48 month lease

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Apr 19, 2017 | 03:08 AM

Kultor311

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From: Virginia

48 month lease

I just signed a 48 month lease on RX350 . Dealer said I could trade out of the vehicle into another Lexus in 2 yrs and wouldn't be any more under water than if I had a 36 month lease. I've always done 36 month leases in the past and this doesn't feel right..

Apr 19, 2017 | 07:02 AM

Rudiculous

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From: SoCal

That's because you basically bought the car, another 12 months and it's a 5-year loan

Apr 19, 2017 | 08:26 AM

heffnerlex

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Joined: Nov 2015

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From: Ontario

Your dealer is kinda right. If you are under your kilometers and keep the vehicle in good shape, the buyout value after 2 years (remainder of payments plus residual) "could" be equal to wholesale (or trade-in value) and therefore they will be able to pull you out of your lease early without any penalty. Now if you get into an accident on the vehicle, over your kilometers, have damage on the vehicle, or the market on the RX collapses for whatever reason, then there is a higher chance they won't be able to get you out of your lease in 2 years without penalty. Hope this helps.

Also, posted in wrong thread FYI...

Apr 19, 2017 | 09:02 AM

isosunrise

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From: NJ

Quote:

Originally Posted by Kultor311

I did the same thing with my is250 in September 2015. I'm hoping to get out of my car in December 2017 (this year) during the September to remember event.

Apr 19, 2017 | 11:12 AM

harkirath

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From: California

I thought the event was December to Remember

Apr 19, 2017 | 12:14 PM

1Louder

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From: WA

Quote:

Originally Posted by Kultor311

It's water under the bridge but I don't think they were being completely honest with you.

Cars do not depreciate in a linear fashion (loose value at a set amount per month or year). It's a curve. They lose a big percentage the first year, a smaller % the second, less the third, etc. So the $ amount of depreciation from year to year gets smaller over time. But your lease payments basically pay off fixed dollar amounts each year. You should be less under water at 36 months than at 24. Otherwise what they are saying is the car is depreciating at the same rate you are paying, and that can't be true - at 48 months what you owe and what you've paid coverge. The one exception to that could be if you put a lot of money down. If you put like $8-10K down and have a small payment, I can see how that might be true (or closer to true). But if it was more of a standard $3-4K lease fee, I don't think what they told you can be mathematically accurate.

All that said, I if you are looking to trade out early the market value of the car will play a bigger role I think.

Last edited by 1Louder; Apr 19, 2017 at 12:18 PM.