waltaz

I'm looking at both the RDX and EX35. The manufacturer's have the following incentives for March:
- Acura: $1500 off for a lease, and they will go off of INVOICE (don't go a penny more)
- Infiniti: Super-aggressive money factor on 24-month leases (.00025 vs. .00074 for the RDX); better residuals than Acura (63% for EX vs. 58% for RDX)

Factor all this in and assuming the following:
- RDX Tech MSRP is $37,410 and cap cost is $33,229 (I have to add $300 for marketing in AZ)
- EX35 Journey RWD (with Nav, Premium, Luxe Style, Roof Rails, Cargo Protector) MSRP is $41,485 and cap cost is $37,868
- 18K miles/year, reducing residual amounts by $600 (3000 miles/year x 2 years x .10/mile)
- No fees rolled in to the cap cost
- No cap cost reduction

The monthly payments, before tax, work out to be:
- RDX: $545.66
- EX35: $529.68

Umm...fricking WOW!!

Tripp11

Since this appears to be an indicator that you prefer the EX35, why not post this over at freshalloy and hang over there?

oasis3582

SH-AWD >>>>>> RWD....nuff said

LaZyPiGgY

I think he is merely mentioning the fact that he got a good deal on a car that others are also interested in comparing the RDX too. Good info to know.

waltaz

Exactly...and I'm not sold on the EX...yet. I keep whipsawing back and forth on the two damn vehicles...

Type34

We've leased many vehicles over the years and I strongly suggest sticking with the 36-month leases. I could write a novel on the merits of a 36 over a 24-month lease, but consider the following...

The Acura-sponsored 36mo lease is $399/mo (+ tax) with $1,999 total due at signing for a 2008 RDX Tech (valid thru 04/30/08). 10K/miles a year with a residual of $19,827.30. This is your starting point when you negotiate with your local Acura fleet manager (wave to the salesmen as you go to sit down with the guy who can actually work with you on this deal).

It may you, but 10K miles a year doesn't bother me be because 1) I always sell my leased vehicles privately (or trade) prior to turning them in and 2) Acura's resale value allows you to sell/trade comfortably above/at the residual. If 10K/yr bothers you, negotiate a higher mileage...obviously everything is negotiable and working with the corporate-sponsored lease as the starting point removes any surprises.

Case in point: Feb06, Acura offered $399/mo (+ tax) with $1,999 total for a 2006 MDX (base). Sent a few emails, sat down with the local fleet manager, leased our 2006 MDX Touring with navigation for $416 + tax with $1800 total down (10K miles a year)...residual: $23,800. The deals are out there...don't pay $546 + tax for an RDX for only 24 months...

waltaz

Duly noted, but two things:
- I know I will go over 15K miles/year, probably closer to 20K, but I can manage it to 18K. Buying the miles upfront for $.10/miles is far, far cheaper than going over and paying...what, $.25/mile when you turn it in.
- Every piece of advice you ever see on leasing says to never, ever put money down upfront. You seem to know alot about it; why do you put money down?

Walt

waltaz

Also, what's the Cliff's Notes version of your novel? Why so adamant about 36 vs. 24 months?

Type34

Walt, I sell my vehicles privately, so mileage allowance is irrelevant to me unless I plan on actually turning the vehicle back into Acura when I'm done with it. I'm not saying this is the tried-and-true leasing method for everyone, but this system works for my family...

My lease process:
1) Locate Acura model (i.e. a vehicle with high resale value)
2) See if there's a corporate-sponsored 36-mo lease program
3) Using that program, negotiate the lowest monthly payment and cap reduction as possible (never pay more than $1999 for a cap reduction) on the optioned-out model we chose
4) Take excellent care of the vehicle and document every service record
5) About 33 months into the lease, prepare to sell the vehicle privately
6) Sell the vehicle around $1500-2000 above the residual amount (why #1 and #4 are important)
7) Use that $1500-2000 for the next lease vehicle's cap reduction

I detailed cars as a side-job through college, so our cars are always immaculate and I'm anal enough to have a detailed Excel spreadsheet on every car we own. For the last three cars I've sold, the first buyer that came to look at the vehicle bought it immediately.

Like I said, not for everyone, but it works for us...

Tripp11

How do you get around paying sales tax? Does the dealer facilitate for you?

Tripp11

Clearly, the Infiniti wins w/ the money factor, residual and you get a higher priced vehicle for less per month. If you like both equally well, it would appear it's a no brainer as the EX deal is much better.

Perhaps is is good info if people are cross-shopping the two.

MMike1981

my only question, what are you doing leasing 18k/a year....why not look to buy the car...?

Type34

In #7, I misrepresented by saying "cap reduction" and instead should have said I use the $1500-2000 for the "total drive off" required for my next lease.

The $1800 check that I wrote the dealer for our 2006 MDX included the first month's payment, license fees, dealer fees, and the tax on the first month's payment. The only tax you pay during the duration of the lease is for what you use...so you only get taxed on the monthly payment.

That's why I prefer leasing over buying because you're taxed and financed (money factor) based only on what part of the depreciating asset (vehicle) that you use. Not trying to turn this into a lease vs. buy debate

MMike1981

that really doenst make any sense because after your 36month lease is up, u just need to come up with another 1+grand for your next lease...and that will total out to the full sales tax you would have paid at the point of purchase regardless

....leasing does have its benefits, not denying that or tryin to argue!

Tripp11

Neither am I...I'm trying to figure out how you pay for the sales tax on your lease buyout purchase...not the sales tax you incur while actually leasing the vehicle.

You say you never have to worry about going over the mileage because you always sell your car outright to a private third party, right? Well, you being the leaseholder must first buy the car from Acura/Honda and technically you're supposed to pay sales tax on that purchase. For example, here in Indiana, we're required to take our title and transfer it into our name at the Indiana BMV - when doing so, they require us to pay 6% sales tax on the purchase price. Then you turn around and sell it to a third party who then also pays sales tax.

You say you sell the vehicle for $1,500-2,000 PRIVATELY above the residual amount but that "profit" would be eaten up pretty quick with 5-6% sales tax hit.

I'm just trying to figure out if you do or do not pay sales tax when you buy the car from Acura/Honda and then turn around and sell it to a third party who then will also pay sales tax. The only way, legally, around this is to have a dealer facilitate the transfer...or at least that's my understanding.

waltaz

Still comes out better, plus, get a new car in 2-3 years.

mau108

Unless your a business owner, I think leasing is a big waste of mulah and mileage restriction sucks too plus its not technically your car.

MMike1981

u get a new car...which is nice, except when will your payments end....? also, lease residuals are almost always higher than the actual value of the car...so even if u did want to buy your car that you just rented for 2-3 years, ur gonna get screwed on the back end and end up paying more than the car is worth...., so what do you do? come up with another grand or 2, justify it by saying well at least i got a new car. better is debatable.

a lease is a constant toilet flush on the wallet. it just never stops. its nice to have a new car, yea, but its not better when ur comign up with cash n fees upfront every 2-3 years. the downside is, after your 2 leases, and not owning a thing, most people will already be done paying for their car for a year (given an avg 5yr loan). it really doesnt equal out. but like i said, its what fits someones situation.

ThePlainsman

Exactly! Leasing doesn't make sense otherwise. And why trade in a car after 2-3 years when it has a four year warranty?

Type34

Guys, as I mentioned, let's not turn this into a lease versus buy debate.

There's a lot of misinformation flying around here...I was an Economics grad and have my MBA, my wife and I have been collectively leasing vehicles for about 13 years now (have also purchased several vehicles), and I'm pretty much a tight-ass when it comes to money , so if you want to have an educated discussion, PM me or email me and I can share my experiences with you (pros/cons).

To answer your question Tripp...
If you buy the vehicle at the end of the lease, then yes, you purchase it as if it were a used car and you pay use tax on the residual at that time. Without going into detail (and thus promoting more lease versus buy debate from others on this board), I'll just say that rarely do I recommend buying the vehicle at the end of the lease unless you have immediate payment ready and will be keeping it for many years.

Acura604

...i've been doing the same thing as Type34... and am enjoying my 6th brand new Acura.. what's next? who knows.. but i'll see what's available in 2-3yrs.

VeNeNo

iTrader: (1)

Around the same time I leased my 07 RDX tech, my uncle leased a 07' FX 35 tech (or whatever they call the top model). the sticker on his FX was about 46K or so while mine was 38K on the RDX. He pays about $450/24 months, while I pay a little under $490/36 months. So my question is, how can Infiniti give away a car that costs at least 6K more for a cheaper price? Is the product not as good as Acuras; do they want them in 2 years to get a better resale value vs. the 3 year lease? Interesting, no?

Type34

As a follow-up to my last post (I didn't catch it in 5 min to edit), I see where the confusion is Tripp...you're wondering how I sell a car that isn't mine to begin with, correct? The assumption you're making is that I have to buy it to sell it...

With a lease, when you sell it, you have the buyer pay off the crediting agency who actually owns the vehicle. For example, with my last sale, I sat down with the buyer at his credit union. His credit union purchased my TL by issuing two checks: one for the residual amount to Honda Financial and one to me for the difference in my sale price minus the residual amount. As the leaser, you have the right to sell the car at any time during the 36-months as long as the leasee is awarded the residual amount of the vehicle.

Hope that makes more sense...

waltaz

Bingo...very interesting. I had no idea. Doesn't that tend to make prospective buyers nervous, when you walk them through that process?

waltaz

My take is that they are subsidizing the leases on those vehicles by increasing the residual percentages and lowering the money factors. For example, look at the residuals and money factors in my example at the top of the thread.

I think Infiniti wants to put people in their cars, then have them lease another Infiniti in two years.

Tripp11

To my knowledge and from all of the verbiage on my Acura/Honda documentation, they will only sell the car to the leaseholder (i.e you) and when you get the paperwork (i.e. title) the title still has American Honda Finance Corp listed as the owner and then you're listed as the purchaser. So in order to sell that vehicle to a third party, the title must be in your name so you have to personally go into your state's BMV and have the titlework changed. In doing so, you're subjected to state sales tax on that transaction. Once you've changed the titlework to indicate you as the owner of the vehicle, you can then sell the vehicle to another party who would have to go through the same process and pay sales tax again.

I'm not playing sales tax police here...I'm just trying to figure out how you avoid paying sales tax to your state on your purchase of the vehicle.

I too have leased vehicles all of my life, and the only way I've ever come across to not paying sales tax is to have a dealer facilitate the transaction for you.

MMike1981

yea infiniti is completely over inflating the resid amt of the vehicle. kinda makes it a really stupid desicion to buy a car coming off their lease. they are just hooking you into leasing. not sure i like it, but you are getting quite an initial deal i guess off the bat, but again, just not owning anything, but if u lease all the time that wouldnt matter........it would be crazy to try and sell that car off the lease holding close to a 65% resid @36k miles....so for someone like type (who seems to be a good salesman if what he says is true) thatd be a very tough situation