Browing the net yesterday I saw my local Infiniti dealer has a lease special on an 06 G35 coupe: (few options and an automatic tranny)

negotiated price: $34500
$4000 down
residual 72%: $24840
$349.00/month for 12 months

I went up to the infiniti yesterday and told them that I wanted a 6-speed with the premium and aero package.

The MSRP on the car I want is $38280. But with a little haggling they knocked the price down to $35730 ($816 over invoice)

They have the following offer on the table
(no trade in)
negotiated price: $35,730 ($1230 more than the "base" model)
$4000 down
$410.00/month for 12 months.

So I would be paying $61/month more for the extra $1230 in price. ($1230/12 months). Something seemed wrong with the offer so I took the numbers home and worked on them. I figured that the $61 extra a month means that I am paying 60% on the extras, when the offer in the paper states that the residual is 72% and that I would be paying 28% on the car.

When I figured out the numbers with 28% on the car AND 28% on the $1230 options:

($1230/12) X 28% = $28.70

$349.00 + $28.70 = 377.70/month

It appears that Infiniti is over charging me $32.30/month for the options; since they are charging me 60% on the options while they are only charging 28% on the actual car. Am I correct?

 

One good method to determine the true lease cost is to divide your down payment by the number of payments and add that in. Therefore you would have to divide the 4000 down payment by 12 add the result (433) to your payment. That changes the deal to me---$782. So you would have paid 9384 w/0 the options for the use of the car for 1 year. As far as the options, your reaasoning sounds correct.

 

A good, quick rule of thumb that I have always been told is that for every thousand dollars in cost you add to the lease, you add $20 to the monthly payment. In your case, you're adding about $1700 dollars to the lease price of the vehicle so your monthly payments should have come out to around $385/month. My guess is that the dealership took the opportunity to up the money factor on the lease as well since that's usually where the low monthly payments on leases come from.

BTW, this lease is totally not worth it if you have to put $4k down. All that up front money is just being thrown out the window.

 

For add-on's like the aero package, the residual value is lower than that of the car. You might want to look into that. Also, the 6-speed might have a lower residual than the automatic.

 

Yeah, I thought about the down payment and $4000 is a bit much to put down.

The salesperson told me that he doesn't suggest I put down $4000 because that pretty much defeats the purpose of a lease. He also did the numbers with $2000 down and $0 down:

current offers:
============================================
/w $4000 down: $410/month: total cost of lease: $8920
/w $2000 down: $597/month: total cost of lease: $9164
/w $0 down: $717/month: total cost of lease: $8604


the lowest cost of lease is with $0 down. the highest is with $2000 down.

I am not exactly sure how it works, but when I lease don't I just pay a percentage of the car? In this case the percentage is 28%. (100% - 72% residual)

The car I want has an MSRP of $38280, and they discounted it down to $35730.

28% of $35,730 is $10,004. all of the lease offers above appear to beat that $10,004 number and definetely beats the numbers if they charged me MSRP for the car. looking at it this way, does it still seem like a bad deal?

 

Seems alot for a lease. Then again, I've never done a one year lease but I can't imagine putting much down.

 

What is a good money factor for someone with a 790 credit score?

 

Remember, the residual is based off of the MSRP, not the sale price. So what you pay for is the difference between the sale price and the residual, which in this case comes to $8168.40. This payment is split over the number of months of the lease with the money factor (which is essentially interest) included.

With a money factor equivalent of 0% APR, your payments should be $680.70 so the payments of $717 sound pretty close to reality. The money factor is pretty high though if it is adding upwards of $30/month.

I would try to negotiate the money factor down as much as possible. Ask them what money factor they are using the calculate the lease and then knock as much off it as you possible can. Easy shortcut for calculating money factor is to take an APR and divide it by 2400.

Also, why only a 12 month lease? You're paying for the greatest depreciation on the car during that period which is why your payments are so high.

 

I've also got the numbers for a 24 month lease and the payments are higher than a 12 months.

assuming $4000 down, a 24 month lease is $454, vs. $410 on a 12 month. 12 months is pretty much how long I'd want to keep the car.

I have this Expert Lease program, and I used it to figure out the values for the lease assuming $4000 down for 12 months.

Lease June 24, 2006

Vehicle: 2006 INFINITI G35 COUPE: (99366) 2DR CPE MANUAL
Invoice
$31,084.00

MSRP
$33,800.00

Options:
(-PT) STANDARD PAINT

(PR1) PREMIUM PKG Invoice: $2,456.00 MSRP: $2,850.00

(AER) AERO PKG Invoice: $474.00 MSRP: $550.00

(SRF) PWR SLIDING SUNROOF

(SRX) XM SATELLITE RADIO Invoice: $302.00 MSRP: $350.00

(TMA) TRUNK MAT Invoice: $64.00 MSRP: $80.00

Adjustment for Options Included In
Packages

Destination....................................... ....Invoice: $650.00 MSRP: $650.00
Margin over Invoice...........................………... 2.00% $700.00
Agreed Upon Value of Vehicle (Purchase Price).......………. Invoice $35,730.00 MSRP: $38,280.00
Capitalized StartUps (w/o Trade Equity)..................…….....
Other Adjustments....................................... .......…………...
Gross Capitalized Cost ………………………………………. $35,730.00
Less Cap Reduction Cash............................................…… - $4,000.00
Less Trade Equity ……………………………………………..
Adjusted Capitalized Cost.............................................. ..... $31,730.00


Lease Terms:
Months 12.0
Residual $27,561.60 72.0% of MSRP
Factor .0010564
APR 2.55%

Base Payment $410.00
Monthly Sales/Use Tax $24.60
Total Monthly Payment $434.60


Cash Required:

First Payment: $434.60
Security Deposit: $0
Tax on Cap Reduction: $240.00
==========================
Total StartUps (Cash) $674.60


Cap Reduction (Cash) $4,000.00
================================
Total Cash Required: $4674.60

I don't know if im doing this right, but plugging in the numbers the dealer gave me, it calculated a money factor of .0010564, which is equivalent to an APR of 2.535%

 

Hmm...I'll have to review the numbers when I have more time. That seems like a really low money factor though...

 

I just talked to the dealer and they said they are using a money factor of .00206.

I plugged this in the lease software and it is figuring a monthly payment of $473 including taxes. This is $63 more than what the dealer qouted me. So the dealer atually seems to be beating what the lease software calculates.


oh BTW, the dealer also told me the qouted price of $410 INCLUDES the 6% taxes. so it appears that they did calculate the extra $1230 correctly.

 

This is why I hate going to the dealership! Reading this thread makes my head hurt - I'm completely lost as to if this is a good deal or not.

 

yeah I know what you mean. I was taken pretty bad on a lease back in 03. I want to be sure it doesn't happen again.

 

Ok, I figured everything out (i think) with the given money factor of .00206.

The residual went from 72% to 74.7%

here are the numbers
12 month lease
MSRP:: $38,280
negotiated price: $35,730 ($2550 off MSRP)
Money down: $4,000
tax rate: 6%
monthly payments (including taxes): $410.00
residual value: $28.579.33 (74.7% of MSRP)
money factor: .00206 (4.984% APR)

 

wats the point of a 12month lease w/$4,000 down? Seems like a waste imo....if ur leasing something 4 such a small period of time, why would u want 2 put any money down at all?

 

I don't have to put any money down. But obviously, If I lease with no money down, then the payments would go up to $717. Its the same either way. I'll "save" $300 in the long run with no money down. $8,604 vs. $8,920.

 

this is like a crash review of my undergrad and CFA studies...

my head hurts too.

best of luck, though...

 

thats a lotta money for a car you'll only keep for a year...

 

Meh. Buy an Accord and drive it for 10 years.