| ndahbar |
Hi all. A friend of mine was telling me about their experience and this raised the questions I present to you. This friend was intending to lease the new Audi S4, and the lease quote obtained from the dealer was REDICULOUS. I mean this is a car worth about 52-53K and they want OVER $900 for a 2-year lease. This is with $5K down !!!!!!
At the same time, this friend's brother is wanting to lease an M3, which with his options, is MORE expensive than the Audi, but the dealer is able to do it for a little over $700 a month for 2 years.
I don't understand the effects of demand/supply on the lease rates. One would think that high demand = high value retention = good lease rate cuz a big chunk of it is based on the residual values. BUT at the same time I guess if the supply is low (which it is with the Audi) then the demand is automatically high, and you'd think the same would apply, but in fact it seems they just jack up the price because...well, because they can? Hence capitalism.
I calculated how much this audi would be on the website with the same money down I put on my 'X and the lease length, and it's well over $200 a month more. So I have no idea why the heck a car that costs a ~11K more than mine is going for a LOT more money. This is an S-car....these are in high demand. What's up?
Lastly, this friend of mine has very good credit history, in fact they leased an Audi S4 before. Oh one more thing, they went to another dealer that was able to shave it down to like the low-mid 800 range. Still, seems a lot. |
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| Sir P |
| Can't provide qualified help. Just wanted to say that low-mid $800 a month sounds ok for $53K car 2-year lease. I was pricing a $55K car once, got $900+ per month for 2 year lease. I did not end up getting it though. |
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| Albert |
There are two reasons why it may happens:
-- low residual value (I looked at BMW leases, to begin they start at 10k miles/year and then go significantly higher with 12k and 15k) there is nothing you can do about it
-- high money factor (it comes from the Audi leasing company) one should be able to shop around and see if a better deal from other leasing companies out there. Keep in mind, that there are perks and terms that you can loose if you go outside. For instance, Acura gives $1500 allowance for damages or excessive wear when you bring you car back, etc.
Additionally, the shorter your lease the bigger hit you take on the depreciation: 1st year is the worst, 2nd a bit better, etc.
I leased my X for 48 months/15k for $601/m with $1700 down, that includes all of the fees, gap insurance, title, tax, etc. |
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| Sir P |
quote:
Originally posted by Albert
...For instance, Acura gives $1500 allowance for damages or excessive wear when you bring you car back, etc....
I did not hear about this allowance. Is that an option you should ask for when getting a lease from Acura? |
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| Albert |
| It's a standard clause in the Acura lease. You should be able to find it on the Acura website in the lease section (I think I've seen it there as well). |
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| ndahbar |
Thanks Albert. In all honesty, I did know about all those contributing factors to a lease, but the enthusiasm in me just didn't let me believe that a car worth a mere 10 or 11K more than mine is SOOOO much more money per month, even with a much larger down payment! Then again, 2-year leasing hurts (mine is 4).
In fact Albert, my lease rate is suprisingly close to yours. 581 per month for 48 months, about 1700 down total including everything, but I have 12K per year versus your 15K. I did it through Chase Manhattan Bank, which by the way have the same $1500 allowance towards damage. I don't have the very best credit in the world, but it's quite good, so anyway I didn't like Honda's lease rate so I told the manager to find me something better within 24 hrs and he did. Of course keep in mind that interest rates (money factors) vary month to month, nothing any of us can do anything about that, so you may end up paying more than your neighbor just cuz he or she bought a month or two before/after you did.
Anyhow, I have a question, just wanna be certain of this. My allowance is 12K per year, but I BARELY can drive 8K per year. When I return my car, I anticipate a MAX of 32-34K total at the end of the 4 years. Will I get a nice big fat check from Chase at the end? I remember the business manager telling me it's my choice, a check, or credit towards a new Acura if I want. |
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| Albert |
Ndahbar,
It’s hard to say, it depends on the lease that you signed and the dealer that you will bring your car back to. I know when you lease Acura from Acura (Honda Motor Co.) they charge you 10c/mile if you prepay. For instance in my lease should be $1,200 more expensive than yours (4 years x 3000 miles x 10 cents). However, if I didn’t prepay, they’d charge me 15c/mile when I bring my car back - $1,800 instant charge (as opposed to $1,200 over 48 months). Thus, theoretically, you could get $1,600 when you bring your car back, but you need to check with your leasing company and a dealership about it in advance. The other option is to buy your car at the end of the lease at the residual cost (no penalty if you leased from the Honda corporation), and sell it on your own. Therefore, you have some options; you just need to figure out what exactly is going to happen at least 2 moths before your lease ends. |
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| peterb |
I would not count on getting any money back from Chase.As a matter of fact they will try to find anything wrong with the car,call it excessive wear and tear and charge you for it.
BTW just leased my new MDX 04 for 36 months,12k miles a year,no out of pocket expenses for $575 per month. |
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| Albert |
Peterb,
It sounds like you got a great deal on your car, but the fact that you paid $0.00 upfront sounds a bit suspicious. You didn't have any trade-in nor end of lease exchange? Didn't pay for a first month nor for a registration? What kind of trim level and options did you get? |
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| peterb |
Albert
To answer your question I have to explain the new leases avalable in NY.Due to few stupid lawsuits banks changed leases in such a way that you are the title holder not a bank.You do not pay acquisition and disposition fee,your taxes and registration (in NY about $75)are rolled in.GAP is included free of charge.Your first payment is due 1 month after getting the car-no upfront charges.At the end of your lease you may return the car, buy it or since you are the title holder trade it in (if for example market value is higher than residual).Actually you can trade in your car anytime during your lease.
Seems to me that it offers the best of both worlds-leasing and buying.
Peter |
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| peterb |
| Forgot to add:it is 04 base MDX with dealer installed roofrack,side steps,BSM,rear spoiler and wheel locks.Got all of it free of charge.Final price was about 38k. |
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| Albert |
Peter,
Thank you for your explanations. Now I understand it much better. Unfortunately, we don't have these options here. You got a great deal on your car and excellent terms on your lease, enjoy! |
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