I'm looking to lease a 2006 (either 36 or 48 months). My question is this:

If I could get a dealer to agree to a price of say $500 over invoice + destination on a 2006 TSX now, would it be stupid to put down a deposit now to secure one of the first 2006's? My current lease is up on December 4, so I need to make sure I get one of the first 2006's if they're not coming in until the end of November, which is what I'm being told.

Basically, if we agree on the purchase price now, is there anything else they can screw me on once the car comes in and they work up the actual lease numbers? Won't they just work the numbers up based on the current residuals and money factor published by American Honda Finance or is there some way I could end up getting screwed by the dealer?

Thanks!!

 

Would it be stupid to do so? Don't think so, its one of the only ways you can ensure yourself on getting one of the first. Today I did just that. Put $1000 down on an '06 CG 6MT w/ Navi for $900 over invoice + destination. We didn't talk about how the car would be purchased at all, this will be done once the car comes in. He told me that this coming Monday (the 19th), their dealership is putting in there order for the '06's that will arrive in December/January. Glad I didn't miss that date because they won't do it again until the following month.

 

about the only good advise i can give you is to make sure you lease through AHF. ive gone with banks before and they have a tendancy to take only interest payments on the front end of the lease. 1/2 way through the lease you will have paid only a couple grand towards the principal.
i usually never keep my leased car the whole term. i find usually about 3/4 way through especially with an acura you will already be ahead and can trade the car in without oweing any money. you still have another option of selling to a private party which is about the smartest thing a person can do, though i never have the time to do that or the patience to sell it. the only downside is you have to pay the taxes due when you pay off the car.

i seriously doubt your going to talk any dealer into 500 over invoice. i have some really really tight hookups at the local acura dealer and i was able to get about 500 over invoice for a friend of mine on a 05 6 speed non nav but unless you have someone at a dealer to hook you up i doubt you can get one that cheap. usually they have a 1k markup over invoice at most dealers on new arrivals. why would they sell you one that cheap when they already have a line of people out the door waiting to get their hands on one who will pay full sticker.

 

But basically, once I negotiate the purchase price, the rest shouldn't matter, right? I mean, the purchase price should be the only real variable, correct? Then once the car comes in, I just take whatever residual and money factor American Honda Finance are using at the time. Is this right?

 

The dealer does not have to give you the best possible interest rate. Who are you leasing your current car from? Honda lets you keep the car up to an additional 24 monthes after the lease ends. I am in a similar situation. My lease is up Nov1 on my accord, I am trying to decide weather to get an 05, try and work a deal on an 06 or hold off until the week between christmas and new years and make an offer for something that is on the lot.

 

My current lease is through AHFC, so I do have the option of keeping my car longer if need be, but I'd rather not, as my car will be out of warranty come December when I hit 4 years.

So why would the dealer not give me the best interest rate that I can qualify for? Once they've made their money on the price of the car, how would they possibly benefit from charging me a higher rate?

 

I have a question...its really dumb.

like really.


Whats over invoice mean??

500 over invoice does that mean 500 over what the dealer asks for it? If so why would someone agree to that?

You should only pay less then the advertised price.

 

Jkozlow3, yes you can negotiate a better price and that would be the only variable. honda will have a fixed interest rate on their lease based upon your credit.
negotiating 1000 in purchase price on a lease = about 20 a month lower payments.
also. i just noticed you live in colorado springs. we have the same dealer. the very same dealer that i have a couple good contacts at. if you want to negotiate a better price on a lease you should contact me and have me refer you to one of my contacts over there. pertty much whenever i go into their dealership with a friend they give my friends the royalty treatment. ive bought several cars from that dealer as well as sent countless people to their dealership. usually there is very little if any negotiation on price. the last friend i took there as i said we got him a TSX for their cost (invoice) + about 500 bucks. he was driving the car home 45 minutes later.
send me a PM and ill get you my contact info if your interested. also we have the lowest rates of insurance in the whole city there is a good chance we can save you some money in that department to help offset the cost of the new purchase.

Powered by honda, yes we are talking the price the dealer pays for the car. they also get about 3% hold back fee which is money the manufacturer gives the dealer to store the car on their lot untill it sells.
so even if they sell the car at wholesale they still get 3% + their dealer prep fees and PDI fees which is usually another 400 bucks at most dealers.
i belive where they make the most money is on trade ins. they never give you what the car is worth and always sell your used car for a lot more than its worth.

 

Here's how you can get screwed (I've leased my last 6 cars)...

The residual is set by the bank, usually monthly. So you are set there.

However, the money factor (interest rate) can be tinkered with by the dealer. So they can sell the bank the car for $500 over invoice and then cry poverty to you, but if they jack up the money factor/interest rate, you get screwed and they make back the money.

It's good that you locked in a selling price on the car.

Whatever month the car comes in, call around to multiple Honda and Acura dealers (since you will likely lease from Honda), and ask what the money factor is. Then make sure the dealer you are working with is using the same/comparable money factor.

Good luck with the car. It's fun to drive.

 

I see. How would you bargin for that. Just tell them I want to pay invoice? *which by my understandings is less then the advertised price in the papers*

 

exactly, and the best way to bargin a price is to use 2 dealers against each other. dont be a jerk about it though and go back and forth and back and forth negotiating prices. call the closest dealer first and negotiate a price. then call a second farther away and tell them they have to give you a better deal than what you were offered to justify the drive. then call the first back and see if they can match it. then honor this deal by going to the dealer and putting a down payment.

like the other poster said make sure you are getting the same money factor, they all use the same calculator so ask what the payment would be monthly including taxes.
but whatever you do when buying any car is never, never, never tell them how much money you can afford to pay monthly. doing so allows the dealer to sell you a car with a higher interest rate and they make their money by selling the loan to a bank and keeping the extra cash.
always work the sale from the price of the car and then when the monthly payment amount is given see if it makes sense. a 27,000 lease through AHF should be around 360-370 a month. this would be with no money down and no trade in. keep in mind every 1000 additional financed will raise your payment another 18-20 a month.
if these numbers dont jive or are close within say 10 dollars a month you should question the money factor or the residule. they could be selling you a low residule lease.
one of the biggest mistakes people make is to go to a dealer and say "i can afford up to 500 a month" and then they will be happy to sell you a car for that. what they dont tell you is you just paid them about 6000 extra to go party with and you end up making payments to support it.

whenever you negotiate a car sale always work the purchase price of the car you intend to buy first, then negotiate the trade in value of your car. then negotiate the monthly payment.
the reason is that doing it this way will prevent them from playing the funny money game with the numbers. often times what they say they gave you for your car they actually added a few grand to the purchase price of your old car. in otherwords they rolled the negitive equity into the new car. and now your making higher payments to pay off the car you just traded in.
this is more common when buying crappy american cars like fords because there is a much bigger markup on them. for example a dealer can sell you 2005 ford tarus at sticker and you think your getting a great deal. however they have close to 5000 in profit on sticker not to mention manufacturer cash back incentives. they can take someone who is 6,000 upside down on their old car and roll all 6000 into the price of a new car and still come close to sticker while meeting your monthly payment requirement. what they dont tell you is that as soon as you drive that tarus home nobody would give you any more than 15,000 for your new 20,000 car.
this exact same thing happend to one of my clients and unfortunatly she is stuck with the tarus for at least 5 years with an inflated payment on a car that she will have paid enough to buy almost 2 of them new by the time you add up all the payments and interest.