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What Is A Good Lease Price


jm10388

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Hello, this is my first time posting.

I know that you may not be dealers, but I am looking to lease a new 2005 ES330 with just standard features. I want to put nothing down and 15k miles per year. Can anyone tell may what kind of monthly payment I should shoot for just through personal knowledge? Thanks a lot!

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It really depends on a lot of different variables, your credit score, how the taxes are worked out, how big a discount you can get on the price, where you live, etc.

Check out www.leasecompare.com they have excellent leases and a great payment finder that lets you play with options like mileage etc.

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In my Experience Lexus leases tend to be lousy. You'd also be in a bad negotiating position too seeing that the program ends on the 5th.

Check out LeaseCompare. Great company, easy to apply, and they have the best leases I've ever seen.

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If you do decide to lease the car through Lexus, they're going to try and negotiate with you using monthly payments. Don't. Negotiate on the price first (and you should get a significant discount on an ES330, $3000 or more) then tell them you want to lease and look over all the figures very carefully.

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Thats a pretty narrow view. Leasing may not be right for you, but it is right for many many consumers.

Leasing is a financial management tool. For a lot of consumers, like me, that can write a vehicle off for business expense, leasing makes a whole lot more sense than buying because of the percentage of the payment you can write off.

It can also be adventageous for people who would trade their vehicle in for a new one in 2-4 years time anyways and can often save them money and hassle with having to sell the vehicle or trade it in.

You also protect yourself from having to pay personal property taxes in states that have them, and sales tax in many other states.

If leasing didn't have a purpose it wouldn't exist. Is it right for everyone? No. Do people lease that probably shouldn't? Yes. Is it right for many people? Sure is.

I'm in Real Estate. Saying leasing is a terrible idea is as narrow minded as saying interest only or negative amortization loans are a terrible thing. All of these products are financial management tools and there are people who'se situations mesh well with their benefits. Again, are interest only loans right for everyone? No. Do people use them that probably shouldn't? Sure. Are there people who these loans are right for? Most definately and I meet them every day.

Suze Orman hates interest only loans too, but thats okay because I personally feel she thinks she knows a lot more about financial matters than she actually does. She has her opinion, and thats great but I try not to listen to her as much as possible.

She has her way of managing finances and many other "gurus" have different ways. She lost all credibility with me when she said on the air that people who use interest only loans should just rent. Thats about as ignorant a statement as can be made.

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I was looking on the Lexus website and although it says the Golden Opportunity Sales event ends Sept 5th, if you click on special leasing and financing it says on a footnote ends 9/30/05. So I do not know what that means. Does anyone know the details of the Golden Opportunity Sales event? They have not been published so I am led to belive I can get the same deal if not better deal at the end of Septemeber because it will get closer to 2006.

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Many people think that and you're right when it comes to other makes of cars, but not to Lexus vehicles.

Lexus stops producing a model year 2 months before the start of the next model year and through the end of August/beginning of september it gets difficult to find Lexus models on dealer lots. Prices on Lexuses can actually go UP at the end of the model year because the supply goes down.

Anyways if you're going to lease you should wait and lease a 2006. Leasing basically takes the difference between the purchase price and the projected residual value and finances that along with an interest rate they call the "money factor".

When comparing a 2005 and 2006 car at the same time, the payments will be lower on the 2006 even if you can't get as good a deal on it up front pricewise because at the end of the lease it will be worth substantially more, being one model year newer.

You can play with that on LeaseCompare too.

So, this time of year lease a 2006, buy a 2005.

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So I can get a 2006 cheaper than a 2005 in terms of monthly payments? I would think that I would not have any bargaining power over the price of a 2006. How cheap do ypu think I can negotiate the price of a 2006? I don't think I can get cheaper than 1000 off MSRP. Please help.

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I bet you can...

Again, you can play with all these lease payments at LeaseCompare.com but I'll work this scenario out for you.

2005 ES330 with preferred package (basic options) : $34830 Out the door price: $30830. Payment on 36 month lease with 15k, 700+ credit score and no money down: $494

2006 ES330 with same options, $34830 out the door: $32500. Same lease terms: $491

So in this scenario even though the out the door price was $2000 more, the payment is $3 a month cheaper and you get an 06 model year car.

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If you can not write off lease payments as a business expense, a "personal lease" is always a financial disaster. Even as a business expense, leasing is a questionable proposition and used only by businesses that are "cash poor". Do some research.

But yes, if you think you have to have a car every 2 - 3 years, then a personal lease may not be that much worse than an outright purchase. Whether you purchase or lease, you pay a very high cost if you have to have a new car every 2 - 3 years. As I have said before on this forum, the greatest economies are achieved by keeping a car as far past its depreciable life as possible - for personal cars, we (including my CPA wife) aim to keep a purchased car for at least 10 years.

Regardless of if a car is used for personal or business use, the lowest cost way to drive a car is to save up the money and pay cash. Paying cash puts you in the strongest position in the negotiation process and tends to moderate the cost of cars that are purchased. It is a very sobering act to write a check for an expensive car - it really makes you think about what you are doing and the choice you are making. If we can do it, anyone can.

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If you plan to buy the car after the lease you're always better off buying from the beginning, so if you plan to use a car for 10 years you obviously would not want to lease.

If you plan on changing vehicles every 2-4 years though, even if you can't write it off, leasing isn't such a bad idea because it protects you from some of the depreciation, as well as the savings on personal property and sales taxes (those that apply depending on your state). My accountant/financial advisor advised me to lease, and I did. I bought the car out of the lease in full to save the monthly expense while I start a new business but when I trade this car in 2-3 years I'll definately lease the next one. For me, it just makes sense.

As for it always being better to pay in cash, that too is a matter of opinion. Some advisors will tell you that, some won't. I prefer to look at financing options as financial management tools. Sometimes even if a person has the cash to purchase something like a car, the funds may be better served in some sort of investment program than being flushed down the toilet on a car.

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$491? That seems a bit to high. My cousin leased a base model I think MSRP was something around $32900 with zero down for something in the high threes. Generally lease compare I am finding the payments to be significantly higher. My Mercedes and Jeep are all at least $50 a month higher on lease compare.

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one of the few benefits of buying a car is yo can treat it how ever you want becuase at the end ot the day its yours....also isnt there like an in and out thing wih selling a used car? so when u go to the dealership to buy a new one you can get a lower interest rate...im not very familiar with this so some one can clarify

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$491? That seems a bit to high. My cousin leased a base model I think MSRP was something around $32900 with zero down for something in the high threes. Generally lease compare I am finding the payments to be significantly higher. My Mercedes and Jeep are all at least $50 a month higher on lease compare.

You also have to look at the terms of the lease, how high was the security deposit, what was the money factor, how is the credit.

I will tell you though you're not going to be able to lease a new ES for below $400 a month without putting money down, and you never EVER want to put any money down on a lease.

The only time you can get rates like that is through a manufacturer lease sale, and oftentimes these only apply to certain models and option combinations. Its possible he was able to do this but its severely limited as to what models and usually only for people with extremely good credit scores (800+) that almost nobody has.

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I leased a es 330. 3000 down 300 a month. I'm happy, cars great, might buy it when lease is up. Too much money to buy at that time. Better then driving GM junk, my Saturn VUE has been o.k. Dealer treats me great. I'm happy with it. Thats what matters.

Timothy

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No offense Tim, but Tim is an example of the kind of reckless leasing Suze Orman is talking about. Here's why:

1. Put money down on the lease to be able to afford the payments. NEVER EVER EVER EVER NEVER EVER put any money down on a lease. Its not your property and all you're doing is paying a portion of the lease payments up front. If the car is totalled you will loose that money and never get it back because the insurance company will pay the owner of the car, the leasing company, and you will be out of the lease but you will have lost your $3000. Much smarter to invest that cash, or use it to make monthly payments until it runs out, or even a portion of each payment. That way the money remains yours.

2. Plans on buying out of the lease. Buying out of the lease when the lease term has ended is always a lose situation because once you finance the remaining value of the car you've paid for the car almost twice. On top of that you now have an 8-9 year old car before your payments are done. It CAN be okay if you can buyout for cash, but only sometimes.

3. He leased because he could not afford to purchase the vehicle. The Lexus may be a lot nicer than a GM vehicle but if you could have afforded to buy a GM vehicle, or lease it for $0 down depending on your situation, you should have gone that route.

Remember leasing is a financial management tool, its not a vehicle for instant gratification.

You need to read the Orman article JeffR posted. Continued financial decisions like that could land you in trouble one of these days.

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No offense taken, thanks for the input. I leased at Meade Lexus Lakeside Utica MI. they also have Meade Lexus of Southfield MI. great dealerships. I know the pros and cons of leasing, I might buy out the car for the reason I would know the car and whats been done to it. I go by the book on taking care of this car, all at the dealer. This dealer will do tires and rims also, and will match prices on discount tire stores. I'm happy. Great site. Thanks again for all the input. Enjoy the weekend, drive safe.

Timothy

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the $399 deal was the Lexus national special. And if anything happens on a lease you Can get back the sales tax and money put down. Must insurance companies will pay out the full Nada value of the car which is generally higher then the payoff price. Plus you can get the sales tax from the state.

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