taigawoods

Thank you guys for the awesome information shared here. Because of it, I was able to get this deal.

I just leased a 2015 GS 350 F-Sport. Nebula gray with cabernet interior. $446/mo including tax. 36 months. 15k miles. Paid $3600 in MSD to lower my money factor to .00001. Drive off was DMV + fees ~$450. Sales tax where I live is 8%.

Steve Johiro from Longo Lexus was the Internet Sales Manager and he was excellent.

metrathon

I have a few questions about the lease calculator:

1. What is the Purchase Price? The price that the dealer is willing to give you before any manufacture incentive, trade in, etc?

2. What is Cap Cost Reduction?

3. What is Cap Cost?

4. Does MF influence the Monthly Finance Charge?

I gotta learn this stuff

jarabanos

1. The negotiated price at which the dealer agrees to sell you the car. This is before trade in, etc.
2. Anything that goes toward reducing the cap cost (explained in nber 3 below). This could be a trade, money down, dealer incentive, etc.
3. The amount being financed on the lease. This would include the purchase price plus any fees you're rolling into the vehicle like registration, acquisition, etc.
4. Yes. Lower money factor = lower interest rate = lower finance charge (also called a finance fee or rent charge).

Lexus GS3

iTrader: (2)

What is the MSRP on the car you got? $446 for 36 months and 15k is a GREAT DEAL!!!

metrathon

So the Cap Cost Reduction will be used to lower the price from the MSRP to the Purchase Price, right?

Thanks for the explanation, makes things much clearer.

jarabanos

No the cap cost reduction will be used to lower the purchase price. For example let's say MSRP is $58,0000. You negotiate to get the dealer to come down 10% off of MSRP. This is just basic wheeling and dealing at this point (no trade in, no money down at this point). Now you're at $52,200 which is the purchase price. Then let's say you have $2,000 cash to put down. This $2,000 is a cap cost reduction; that is, an amount that is placed toward lowering the total capitalized cost of the vehicle (which if you remember is the amount you're financing) thus lowering the amount financed and lowering your lease payment.

In general it's usually unwise to put money down on a lease because although your gap insurance coverage will cover the amount owed in the event you total the car, the money you put down will not be recouped. So if you put down $2,000 and total it a week later, you've now lost $2,000 in a week. A better idea is to put money towards an MSD (multiple security deposit). Each MSD you put down (you can do a max of 9) lowers your money factor by a pre-determined rate. A lower money factor means a lower interest rate and a lower monthly payment. Each MSD costs the amount of your monthly payment rounded up to the nearest $50. Then at the end of your lease, you get all that money back to use towards a future lease, down payment if you choose to buy, or cash back in your pocket.

Hope that helps!

jarabanos

Another way to think of Cap Cost Reduction is that you're pre-paying part of your total cap cost. In the end there's no benefit (yes you have a lower monthly payment but in the long run you're still paying the same amount of money).

rominl

iTrader: (4)

you should read here

https://www.clublexus.com/forums/car...nd-buying.html

BigB82

MSRP $58,220
Gross Cap Cost $51,492
Cap Cost Reduction $2,967
Adjusted Cap Cost $48,524
Residual $37,667

$0 out of pocket sign and drive, first month paid
total is $569 with tax in Orlando, FL
24 months 10k a year
Every other dealer wanted to charge me $650 for this car.

I bought the car yesterday came to this forum saw the MSD stuff went back today and was ready to put $4,410 as MSD to make my payment $490, however the finance guy as well as the sales manager who I personally know convinced me that its risky to leave that kind of money to lexus cause at the end of the lease they can sit there and deduct from there for wear and tear tires and whatever else they feel like.

Although I have leased from lexus for like almost ten years with no issues, even when I have overage on miles I never pay anything since I get another car, they take care of me, but when they told me the risky part I kind of felt that Lexus might pull a fast one knowing they have so much of my money and make up some crap, so considering it was $80 different I left it alone, but now I am having remorse lol what do you all think? I can afford it either way but would have been nice to stay at the same payment as my 13 GS and now having a GS F Sport 15 model but at the same time I can flip this money a lot more and make money with it.

The irony in all this is I own a used car business haha

Is this overall a good deal?

mso4

iTrader: (1)

I think your finance guy might have an ulterior motive. Especially considering the fact that he's in finance so should be well verse in this MSD stuff. The contract specifically says refundable deposit. Just because Lexus owes you money doesn't mean they are going to charge you more at lease end. Maybe he wants more interest out of you. But to put down $4400 and get about $2900 in return in three year is a no brainer for me.

mso4

iTrader: (1)

You have an F Sport so MSRP should be in the 55k+. Solid deal assuming no trade in or cash down (not including MSD). Congrats! I have yet to hear anything bad from Longo Lexus. If you're in CA, this is the place to go folks!

BigB82

what do you mean give $4400 and get $2900 back? Don't you get the entire MSDs back?

Also is it a decent deal regardless of MSD? Based on everything I have read here and edmonds seems like a great deal to me but want some surety i suppose

mso4

iTrader: (1)

Actually didn't realized you're doing a 24 month lease. So you said if you put $4400 down as MSD, your payment is $80 less a month. That saving is less interest money if you pay by giving them the refundable MSD now. Over 24 months you'll save a total of $80x24=$1920. So basically think of it as putting $4400 in the bank and in two years you would have saved $1920. Lexus sends you a check for $4400 at the end of your lease.

Only three reasons for not putting down MSD: If you don't have the money. If you think you might want to get out of your lease before lease end. Also if you think you can make more than $1920 in 2 years with $4400.

Your deal is decent. You didn't tell me your MF but I'm guessing it's around .001. The lowest I've heard is around .0006 and that would drop your monthly by $35. That comes out to about $850 over the life of your lease. Whether that's worth it is up to you.

BigB82

Appreciate it.

CUNNYJ

There are very good incentives on the GS right now. LFS has big rebates and very low MFs. I recently got a 2015 Fsport Crafted for 599/month with 15k/year and just first month and DMV upfront and it included a 3 year Tire and Wheel Plan from Lexus. Anyone in the NY/NJ/CT/MA area needs to go to New Country Lexus of Westport and see Mike B.