jcl_cls01

Can I break my current CL lease with American Honda Finance Co to get another Acura? I'm looking to get the MDX or TLS since I have a new baby and getting in and out of the 2 door is a hassle with a baby seat.

CLSter

I hope you have the lease agreement because you need to see what the penalties are. It will be listed.

Beltfed

Sure you can, its only going to cost you money.......how much I have no idea.

neoprufrok

I've been trying to do this for awhile now, but at this point, it will cost me at least 4,000 dollars - the difference between the payoff amount and the current market value of the car. I own a 03 CLS MT ABP by the way.

I was trying either to trade for an Audi A4 or an Acura TSX (I like four doors better), but after realizing the cost, decided I'll just bite the bullet for now and love my CL for another 2 years!

Bulldog01

Yup. It'll cost you the remaining payments, plus any damage or mileage charges. Aaahhhh, the downside of "lower" payments...lost flexibility. It's a painful, expensive lesson I'm learning every month.

fuzzy02CLS

iTrader: (2)

Yes you can. There are no fee's, no penalities, you do not have to pay the remaing payments. Yes that is stated in the contract, but if you are getting another Acura, You are simply trading in the car on a new lease. You will have to pay a big chunk of $$ though. Like neoprufrok said it will be the difference of your buyout on the car, & what the trade is worth. Plus any new lease fee's, down payments etc. Another way they can do it is roll over the difference into a new monthy lease payment on the new car. So if you owed $4K & your new lease is for 39 months, then an extra $102/month can be added to your lease payment. If your new lease is $400/month the new price would be $502/month.

Starter

Just some of the many, many reasons to NEVER EVER lease a car.

Beltfed

Wrong, leasing is a great thing if you know what you're doing.

What it comes down to is that people lease cars for 36 months and decide after 30 months they want a new car. Well with leases, its not that simple....the banks want their money.

So if you're the type that knows they won't be able to handle a 36-39 month term.......don't sign up for that long then. Either take a shorter lease or buy the car, simple as that.

Even with a finance, if you bounce out of a 48 month finance after 2 years in most cases you are going to lose money (just like breaking a lease). Especially with the way the used car market has been, resale values aren't going to get any better anytime soon.

Cars are a money pit, doesn't matter how you cut it. If you pay cash, finance, lease, etc it really doesn't matter.

Smitty02CLs

You can try to find someone that will assume the current lease from you, I believe AHFC started to allow this last year. I'm not 100% on the details..... does anyone have any info?

soopa

if your getting another Acura through AHFC your dealer might be able to work something out for you...

They have once for me.

clscls6s

Oh, yeah - and if you'd bought the car up-front, you'd be in so much better shape financially. Sarcasm intended.

People who use the "lost flexibility" rationale neglect the simple fact that if people bought cars instead of leasing them, they'd be in a similar predicament. With the poor resale value on the CLs right now, if you tried to get out of a purchase 12 months in, you'd probably be $3000-$4000 upside down. Most of the stats show that people don't have positive equity in their vehicles until 39 months in on a 60 month contract. So, buying isn't any better than leasing, all other factors being equal (which they're not - purchases usually have higher payments, plus in most states, you're responsible for sales tax up-front on the full purchase price vs. taxes on just the payments and any down payment on a lease).

jcl_cls01 - to answer your question - yes, you can early terminate the lease. You're usually responsible for the difference between current market value and what you owe, plus (possibly) an early termination fee. (Just like if you had purchased the car - you'd be responsible for the difference between what the dealer will give you on trade for the car and what the payoff is.) Check your lease contract for exact details or call AHFC.

However, since you're looking at a new vehicle anyway, you can just trade the thing in - find out what you owe AHFC, then negotiate the best trade and deal you can on the new vehicle. It's just like trading in a purchased vehicle. The dealer will pay off the lease - if you owe more than it's worth, the difference can usually be rolled over into the new lease/purchase, just like negative equity in a purchased vehicle.

clscls6s

1) Nowhere in an AHFC lease contract does it say you can early term a lease with no fees or penalites. I hope you're being sarcastic and aren't seriously providing this as advice.

2) Your formula for calculating the new lease neglects lease charges (the lease equivalent of interest). If you roll $4k into a new lease, your new payments will go up more than $102/month ($4,000/39) - more like $112/month more on the MDX.

If you want an example of this, go to the lease calculator on www.acura.com and calculate a lease with $4,000 down and one with $0 down. The difference would be much more significant if Honda's lease rates weren't so low right now.

Black CL-S 4-Life

Getting out of the lease is easy just report your car stolen and drive it into the nearest lake.J/K:P

mullet

I'm kind of new to this site and a new CLs owner, but I've been selling Honda's for a few years. So maybe I can help a little.

Let me start off by saying I leased my Acura, as a matter of fact everyone I know in the car business leases their car or pays demo fees and drive one of the dealers. We don't buy cars. Why, because buying a car is the one of the worst financial decisions one can make.

Business 101- Buy what appreciates, lease what depreciates.

I have friends who sell cars at a Mercedes/Porshe/Audi dealer here in DC. Guess what, 95% of their clients lease. Know why? Rich people and their accountants know how to handle money.
Usually the only people who knock leasing are the ones who don't qualify, as it takes very good credit to lease.

When you lease a car you have 4 ways out.

1. Wait until the term is up and turn it in and walk away. (Try to never do this, unless you have to.)

2. Buy the car at the end of the term for the remaining payoff and keep it.(Never ever do this, you can always buy one on the used car market for less as residual values are always inflated to make leases more attractive)

3. Trade the car in and recieve whatever the market bears, and roll over the +/- equity into a new buy or lease.

4. Sell the car on your own, and send the leasing company the payoff, you keep or pay the difference from payoff.

And the best thing, there are no penalty's from AHFC for turning in early provided they payoff is met and the damages aren't severe (typical wear is overlooked), and you aren't over mileage.

Here's a couple of tips--

First thing, any Acura/Honda dealer will jump through their ass to get you out of your lease . It's a welcomed opportunity for them to make money, so getting them to go to work and sell you a new car won't be too hard.

If you do have negative equity (your payoff is more than market value) try to find a car that is selling for well below MSRP and trade-in for that one. That will give you more room for hiding the money you are rolling over. And lower payments!

In my area, MDX's are MSRP +, so that wouldn't make a good lease candidate if you have negative equity.

TL's generally go for around invoice so that should be a great one to hide some -equity.

I've hidden thousand$$$ in new 03 Accord EX-V6 leases. Just a few thoughts. Sorry for writing a book.

clscls6s

Excellent point. When we leased the CL, we had narrowed our choices down to the '03 CL-S six-speed and the Infiniti G35 Coupe six-speed.

At the time, G35's were selling at MSRP, making the lease payments very unattractive, around $600/month.

We received an offer of $200 over invoice on the CL - making our payments under $400/month, including tax, with nothing down.

Suddenly, the decision became a no-brainer. $200+/month difference, no money down, same lease length, same mileage, etc.

mullet

Those G35's are hot!

Part of the reason the G35 was more per month on a lease was the selling price. But, I'd be willing to bet the main reason was the horrible resale value (residual) Infiniti suffers from. Hopefully, for Infiniti, these new models they are making will remedy this situation.

Infiniti is by far the worst (resale wise, not quality) of any luxury brand besides el crapo Lincolns and Cadillacs, of course.

On a side note. It's actually cheaper to buy a Cadillac/Lincoln with 0% than to lease one due to their massive depreciation/horrible residuals.

Bulldog01

I am well aware that a car depreciates like a motherf*cker, and you're kinda porked no matter what. My point is/was that once one signs a lease, he is generally on the hook for the entire term of payments. I also realize that financing a car will leave one in a similar predicament if he wants to get a different car. And, I realize that lease payments are generally lower than finance payments. However, I have put a TON of miles on my car, due to a divorce an' all, so I am learning an extra painful lesson every day. However, I love my car, so I'm glad I haven't "been able" to get rid of it.

It all comes down to the fact that a car will depreciate. Whether one "pays" for the depreciation in mileage charges or finance charges, he's gonna pay.

KCPreki11

Explain again how you can hide money when turning in your lease and buying a car below MSRP?

URIRx98

U can get out, but its deffinately goin to cost u. I got out of my cl-s, but it cost me when my car went back. Aparntly i was told i didnt pay the remaining 4 payments of my car, aproximatly 2grand, but it may have been rolled into my payments. I dont think that actually happened, because my payments are almost 600. i am prety sure its a good price cause my buddy did a lease for 4 years on a non navi touring mdx for 540 and mine was 585 before i added window etch and maintence for the life of it. So it can be done, car can be traded in towards another, but it depends on how many months are left. If its a lot , then you will be payin alot. O and by the way, make sure u get the car inspected before u give it in, cause i am in the process of gettin screwd in the asssssssssssssss for 1200 bucks over 2 tires (530)and 4 dents(240) and mufflers (500)/ they opted to let me off for 821, im pissed, so make sure you are careful.
wg

Starter

He's blowing smoke. All that does is defer the eventual day that puppy comes home and poops on the floor. And all the while paying interest through the nose for the priviledge.

All cars depreciate (ours more than some). Your only hope is to get equity in the car. Early on in your financial life you almost have to finance (not lease). Pay that off as soon as you can - that means early. Bank the payment you would have made after you pay the car off. Next car apply the banked money to your down payment and pay off early again. A few cars down the road and you can pay cash for your new car. Stop paying interest, often a very high rates. The only excuse for leasing is if you have a tax situation where you can write off part or all of the lease payment.

Everyone who has a lease has been sold a bill of goods to get the "low payment". Ain't so - you pay much more in the long run. The bottom line is, if you have to have the lease low payment to get what you want, you CAN'T AFFORD THAT CAR. Have a little self discipline, buy a lesser car, and in a few years you can have anything you want and for one hell of a lot less money.

gto2050

I lease all my cars. But....you have to know what you are doing. You must be prepared to see the car through to the end. Next time do a shorter lease.

As for the G35.... it too is leased and at a MUCH lower payment than the CL was. I have leased 9 cars in a row. And I might say I am very happy. As an old friend once said...."If it rolls, flys, or floats, lease it."

Bluto

If you can get a return on investment higher than a loan rate, why not invest the cash and borrow money for a car? Put cash in something that appreciates. Depending on the rates and market, 1/2 cash, 1/2 finance is a safe option. Also, buy a used car that already depreciated.

I've never considered leasing because of mileage. Maybe next time around...

fuzzy02CLS

iTrader: (2)

Just because it's not in the contract doesn't mean there are not ways of getting out without fee's. I have done this. Traded my leased 02 for the 03 6 speed. Lease contracts are like any other legal contract, there are always ways around them that's not stated in the contract. As everyone said it will cost $$. I paid almost $6K to get out & in the new car. Not because I didn't want the lease, or wanted to get out of it, I just wanted the 6 speed.

clscls6s

Ah, there's the key. If you put a ton of miles on your cars, there usually isn't any point in trying to lease them, unless the payments are so much lower that you could make up the excess mileage charges. Or you plan on trading it in before lease term.

If the car has great resale value, there's sometimes a way out. My mom leased an Accord thinking she'd be ok mileage-wise. She changed jobs and starting driving tons of miles. She had 80,000 miles by lease term (36 months), so instead of turning the car in and taking the excess mileage hit (something like $6,000), she traded the car in on an '03 Accord. The dealer gave her a pretty damn good deal on the trade (she basically got what she owed), gave her a discount on the new car, so she avoided the excess mileage charges and got into the new Accord (another lease - she isn't driving as much now) under $300/month with nothing down. Pretty disgusting, if you ask me!

Your mileage, ahem, may vary. This is a pretty isolated incident - she got lucky in that her timing was perfect (the dealer was desperate to sell cars) and that her Accord did ok resale-wise. Otherwise, she'd just have to buy it at lease term and take her chances selling it herself (or keep it).

mullet

Sorry for the delay, I've been busy.

The question was how do you hide negative equity from your trade into a new car?

You need to find a car that can be bought below MSRP, because
the bank will generally loan 100-110% of the MSRP on most new cars.

Example.....If $25,000 is the MSRP, the bank might loan 110% or $27,500. But if you're able to buy the car at $22,500, then that gives you a $5,000 difference between actual selling price and the and the actual loan amount.

What the bank won't see is that some of that money ($27,500) is actually coming from negative equity ($5,000) from a trade-in because they don't look that deep in a deal. They will just think you're paying MSRP for the car plus a few adds such as taxes, tags, accesories, etc...

As for blowing smoke, I never said it was ideal, I just said it was possible to get someone out of a neg equity situation. Sure the payments will be lower if you don't roll in neg equity, but it's the only way out if you don't have the cash to pay upfront.

The good thing about rolling negative equity into a lease is, the payments aren't affected as much as a straight purchase would be. Because alot of your negative equity gets residualized and you only pay for a portion of it, rather than coughing up the whole chunk at once.

I hope this answers your question and makes this your car buying experience a little easier.

Regards

chef chris

Beltfed(as usual) & Mullet are correct.

Mullet...P.S.Most banks know when someone's buried...but if they're a good risk, it's not such a big deal. But then again, you probably already knew that I have the pleasure of dealing with Finance Managers all day long...

Welcome aboard...nice to have another resident auto/finance guru. Get your soapbox ready.

Starter

All this assumes that you want to be in financial bondage to a bank or loan company for the rest of your life. You pay interest on every dime that is financed and that includes lease payments -- part of the payment is interest. Let me point out that if you can purchase a vehicle for $5 grand less than MSRP, so can everybody else and that will be reflected in the resale value. Your're going to be even deeper into the pit at the end of this lease than you were before.

You and most car salespeople are only trying to find (very) short term solutions for people who just have to "have it now" no matter what. This works well for the people who don't have the brains or maturity (or both) to think past "can I make the payment this month". And you make a nice chunk by change on putting them in the hole. This deal is NOT in their best interest.

chef chris

Starter,

There are circumstances when you NEED to lease, end of story. In those cases, it can be benificial. Now, I don't think anyone here is saying that it's the only way to go for everyone. If you want to keep a POS til it falls apart, then buy it. If you want more of a newer car for less money, more often, lease it.

And P.S.- These days, the money-factor(interest rate) on leases is usually very low. I have under 3% on my 02 Acura lease. Right now, the money factor is next to 0% for the 03 Cl...

n00dleboy

Here's a situation for you folks.. my CL-S cost about 36G (canadian) + taxes, and i had a trade in value of about 10,000 so the actual left over of the car was about 26,000+ taxes and i'm leasing the difference. My monthly payment is $414 / month. Now lets say i want to get out of the deal what kind of penalties would i be looking at? What about the 10,000 down in trade in what happens to that? Or if say i wanted to just simply trade in for a cheaper car like say $25,000 msrp, how would that work?
thanks gurus