over.

The whole business of buying cars is just INSANE!


14 posted on 01/07/2013 1:45:25 PM PST by KoRn (Department of Homeland Security, Certified - "Right Wing Extremist")
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To: Hot Tabasco

Dave Ramsey says its a great idea...So I say go for it...sigh...


15 posted on 01/07/2013 1:45:51 PM PST by Rightly Biased (Avenge me Girls AVENEGE ME!!!! ( I don't have any son's))
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To: Hot Tabasco
Your estimated lease payment from "internet sites" is way too low.

For example, the trade-in value of an EX-L coupe with 36,000 miles (2010 model) has a Blue Book trade-in value of around $15,500. That's over $13,000 of depreciation that the lease payments would have to cover on a 3 yr.-36k lease.

$13,000+ divided by 36 months is $369 a month, then the lease has to factor in the time value of money and a reserve for bad debts.
16 posted on 01/07/2013 1:46:58 PM PST by kenavi (Lost the country? Win your state.)
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To: Hot Tabasco
I saw the isnide of auto leasing biz many years ago. Unless things have changed in the last 20 years my adivce is don't.
17 posted on 01/07/2013 1:49:44 PM PST by BenLurkin (This is not a statement of fact. It is either opinion or satire; or both)
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To: Hot Tabasco

My friend and I have sent each other car lease ads that reflect the growing trends for dealerships such as : Posche Turbo for lease $119.00/mos x 5 years. Based on $180k down, 860 Fico score, $5 mill. net worth statement, 0 miles per month, $5k/per engine startup fee and you must leave car at dealership for duration of lease.


18 posted on 01/07/2013 1:49:44 PM PST by Cyman
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To: driftdiver
Buy the car or get something 2-3 years old.

I've only purchased 5 new vehicles in the past 38 years, with only two in the past 28 so I've gotten my worth of cars. Like I said, based on my age, and the limited driving I do now that I'm retired, leasing a vehicle is the best option for me.

19 posted on 01/07/2013 1:53:59 PM PST by Hot Tabasco (Jab her with a harpoon.....)
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To: Hot Tabasco

you’ve got the FEVER.

been there, done that, best of luck to you my friend


20 posted on 01/07/2013 2:00:59 PM PST by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: Hot Tabasco

Roughly:

List price of car - estimated value at end of lease / number of months of lease term = monthly lease payments.


21 posted on 01/07/2013 2:01:55 PM PST by Yo-Yo (Is the /sarc tag really necessary?)
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To: Zathras

It was only good if you owned your business.
No longer a good idea.
Free country.


22 posted on 01/07/2013 2:02:52 PM PST by Morris70
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To: Zathras

“I did it once, never again.
The car depreciates faster than your payments pay down the lease. I ended up paying another 8k at the end.”

What? That’s not right. The good thing about a lease is you don’t have to worry about depreciation. Unless you had an open end lease that are no longer in existence. Closed end leases have a “guaranteed future value” the residual that the lease co. is responsible for.


23 posted on 01/07/2013 2:07:05 PM PST by saleman (!!!!)
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To: Hot Tabasco
I contacted my local Honda dealer via email over the weekend and asked for a quote on an Accord EX-L coupe, with a MSRP of $28,785.00 according to the Honda pricing website.

...

So here's the kicker, I went to several internet sites that offered lease calculations and based on the MSRP, months of lease, sales tax included, the highest payment I came up with was approx. $221.00 per month.

I don't see how you can get a $221 per month lease on that car. Even if you get 0% interest on it, they are essentially saying that there is only a difference of $7,956 between the new car and the car after three years. A 2010 Accord EX-L with 36,000 miles on Kelley Blue Book was listed at $15,572 for an excellent trade in ($17,462 for private sale). AOL listed its MSRP at $26,080.

24 posted on 01/07/2013 2:09:23 PM PST by KarlInOhio (Choose one: the yellow and black flag of the Tea Party or the white flag of the Republican Party.)
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To: kenavi
For example, the trade-in value of an EX-L coupe with 36,000 miles (2010 model) has a Blue Book trade-in value of around $15,500.

Now that makes sense. I never factored in the drastic depreciation cost of the vehicle after 3 years and that's why the calculator I used came up with such a discrepancy between it and the dealer.

Here’s the calculator I used

25 posted on 01/07/2013 2:15:02 PM PST by Hot Tabasco (Jab her with a harpoon.....)
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To: KarlInOhio
A 2010 Accord EX-L with 36,000 miles on Kelley Blue Book was listed at $15,572

See my post #25......you're absolutely correct.

26 posted on 01/07/2013 2:19:36 PM PST by Hot Tabasco (Jab her with a harpoon.....)
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To: Cyman
: Posche Turbo for lease $119.00/mos x 5 years. Based on $180k down, 860 Fico score, $5 mill. net worth statement,

I saw it and almost went for it but turned it down since they're lousy in snow and winter is now here..........

27 posted on 01/07/2013 2:21:54 PM PST by Hot Tabasco (Jab her with a harpoon.....)
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To: Hot Tabasco

There are pros and cons to leasing. If you want low monthly payments, no out of pocket $, and you don’t drive more than 15k miles/yr. There are usually no repair costs because most leased cars are offered with warranties. If you buy new the depreciation is severe if you sell the car within 4/5 years. Any our of warranty problems can be costly. There are just too many variables to consider so you might want to speak with your accountant.


28 posted on 01/07/2013 3:33:09 PM PST by Son-Joshua (son-joshua)
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To: KoRn
The people that buy new and trade in for another every 2 or 3 years are total idiots, IMO.

Heh. When I was a young-skull-full-of-mush just out of college with my first decent-paying job, I had to have a new car every two years or so.

Then, in '84, I was front-ended in my brandy-new Bronco [oh, how I loved that truck]. It was totaled -- I survived and a switch clicked in my brain that made me realize they're all just a hunk of metal.

I still love vehicles, but haven't bought a new one since. Have had great cars and trucks -- can't complain about a one of them. And, boy, have I saved a ton of money.

29 posted on 01/07/2013 4:33:13 PM PST by BfloGuy (Money, like chocolate on a hot oven, was melting in the pockets of the people..)
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To: BfloGuy

Heh.... Don’t go TOO hard on your young self...

At least cars weren’t so crazy expensive back then, in relation to wages/pricing.


30 posted on 01/07/2013 5:51:45 PM PST by KoRn (Department of Homeland Security, Certified - "Right Wing Extremist")
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To: Rightly Biased

I think you forgot the sarcasm tag. Dave actually calls them “Fleeces”


31 posted on 01/07/2013 8:26:23 PM PST by representativerepublic (...loose lips, sink ships)
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To: representativerepublic

Did I really need the sarcasm tag?


32 posted on 01/08/2013 5:28:09 AM PST by Rightly Biased (Avenge me Girls AVENEGE ME!!!! ( I don't have any son's))
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