Never leased before--this deal looks great. Am I missing something?
#46
Lead Lap
Note that, once you have an offer like that one, you can use it to solicit better offers by giving the other dealers that you have been communicating with the opportunity to beat that price to earn your business. If you start with, say, 6 or 7 dealers, even if only 2 or 3 of them are willing to be competitive, the competition between them can drive the price down significantly. The key is to get them into the competition via only phone and email contact until you have an offer to which you are willing to commit because, once they get you into the dealership, you have transferred much of the control in the buying process from yourself to them.
I also note that, while that price is getting into the range that I would consider to be good, there are several items in the offer that fall into the category of "profit padding" items. The window tint charge, which isn't excessive, is a dealer installed option that comes with a higher profit percent than the rest of the car. The range of doc fees in Arizona is from $199 to $539. So, this dealer's $489 doc fee is toward the top of the range. Dealers are required by law to charge all of their customers the same doc fee. So, you can't negotiate the doc fee, but you can negotiate to have them lower the selling price of the vehicle to compensate for the high doc fee. I'm not sure what you are getting for the $180 charge for "accessories", but I'm confident in guessing that, whatever it might be, it is a high profit item. Data dots is a process in which nearly invisible markings are put in various places on the vehicle and that are supposed to aid in vehicle identification if the car is stolen. The $268 charge for it is virtually all profit. If you put together all of those add-on items, I'm confident in guessing that there is $600-700 of nothing but added profit for the dealership built into those numbers, and, when I am evaluating an offer from a dealership, I consider those profit building items to be a reduction from the nominal discount being offered on the car.
#47
Racer
Thread Starter
#48
Lexus Test Driver
Guess I missed the part where you said this offer was from an AZ dealer - that's a pretty good quote - rivals CA deals. In the grand scheme of things, the 700 bucks is not that big a deal - you'll probably need to wait a few months to land a similar deal on a 2018 - and I think you said you needed a vehicle fairly quickly.
#49
Instructor
#50
Racer
Thread Starter
I would like to thank everyone on here for their comments. I don't know a thing about leasing so you have helped quite a bit.
So there are some complicating factors that I am not disclosing just yet.
But I think I have found the best solution, and I think I am happy with this result.
The dealer just sent me this before they closed. I have a couple questions on it but will ask him in the morning. I figured I'd post it here to see if anyone could help in the meantime.
This deal looks good. I know the Doc and Auto Dots bull**** is still on there, but I am looking at the TOTAL cost of the car. Yes, they increased the money factor from the .00001 to .00055 (still 1.2% apr), but I found out that if I LEASE the car, I don't have to pay the Scottsdale, AZ 1.65% City Tax ($704) that would be on a purchase.
He told me over the phone that we would be at $42,027 for the car, which seems to not include the $795 Lease Acquisition Fee.
1. Why is there a $573.71 Payment in the Capitalized Initial Fees spot? Shouldn't the CAP Cost NOT include the first month's payment?
2. Why is the $573.71 essentially zeroed out in the 4th set of boxes down, with a $0 Due On Delivery? I know I'm supposed to have a $0 Down lease but this doesn't makes sense. Do I have 35 payments left now?
3. The $180 is for tinted windows, btw, in case anyone was still wondering.
I am going to drive the car 25k miles per year but will either sell it to a private party or buy it myself at the end of the lease. I am going set aside $75/month into an account in case I have a little negative equity when that time comes. Most likely I will keep it.
I just sold my 2010 IS 250 AWD with 170,000 Miles on it. Purchased new, of course, by me, and the interior still looked brand new with that beautiful semi-aniline leather!
Again....with a total car price of $42,027 (that figure doesn't include the $795 Acq. Fee), I am 100% Happy with the payment and the price of the car. (Hint: I don't have to drive to CA to pick the car up, let's just put it that way. )
Thoughts.....???
One more thing....this car has those hideous body side moldings installed OEM......how hard is it to get them removed? Can I ask the dealer remove them??
So there are some complicating factors that I am not disclosing just yet.
But I think I have found the best solution, and I think I am happy with this result.
The dealer just sent me this before they closed. I have a couple questions on it but will ask him in the morning. I figured I'd post it here to see if anyone could help in the meantime.
This deal looks good. I know the Doc and Auto Dots bull**** is still on there, but I am looking at the TOTAL cost of the car. Yes, they increased the money factor from the .00001 to .00055 (still 1.2% apr), but I found out that if I LEASE the car, I don't have to pay the Scottsdale, AZ 1.65% City Tax ($704) that would be on a purchase.
He told me over the phone that we would be at $42,027 for the car, which seems to not include the $795 Lease Acquisition Fee.
1. Why is there a $573.71 Payment in the Capitalized Initial Fees spot? Shouldn't the CAP Cost NOT include the first month's payment?
2. Why is the $573.71 essentially zeroed out in the 4th set of boxes down, with a $0 Due On Delivery? I know I'm supposed to have a $0 Down lease but this doesn't makes sense. Do I have 35 payments left now?
3. The $180 is for tinted windows, btw, in case anyone was still wondering.
I am going to drive the car 25k miles per year but will either sell it to a private party or buy it myself at the end of the lease. I am going set aside $75/month into an account in case I have a little negative equity when that time comes. Most likely I will keep it.
I just sold my 2010 IS 250 AWD with 170,000 Miles on it. Purchased new, of course, by me, and the interior still looked brand new with that beautiful semi-aniline leather!
Again....with a total car price of $42,027 (that figure doesn't include the $795 Acq. Fee), I am 100% Happy with the payment and the price of the car. (Hint: I don't have to drive to CA to pick the car up, let's just put it that way. )
Thoughts.....???
One more thing....this car has those hideous body side moldings installed OEM......how hard is it to get them removed? Can I ask the dealer remove them??
Last edited by 355F1; 09-19-17 at 10:43 PM.
#51
Instructor
You can't remove anything on a lease. They want the car returned as it was equipped, no mods.
#52
Lexus Fanatic
This looks better. The .00055 strikes me as a correct MF, I've never seen the MF as low as .00001 on a Lexus.
With Lexus, when you ask for "$0 down" they mean "$0 down", so they actually wrap the first months payment into the lease, so you will make 35 additional payments. They can break it out and you can pay it at drive off if you want and it will reduce the payment slightly ($573.71/36=15.96 the payment should go down). As it is now, you will drive off and pay them nothing.
IMHO this is a very good lease on this car.
This depends on the state you live in, has nothing to do with the deal on the car. States either charge a monthly use tax on the car, or collect the sales tax upfront.
With Lexus, when you ask for "$0 down" they mean "$0 down", so they actually wrap the first months payment into the lease, so you will make 35 additional payments. They can break it out and you can pay it at drive off if you want and it will reduce the payment slightly ($573.71/36=15.96 the payment should go down). As it is now, you will drive off and pay them nothing.
IMHO this is a very good lease on this car.
This depends on the state you live in, has nothing to do with the deal on the car. States either charge a monthly use tax on the car, or collect the sales tax upfront.
#53
Lead Lap
There sure is a big difference between this lease offer and the ones that you were considering to start with.
By doing the 15k miles/year lease, you are locking yourself into having to buy the car at the end of the lease, and, because of the extra miles beyond 15k/year that you will be putting on the car, you will be buying the car for probably $3000 more than it will be worth at that time, but, by doing so, you will have lowered the total cost of your monthly payments by about $6000, and that puts you $3000 ahead.
I also note that your total net cost for this lease will be $6500+ less than what would have been the total cost of the lease offer in your first post in this thread.
I think that this thread is a good example of why car dealers like to do leases. With so many factors to consider, I suspect that the majority of customers neglect considering one or more of those factors, and that ends up resulting in extra profit for the dealership. For example, even if the customer negotiates a good price on the car and if the money factor being offered is good, failure to consider the optimal mileage allowance for the lease can cost the customer lots of extra money. If the customer underestimates the miles that the car will be driven, he/she will pay through the nose for those extra miles when the car is returned at the end of the lease. On the other hand, if the customer overestimates the miles that will be driven, he/she can be paying a hefty price for more miles than necessary and will be returning a car to the dealer that is worth more than the nominal residual value.
In this case, by buying the car at the end of the lease, you won't be paying high excess mile charges, and you will you will not be paying for miles that you didn't use, and that is what will allow you to be saving several thousand dollars over the other lease options.
By doing the 15k miles/year lease, you are locking yourself into having to buy the car at the end of the lease, and, because of the extra miles beyond 15k/year that you will be putting on the car, you will be buying the car for probably $3000 more than it will be worth at that time, but, by doing so, you will have lowered the total cost of your monthly payments by about $6000, and that puts you $3000 ahead.
I also note that your total net cost for this lease will be $6500+ less than what would have been the total cost of the lease offer in your first post in this thread.
I think that this thread is a good example of why car dealers like to do leases. With so many factors to consider, I suspect that the majority of customers neglect considering one or more of those factors, and that ends up resulting in extra profit for the dealership. For example, even if the customer negotiates a good price on the car and if the money factor being offered is good, failure to consider the optimal mileage allowance for the lease can cost the customer lots of extra money. If the customer underestimates the miles that the car will be driven, he/she will pay through the nose for those extra miles when the car is returned at the end of the lease. On the other hand, if the customer overestimates the miles that will be driven, he/she can be paying a hefty price for more miles than necessary and will be returning a car to the dealer that is worth more than the nominal residual value.
In this case, by buying the car at the end of the lease, you won't be paying high excess mile charges, and you will you will not be paying for miles that you didn't use, and that is what will allow you to be saving several thousand dollars over the other lease options.
#54
Lexus Fanatic
Only thing is the dealers don’t get anything for excess mileage charges. That’s a charge assessed by the leasing company, in this case LFS. The dealer quite literally doesn’t care what you do in terms of mileage, etc. They make money based on the sales price, fees they charge, and commissions for selling the lease itself, they can inflate the money factor and derive profit there also.
#55
Lead Lap
Only thing is the dealers don €™t get anything for excess mileage charges. That €™s a charge assessed by the leasing company, in this case LFS. The dealer quite literally doesn €™t care what you do in terms of mileage, etc. They make money based on the sales price, fees they charge, and commissions for selling the lease itself, they can inflate the money factor and derive profit there also.
#56
Lexus Test Driver
I would like to thank everyone on here for their comments. I don't know a thing about leasing so you have helped quite a bit.
So there are some complicating factors that I am not disclosing just yet.
But I think I have found the best solution, and I think I am happy with this result.
The dealer just sent me this before they closed. I have a couple questions on it but will ask him in the morning. I figured I'd post it here to see if anyone could help in the meantime.
This deal looks good. I know the Doc and Auto Dots bull**** is still on there, but I am looking at the TOTAL cost of the car. Yes, they increased the money factor from the .00001 to .00055 (still 1.2% apr), but I found out that if I LEASE the car, I don't have to pay the Scottsdale, AZ 1.65% City Tax ($704) that would be on a purchase.
He told me over the phone that we would be at $42,027 for the car, which seems to not include the $795 Lease Acquisition Fee.
1. Why is there a $573.71 Payment in the Capitalized Initial Fees spot? Shouldn't the CAP Cost NOT include the first month's payment?
2. Why is the $573.71 essentially zeroed out in the 4th set of boxes down, with a $0 Due On Delivery? I know I'm supposed to have a $0 Down lease but this doesn't makes sense. Do I have 35 payments left now?
3. The $180 is for tinted windows, btw, in case anyone was still wondering.
I am going to drive the car 25k miles per year but will either sell it to a private party or buy it myself at the end of the lease. I am going set aside $75/month into an account in case I have a little negative equity when that time comes. Most likely I will keep it.
I just sold my 2010 IS 250 AWD with 170,000 Miles on it. Purchased new, of course, by me, and the interior still looked brand new with that beautiful semi-aniline leather!
Again....with a total car price of $42,027 (that figure doesn't include the $795 Acq. Fee), I am 100% Happy with the payment and the price of the car. (Hint: I don't have to drive to CA to pick the car up, let's just put it that way. )
Thoughts.....???
One more thing....this car has those hideous body side moldings installed OEM......how hard is it to get them removed? Can I ask the dealer remove them??
So there are some complicating factors that I am not disclosing just yet.
But I think I have found the best solution, and I think I am happy with this result.
The dealer just sent me this before they closed. I have a couple questions on it but will ask him in the morning. I figured I'd post it here to see if anyone could help in the meantime.
This deal looks good. I know the Doc and Auto Dots bull**** is still on there, but I am looking at the TOTAL cost of the car. Yes, they increased the money factor from the .00001 to .00055 (still 1.2% apr), but I found out that if I LEASE the car, I don't have to pay the Scottsdale, AZ 1.65% City Tax ($704) that would be on a purchase.
He told me over the phone that we would be at $42,027 for the car, which seems to not include the $795 Lease Acquisition Fee.
1. Why is there a $573.71 Payment in the Capitalized Initial Fees spot? Shouldn't the CAP Cost NOT include the first month's payment?
2. Why is the $573.71 essentially zeroed out in the 4th set of boxes down, with a $0 Due On Delivery? I know I'm supposed to have a $0 Down lease but this doesn't makes sense. Do I have 35 payments left now?
3. The $180 is for tinted windows, btw, in case anyone was still wondering.
I am going to drive the car 25k miles per year but will either sell it to a private party or buy it myself at the end of the lease. I am going set aside $75/month into an account in case I have a little negative equity when that time comes. Most likely I will keep it.
I just sold my 2010 IS 250 AWD with 170,000 Miles on it. Purchased new, of course, by me, and the interior still looked brand new with that beautiful semi-aniline leather!
Again....with a total car price of $42,027 (that figure doesn't include the $795 Acq. Fee), I am 100% Happy with the payment and the price of the car. (Hint: I don't have to drive to CA to pick the car up, let's just put it that way. )
Thoughts.....???
One more thing....this car has those hideous body side moldings installed OEM......how hard is it to get them removed? Can I ask the dealer remove them??
Just confirmed - the current base MF is the original .00001 you were citing. Unless there are credit issues involved, that's what you should be getting - like lesz says, they are padding the profit a bit jacking up the rate.
Last edited by gmanusmc; 09-20-17 at 10:47 AM.
#57
Lead Lap
If you choose to go that way, I'd suggestion soliciting offers from the Texas dealers who have, in recent months, been selling at very low prices. Even if you have no desire to drive to Texas to buy a car, if you get a good offer from one of those Texas dealers, you can use that as leverage to get the Arizona dealer, at a minimum, to reduce the price to offset some of those "profit padding" charges that have been added into your deal, such as the Data Dots, the high doc fee, etc. If cutting the cost of those items from the final price has the potential of making the difference between getting a sale or losing a sale, dealers will typically be willing to do so.
#58
Lexus Fanatic
That’s an amazing money factor on the ES, .00001 wow.
Yes I would push for that and tell them that is all that’s in between you and a deal.
Yes I would push for that and tell them that is all that’s in between you and a deal.
#59
Racer
Thread Starter
I've had deals written up with 7 Lexus Dealers now and this is by far the best, AND the most convenient.
The convenience factor alone is worth the extra $20/ month on the payment for their increased MF.
Trust me....most dealers aren't wanting to make cheap af deals on these last ULs; if I wanted a regular ES they told me they would have no problem giving me a higher percentage off MSRP. But I want the semi-aniline leather and nothing else!
Last edited by 355F1; 09-20-17 at 12:14 PM.
#60
Lexus Test Driver
I'm already committed. Even with their padding of the MF I'm still okay with it. And this dealer sucks. Their customer service sucks so badly and I wish I didn't have to buy anything from them. They are kind of dicks and don't return calls or emails. I don't think they WANT to sell me this car for this price and were probably hoping would just walk away.
I've had deals written up with 7 Lexus Dealers now and this is by far the best, AND the most convenient.
The convenience factor alone is worth the extra $20/ month on the payment for their increased MF.
Trust me....most dealers aren't wanting to make cheap af deals on these last ULs; if I wanted a regular ES they told me they would have no problem giving me a higher percentage off MSRP. But I want the semi-aniline leather and nothing else!
I've had deals written up with 7 Lexus Dealers now and this is by far the best, AND the most convenient.
The convenience factor alone is worth the extra $20/ month on the payment for their increased MF.
Trust me....most dealers aren't wanting to make cheap af deals on these last ULs; if I wanted a regular ES they told me they would have no problem giving me a higher percentage off MSRP. But I want the semi-aniline leather and nothing else!