Any Advice for Leasing a Car?

[Simba22]

Hello DISers!

I have never leased a car before and I was wondering if you could offer some tips/advice?

A lot of people have advised not to make a down payment, which I agree is a good idea.

However, I also read that when making a lease deal, you should bargain UP from the invoice price, not down from the sticker price. So essentially, it's saying that you should find out what the dealer paid for it, and try to negotiate from there, instead of trying to negotiate based on the sticker value.

I'm a bit confused as to how to accomplish this? I can't imagine that dealers just offer the invoice price to anyone who asks for it. My car is on it's last legs and I want to try and make a move into a new vehicle before this one leaves me stranded somewhere, but I want to feel fully prepared, and competent before going into a dealer.

TIA!

 

[golfgal]

Why are you leasing vs buying? I need to know that answer to that before I give any advice.

 

[1stluvispooh]

Lease = Fleece

Don't do it.

 

[penguin77]

First off I am a finance manager at a car dealer so I can tell you all about the good the bad and the ugly of leasing. If you tell me the car ant the options on it I might be able to tell you what is a fair price. If you just need quick pointers here are some.

1) be sure that you will not go over on your miles
2) DO NOT let the dealer simply talk in a form of payment
3) Make sure you know if the lease has any temination or buyout fees
4) ask what the "money factor" is. aka interest rate

 

[bored]

My advice would be don't do it! Leases

 

[dawson5]

Not a fan of leasing at all. I hate walking away from something after paying all that money and have nothing to show for it. ugh.

Hubby works at a dealership, he was looking into leasing a car (dealership pays for it). He said leasing is a thing of the past. Has not replaced his previous vehicle yet, he's using the summer car until this fall.

If you do decide to lease, try talking with your bank. I know it's not widely known or advertised, but some do do leases. Neighbor was in a nasty accident and didn't want to jump into a buying car right away. She leased a Volvo V70 for two years. Payments were about the same through a few lenders, but the buyout and lease end were entirely different. She ended up leasing through First Source because the end of the lease terms and the residual. She would have been able to purchase the vehicle for less than what it was worth I think.

This explains about residual value. Skimmed it, seems like what hubby has explained to me.
http://www.edmunds.com/advice/leasing/articles/46807/article.html

 

[vettechick99]

I leased a car and had a very good experience. Had a low down payment and monthly payment. Stayed under my miles and walked away from it. Not all lease experiences are bad!

 

[penguin77]

Leases ARE good options for some. However a lot of dealers train thier salespeople to use a lease to "close" thier customers by promising low payments, little to no cash, and simple options.

A lease is good IF you always like being in new cars. Meaning you trade out every 3-4 years. IF you are okay with always having a car payent. IF you don't drive a lot of miles. Or IF you are placing the car in a business name.

If you are looking to lease simply because it ia a low payment then your'e rying to buy to much car, and the dealer is using a lease low payment to justify it.

Not everyone that works in the auto sales field is a crook. you just gotta have the right connections .

 

[Simba22]

Whew! OK, glad I asked!!

I don't have a particular car in mind right now...although I love the new Toyota Venza. Toyota is my first choice, although I'd be willing to look at Nissan's (either the Rogue or the Murano).

The reason I was looking into leasing is this:

The car I have now, I bought brand new back in 2001. I just finished paying it off in December 2008. The sticker price was $12,000...after taxes, I financed $14,000....then I refinanced a year or two later. The car is now not even made anymore (Toyota Echo), and although it's still holding it's own, it's much too small for the lifestyle I lead now...9 years later. To be honest, it was too small 4 years after I bought it. According to KBB, it's worth about $800

I was looking into leasing because I am afraid of getting "stuck" with another car that I outgrow in a few years, and then by the time I pay it off it's not worth even a fraction of what I paid for it.

I wouldn't say I drive A LOT, but I probably would NOT stay within a mileage range of 12k per year. I'm willing to try and work that into the lease deal. A friend of mine said that sometimes, you can pay an extra fee (added into your monthly payment) to have either an extended mileage limitation (like up 18K) or no limit at all.

 

[bumbershoot]

I leased for 12 years. 3 cars. I was happy for 10 of those years.

Not one offered an increased mileage per year. With the last car, I went over, and for the last year had remembered the per mile cost...it was twice as much as I had remembered and had been calculating. OUCH. I have *never* heard of unlimited miles.

It's really surprising that your Toyota didn't keep much value. They usually do (though right now selling a Toyota is probably hard). But you've gotten 9 years of car for 14K+. Vs 3 or 4 years of car for the SAME amount, and probably more. And you're taking away nothing but experience with the lease, whereas with the owned car, you might take away $800.

Why wouldn't you do a down payment? It's less money that will have interest attached to it.

Know your end of lease arrangements like the back of your hand. You do NOT want surprises.

For me, the first two cars were turned in a bit early. They managed to indicate that my end of lease costs weren't charged...but the reality was, I realized about 11 years into the 12 years, they were just rolling them over into my payments. So at the end of my leasing time, I found out how nasty those could be.

It was lovely to have a new car every 3+ years (like I said, I turned the first two in a little bit early). It was lovely, before it made the papers that it's all carcinogenic chemicals, to have the "new car smell" for so long. At the time, the monthly costs seemed low. But now I've realized that I had to keep my insurance on the highest rung, and the stress of keeping the cars pristine did have a cost.

So as a former happy leaser, who has now seen the light to buying cars (outright buying, nowadays, even if I have to buy used), I would say if you truly know everything about the lease, if you can get every question answered, all info correct and up front (and you might want to check here to make sure you're not being "vagued" LOL), and you STILL want to do it, do it. Be happy with it. But you really might want to consider finding something used that will suit your purposes better, using the Echo to offset a little bit of the cost, and then start saving up for something you really really want.

 

[surfergirl602]

We lease a subaru. We love it. We are way under our miles, and the payment is very low. I love that car... but unfortunately we'll have to turn it in (or sell it) for a larger suv, as now with the baby coming soon, we don't all fit in it anymore.

 

[Mrs. Charming]

Buy the extra miles!! You never know when you're going to need to drive longer distances repeatedly! Ouch.

 

[penguin77]

I actually work at a Nissan dealership..... so I can easily tell you if your'e getting a good deal. With almost any lease 12k per year is the standard, but an adjustment to 15k miles per year chages the future value down by only 1 percent (about 8 dollars per month). buying up the miles gets very pricey though so be very carefull if that is the way you go.

Not to pry to much but is there a budget constraint with regards to monthly payment. The reason why I say that is all three cars you have mentioned have very good financing options available. Bboth the Vensa and Murano are pretty good sized vehicle so you may want to look into purchase.

Let me know if I can help.