Am I getting the best leasing deal?
Registered User
Joined: Feb 2014
Posts: 1
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You don't care about the residual itself. You care about the difference between your "sale price" and the residual
MSRP is the number from which the residual is set by, in the G37's case residual is 72%
Sale Price is the number you negotiate to buy the car from
Residual is explained above.
$Sale Pricek
- $Residual
_____________
Total Payments (Depreciation + Rent)
So let's say MSRP is 40k. Residual is 28k. You negotiate the Sale price to 36k and let's say "rent" is $250
36000
- 28000
_________
8000
+ 250 Rent
___________
$8250 - This is your total price, no matter how you slice monthly payments/cap cost, plus fees/taxes etc.
I hope this got clearer for you, you seem to not understand the relationship between residual and what you're paying for the car over the life of the lease.
For clarity, "Rent" is the interest you pay over the life of the lease, based on money factor, and all figures here are just based on ballparks that I used to illustrate the point.
That's your per month lease tax. You still have to pay sales tax on the cap reduction/fees you're paying up front, FYI.
MSRP is the number from which the residual is set by, in the G37's case residual is 72%
Sale Price is the number you negotiate to buy the car from
Residual is explained above.
$Sale Pricek
- $Residual
_____________
Total Payments (Depreciation + Rent)
So let's say MSRP is 40k. Residual is 28k. You negotiate the Sale price to 36k and let's say "rent" is $250
36000
- 28000
_________
8000
+ 250 Rent
___________
$8250 - This is your total price, no matter how you slice monthly payments/cap cost, plus fees/taxes etc.
I hope this got clearer for you, you seem to not understand the relationship between residual and what you're paying for the car over the life of the lease.
For clarity, "Rent" is the interest you pay over the life of the lease, based on money factor, and all figures here are just based on ballparks that I used to illustrate the point.
That's your per month lease tax. You still have to pay sales tax on the cap reduction/fees you're paying up front, FYI.
I dont think anyone has explained the leasing scenario so lucidly to me yet. I have been researching lot of websites but this helps a lot..thank you.
I do have a follow up question though which is: As you mentioned that the MSRP and residual should be negotiated as that determines your Total payments (including Rent, which by the way I am not sure i completely understand, but i assume it is the monthly lease interest? ). So if i do not plan to buy the vehicle after the end of my lease, can i make the dealer give me a firm residual price? I havent asked this my dealer yet, but as i will go to him tomorrow, I will do it.
In my particular case, amongst other options, I am looking to lease a 2013 G37 Journey(Premium package).The numbers I have from the dealer for a 39 month/10,000 mile lease are:
Actual Price of Vehicle:34K approx
Sale Price:31K
Residual:22/23K (dont have it in written from him yet)
He is saying that including taxes etc, they can get my payments to under $300/month.
Any comments will be greatly appreciated.
Thank you.
Registered User
Joined: Feb 2014
Posts: 10
Likes: 0
Hello,
I dont think anyone has explained the leasing scenario so lucidly to me yet. I have been researching lot of websites but this helps a lot..thank you.
I do have a follow up question though which is: As you mentioned that the MSRP and residual should be negotiated as that determines your Total payments (including Rent, which by the way I am not sure i completely understand, but i assume it is the monthly lease interest? ). So if i do not plan to buy the vehicle after the end of my lease, can i make the dealer give me a firm residual price? I havent asked this my dealer yet, but as i will go to him tomorrow, I will do it.
In my particular case, amongst other options, I am looking to lease a 2013 G37 Journey(Premium package).The numbers I have from the dealer for a 39 month/10,000 mile lease are:
Actual Price of Vehicle:34K approx
Sale Price:31K
Residual:22/23K (dont have it in written from him yet)
He is saying that including taxes etc, they can get my payments to under $300/month.
Any comments will be greatly appreciated.
Thank you.
I dont think anyone has explained the leasing scenario so lucidly to me yet. I have been researching lot of websites but this helps a lot..thank you.
I do have a follow up question though which is: As you mentioned that the MSRP and residual should be negotiated as that determines your Total payments (including Rent, which by the way I am not sure i completely understand, but i assume it is the monthly lease interest? ). So if i do not plan to buy the vehicle after the end of my lease, can i make the dealer give me a firm residual price? I havent asked this my dealer yet, but as i will go to him tomorrow, I will do it.
In my particular case, amongst other options, I am looking to lease a 2013 G37 Journey(Premium package).The numbers I have from the dealer for a 39 month/10,000 mile lease are:
Actual Price of Vehicle:34K approx
Sale Price:31K
Residual:22/23K (dont have it in written from him yet)
He is saying that including taxes etc, they can get my payments to under $300/month.
Any comments will be greatly appreciated.
Thank you.
So if actual price is 34K even, residual is going to be 24.5 relatively. You get the sale price to 31k, and your total payments regardless of what you do with cap reduction is around 9.5K plus "rent" from your interest based on MF, plus tax, tags, title, delivery fee, etc.
Once you get to a price, if there's a cap reduction, ask him to run it doing MSDs instead of cap reduction and see where that gets you out of pocket.
Also, to add to my post about my deal, my dealer mistakenly figured my MSDs before the small cap reduction I did to get below the next $50 threshold. I had to re-sign my lease payments this week and I'm getting a check back from the dealer.
Hope this helped.
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FlyIce
G37 Sedan
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Sep 29, 2015 04:07 AM