slowandlow

actuley how this works is they make money on both cars so they sell your car for 5k and they sell you a car for a few k over invoice. the car proabley has less options

passnu2

iTrader: (33)

the payment is right because he is not paying the full NOTE of the car. You only pay a percentage of the car, sorry I cant recall. But you are paying over 48 mos and you may have a balance of 20k (more or less) to pay at once when you are at 48 mos. so you are not really financing the full 35k or what ever the cost of the car is. But at this point you must take out another loan to pay off the balloon payment or sell the car, ect...So the option and info is correct. You just need to see how a balloon payment works. Trust me this can be done and so could a lease for that matter. You can get pretty close to that payment on a 39 month lease and just hand in the keys. IMO I would take my chance with the lease over the Balloon option.

IMO to the OP I would just make sure they explain everything to you. Call your local bank and ask them to explain it or call the dealer and ask for the F&I Director and have them go over it in detail. Just be careful as it gives them ways to hide more profit.

Good luck!

Joeb427

iTrader: (1)

My bad.

He would owe for the new '08 only.
Still if he pays $35K for the '08 and finances the $35..


Monthly payment: 4 Years
Interest rate: 0.000%
Loan amount: $ 35,000.00
$ 729.17 a month

Still not $5 less than his current payment.
The dealer must be talking lease,not purchase.
Unless it's a balloon payment in the end which isn't a good idea.

Joeb427

iTrader: (1)

I understand.
I've never heard of a balloon payment on a car.
A house but not a car.At least from a auto manufacturer,anyway.

passnu2

iTrader: (33)

its been around for years but not so commonly used. It was used mainly to help those who wanted to purchase and couldn't afford the car. It was a way for them to live out side of their means and have an option at the end. Really with leasing as an option it doesn't make sense IMO to take the chance. You are taking the risk of where the market will be and what the car will be worth. I would hate to get stuck with a payoff at the end for a car that is worth much less for whatever reason. I personally wouldn't do it

cliffud

iTrader: (3)

This is just the dealer's way of selling a new car. Basically what you'd be doing is trading in your 06 IS250 for something like 22k-23k, then they roll the difference between your trade in and the payoff amount into the new price of the new car.

As one of the other posters commented, this is possible if you had a terrible interest rate in the past and now you qualify for a lower interest rate.

The big question is - how did the dealer know what interest rate you qualify for?

The answer is - they don't.

I used to work at a car dealership and this is what usually happens. You to go in, try out the new car, get hooked, they'll show you the numbers, the numbers may come in as planned but they may not (which is more likely) and then they'll ask you for more money.

If you've got an afternoon to burn, go ahead and go in to see what happens but if it were me personally, I wouldn't see any value in going in for a 2 year difference on the same car.

rdgdawg

+1... if you REALLY want to get technical, any lease where you take the buy option (unless you really worked the finance dept- GOOD LUCK, they bury these fees on leases) has a balloon as the residual value is more than what the car is worth.... so if for example the residual is $21K (notice how they always "guarantee" a high residual) and the car is worth $18K...

Why would I pay an extra $3K when I can go get one for $18K???... but to own it, I gotta pay it.... hence the "balloon"... they also do this (balloon) to stick the big "down payment" at the end of the term so you can "purchase" the car (with all it's depreciation, wear, etc.)... but hey, you kept your payments down...

fasteddy91

iTrader: (5)

how many months do you have left in your current loan? how many months will the new loan be? any down payment or balloon payment?

kensteele

i believe the balloon payment that you guys keep referring to is illegal in most states on a car loan. i dunno about leases but no way can you hide a couple of huge payments in a car loan like that, it's unlawful.

XprincoX

iTrader: (10)

an interesting article on luxury car values if you do go with the lease option
http://biz.yahoo.com/brn/080516/25297.html?.v=1

passnu2

iTrader: (33)

this is very true I have been trading in my leased cars since 99 and always had more in them being upside down on mileage one of these days its going to bite me in the *ss