One of the things that distinguishes buying an auto from buying pretty much everything else out there is the widespread ability to haggle over the price.

That having been said, what do you pay for your monthly lease? This can be an important thread for buyers in different regions to see where they can get the best deal, for the TL-S or any other type of Acura.

So.........I'll begin. I have black on black no Navi 2002 TL-S and pay $435/mo, 36 months 36000 miles, a dime a mile over 36k.
$1000 down took care of first month, last month and tags/tax/freight.

I thought this was the best deal out there. Anyone do better?

 

TL-S with Navi. $530.00 per month including tax, 12K per year, 30 month term, just security deposit and dealer charges at drive-off.

 

Just leased one the other day, got an okay deal. 39 months at $440 with $2500 (including first month, tax, tag, title, etc.) for a TL-S w/o navi. I had over $4000 in negative equity from my trade in, so all things considered, it was actually a really good deal. I negotiated the price of the car to below invoice (dealer was trying to break an annual sales record and made a mistake).

 

I think it was $3K to drive it off the lot, $390 per month (INCLUDING Wa. state tax), 12 k miles/yr, but it for 4 years.
I forget what the price of it at the end of the term was agreed on. Does anyone else remember that, too?

 

5k Down, 311 mth. 15K 3 -years

 

As posted yesterday in another thread, TLS non-navi, $700 total out of pocket, 48 month lease @ 398 a month + tax

 

OMG!!! leases are pretty damn expensive. why dont you guys just buy the car?

 

I pay about $470 For non-nav. I payed $0 down for 48 months

 

I think that the lease really only makes sense if you have it for 3 years or less and if you fight for a low monthly payment AND upfront fee .

Figure that your lease runs you average 420 a month and you put down 2000 bucks. **Just a rough estimate**
If the lease was for 4 years then you ended up paying 22,160 when you could have owned the damn thing for another 6 thou.

I shopped around and found a great place to lease- with my deal (posted above) I end up paying $15,790 and and can walk away from the car after the three years, no problem. I like that because after three years.... it's just time for a new car!

But it goes to show you that you have to shop around- the first place I went, Curry Acura, wanted almost 500 a month and 4,000 down, which was completely absurd. I ended up getting my car through a broker, which is always cheaper... you just don't get the dealership relationship that alot of people love.

 

You live in Vancouver...so is the $470 in Canadian money?

 

He lives in Vancouver, Wa, USA.
"y2ks2k
Gold
Registered: Oct 2001
Location: Vancouver, Wa
Posts: 133"

Not sure if the $470 includes tax, though.

 

No, you forgot interest. A $28,000 car will cost you $32,000 after 4 years at an interest rate of 6.9%, which is $10k more than your lease payments.

If you have the money, you should purchase a car and later resell it if you decide to switch. A lease doesn't build equity, and you'll always have a nagging feeling in the back of your mind if you want to mod the car or put some miles on it.

 

I may be new at this, but doesn't the lease price include the interest in it? Therefore you know at the start of the lease just how much your out of pocket expense will be, and it doesn't matter how much the interest rate is... doesn't that make sense?

 

Black TLS with Parchment interior, no Nav. $1000 down for 48 months.
$400 including tax.

Leasing is the only way to go if you don't want the car longer than four years.

Myers

 

$430 a month
drive off was: 1st month payment, secuirty, tax, registration, all about $1600
Tl-S non-navi
spoiler included

 

oops 48 month lease
hehe

 

You're right; what I meant was the purchase price that you computed did not take into account the interest.

Per your example:

Lease: $2000 down, $420/mo., 48 mo. = $22,160.

Purchase: $28,000 principal, 6.9% APR, 48 mo. = $32,044 ($668/mo.).

 

Laurelcrest,
Lease: $2000 down, $420/mo., 48 mo. = $22,160.
How do you feel at the end of 48 months when you turn in your TL? You'd just burned $22K with no equity.

Why lease? Buy your car.

 

Thats right. I used that hypothetical to illustrate when it would not be smart to lease. On the other hand, my lease is for 36 months @435 a month = $15,660. If I bought the car, and wanted to get a new one after 3 years (which I inevitably will) I would have to sell it. Since a new non-Navi TL-S like my own would cost roughly $32K (because of interest/finance charges over the course of my ownership) I would have to sell the car for $16,340 to come out even ($16,340 + $15,660 =$32K)
and I'd rather not have to sell the car...would you buy a used TL-S after three years and, say, 40,000 miles for close to $17,000? I wouldn't!

 

2002 TL-S non-navi
$427 mo. (tax incl.) x 48 months with $1000 due at signing.

Why lease instead of buy?...cause the monthly payments would be AT LEAST $130-150 more on a 60 month loan with the same amount down. Plus, I'm ready for a new car after 3-4 years anyway.

 

I have a 48 months 15,000 miles per year lease. I pay $414.00 per month including tax. I put 0 out of pocket. I traded in a 01 CLP I leased 5 months before. The dealer gave me what I paid for it, so the difference went for the drive off costs.

 

This is some info on my lease deal through Honda Motor Finance Corp. which I posted to the board some time ago:

The sales price for my deal was $29,521 (includes $480 destination charge), no dealer installed accessories. The money factor for a 36-month lease was .00225. The 12/01 residual value was 61%.

Based on the above, my monthly payment is $351.91. This is with $2K cap cost reduction, plus acquisition fee, security deposit, and DMV.

Typically, the total cost of a leased car (i.e. sum of all payments, fees and cap cost reduction) is lower with a shorter term (given the same cap cost reduction and fees). A longer term (i.e. 39, 42, 48 months) may result in a lower monthly payment but increases the amount of interest paid. Thus the overall cost (over the term of the contract) is more. This is a function of the present value of money.

In order to determine the optimal mix of cap cost reduction and monthly payment (for my situation), I created a spreadsheet that allowed me to create different scenarios to determine the lowest total cost at the end of the contract. I.e. my total "out of pocket" cost.

If anyone is interested, I can post this spreadsheet and you can try it for yourself.

 

Skeptic: I am stunned. Your figures are about $80 a month lower than the lowest lease rate posted yet!

If you could be so kind as to post your spread sheet, or a link to it, I would really appreciate it.

As well, don't assume that the average consumer will understand "The money factor for a 36-month lease was .00225. The 12/01 residual value was 61%."... or "cap cost reduction".

If you could explain that in a comprehensive manner then it would appear we would all be able to benefit next time we shop for a car!!

Thanks

 

first of all 3 years is not a magic number. TL's warranty is 4 years, so a 4-year lease is more appropriate.


My lease is 4 years, 15K miles per year. TL-S non NAV.
$1,500 down includes all fees and first month payment.
$395 per month + tax =$418 with change.

I am in a leasing vicious circle
- 96 supercharged Buick Riviera
- 98 Pontiac Grand Prix
- 2001 Lexus RX300
- 2002 Acura TL-S

so far I have no complaints

 

I think you nailed it right there, jkozlow3.

If you're the type who simply has to buy a new car every 3-4 years, then by all means lease the car. It makes no sense to buy the car only to struggle to resell it again. Pay just the depreciation by getting a lease and keep the rest of your money in a savings account.

But if you're intending to keep your car for 5 years or more, then a purchase may be more your thing. Remember, once you've paid off your car you'll have no more car payments, and you'd have built equity.

A purchase is almost always more desirable if you have the money. You can always sell your car and recover its residual value at any time, and mileage and modifications are yours to decide. And of course you can always not sell your car and hang on to it. Whatever you decide, you'd have equity in that car.

 

TLS with Navi, $1000 down, 48 months, $406 per month. Leasing is great for me because I write off the payment (outside saleman), very little money down, I can walk from the lease after about 30 months without it costing me to do so. Two reasons I might get out of the lease early...mileage gets too high or I get tired of the car before the lease expires.

Those of you who are wondering: Its pretty easy to get out of a lease like mine on the early side if I choose to a) because I got a great deal and b) because this car is likely to hold its value very well.

If I want to buy the car at the end of 48 months (like if my wife wants to keep the car, which may very well happen), the residual is like $18,000.

 

Dave R. and tea elle have it down. Writing it off is an advantage. Heck, if you have a small home business you can write some of it off... monthly payment, mileage, gas, and insurance (in some states).
Myself, I see me being in different shape financialy in 3 years, so... I'll be ready for a different car, and with the lease, I can put the difference (between financing an leasing) into a mutal fund and have quite a bit more than I would of if I financed (or maybe put towards a house, or buy stocks [in Walmart?]). If you want to argue why not finance instead of leasing, why not just buy it with cash? Yeah, that's what I thought.

 

My payment is $366.00 a month that includes the tax 5% in MASS.
Only dropped $500.00 out of my pocket.

 

I have my car for about 6 weeks now.

Upfront I paid the security, first month & bank fee. I did not have a cap cost reduction.

The lease is for 42 months with 15,000 miles annually. The payment before tax would have been about $410 and with the tax is $451. They added $2.00 a month for the gold badging on the vehicle. I think the residual was about 57% and the money factor converted to about 5.7 %. I used to know the numbers backwards and forwards.

I used a lease calculator program on my Palm Pilot to keep the dealer honest.

 

What every car salesman wants to hear is someone who says "I can afford X dollars per month". They know that these individuals do not look at the cost of ownership and expect to ALWAYS have a monthly payment. I buy my vehicles on a 36 or 48 month note, keep them for another 24-36 months with NO payment and sell or trade the car for a wad of cash. I pay less per mile than those who lease.

rw

 

Sklongis,

Everone should follow you're lead, I did the same as you did and my numbers magically came out $12 less than the dealers did, when he finally gave me all of the info. He then admitted that He "made a mistake" and my number was the one that we went with.

Everyone should know what the rate factor and residual are, these numbers are critical to knowing if the deal is good or sour , and mean much more than simply stating what you're term and monthly payment are. If you do not know what these numbers mean then the dealer has the upper hand, and you most likely paid more than you should have.

 

Roadman,

I can't agree with you more, nor can I overstate the value of having a lease program on your PC or handheld device. I would sit and plug in the numbers as the sales guy spoke. The program would convert money factor into interest which is important to understand. You could factor in cap cost reductions as well.

I would work up different scenarios at home before I went back in to see what could I realistically expect and what would be the net result in my monthly payment if they lowered the sales price of the car by $500.

While it is possible to shop the car at competing dealers, you have to consider the value of a local dealership (if they are good) as compared to $300 off the price of the car which in a 57% residual might really mean only a $171 reduction spread over a 42 month lease plus interest.

Steve

 

Tax deductions and length of ownership are the key considerations. You can write off your entire monthly lease payment, but if you purchase, you can only write off a set amount (approximately 2,000-3,500 per year) for only a few years (check with your tax accountant). Thus, your write off on a BMW or Benz (or even Acura) lease would be a better deduction than on a purchase.

Also, because you take such a depreciation hit once you drive the car off the lot, the equity build up you get purchasing your car is only worth it if you keep your car for at least 5 years and your car maintains its value.

The third factor is that leases allow you to drive much cooler cars than you can afford to buy.

 

Your first two points are nonsense. Fixed assets in a business can be depreciated until the basis reaches zero. Translation - the only limit on the deduction is the value of the car. The IRS guidelines are around five years on a vehicle. My dad has depreciated the Lincolns and Cadillacs in his company for over twenty years. He bought them cash outright.

Equity is the difference between the value of an asset and what you owe on that asset. Your comment assumes someone is buying a car on a 60 month note or a piece of junk like a Hyundai. I paid mine off in two years. My equity thus became about $22k. I haven't had a car payment in over a year and will not have one for the next two or three years.

I agree with the third point. You can always rent something cheaper than owning it.

rw

 

Amen to that, Sparky. Me too.

 

I agree. I ended up only putting $4,800 down (my trade). $530/month for 60 months. I always take out a five year note and usually put in extra $$ to pay it off sooner, but I'm not tied down to make the higher payment in a tight month. For example, I took out a five year note on my Vigor, but ended up paying it off in 3 1/2 years.

I then ended up paying it all off with a home equity loan so that I can write off the interest, in addition, with interest rates falling, my rate has dropped almost three points since I bought the car, but I continue making the same payments, so it's like adding additional $$ to principal.

 

The only cars that build equity are collectibles. If you buy a $30K car it begins depreciating the moment you drive it out the door. The "equity" that people who buy are referring to isn't really equity. It's illusionary based on the fact that you may be paying off the car faster than it's depreciating that simply means it's worth more than you owe. At the end of five years, you don't have equity you have a $30K car that's now worth $15K. Leasing makes sense if you trade cars frequently because you're only paying for the amount of the car you use plus interest. Leasing sucks if you don't take care of your cars, drive a lot of miles, or if there's any financial risk that you won't be able to fully complete the lease. I leased a TL-S Navi for $530 per month for 30 months with nothing down (total payments = $15,900 including tax and interest). Acura's going to take a bath when I return the car because the residual value they assigned isn't going to be close to what they'll be able to sell the car for. Sometimes you win - sometimes you lose. While leasing isn't for everyone, it sometimes does have advantages that are worth considering.

 

eq' ui-ty (ek'wi-ti), n.; pl. eq'ui-ties, [M.E. equitee; OFr. equite; L. aequitas (-atis), equality, from aequus. equal. ]

3. the value of property beyond the total amount owed on it.

While I agree all cars depreciate, apparently you have your own definition of the word !

Indeed the equity becomes more significant past about three years. The equivalent cost for my TL-P for 38 months using your calculations is about $13,000. Since I plan to keep the car another two years or so, that will work out to an effective monthly cost of around $350 per month for driving an average of 17k per year. I believe that is a significant enough savings to somehow "slum" it by having a five year old Acura.

rw