2008 Lexus Rx 350 Lease

[smiley6]

Good morning.

I am leasing a 2008 Lexus RX 350 FWD with the

navigation system,

premium plus package,

tow hitch receiver,

all weather mats,

all windows tinted,

full size spare tire,

1 year of AAA for lexus.

for $43,500.00. Interest rate at 4.68 %. Money factor of .003. This is with $3300.00 down and $12000.00 for trade in at 48 months.

Monthly payment of $250.00.

Oh yeah this is out the door with everything included.

Is this a good deal?

[Wwerner]

You guys should be happy to get this prices. Just to let you know: The cost for a hybrid RX (4wheel drive) including those options is 91'000 CHF which is 72800 USD.

Any questions? :cries:

Regards

Werner

[JimsGX]

Good morning.

I am leasing a 2008 Lexus RX 350 FWD with the

navigation system,

premium plus package,

tow hitch receiver,

all weather mats,

all windows tinted,

full size spare tire,

1 year of AAA for lexus.

for $43,500.00. Interest rate at 4.68 %. Money factor of .003. This is with $3300.00 down and $12000.00 for trade in at 48 months.

Monthly payment of $250.00.

Oh yeah this is out the door with everything included.

Is this a good deal?

Something is off here with your interest rate calculation... A money factor of .003 equates to an interest rate of 7.2%, not 4.68%... You may want to take a closer look at the deal. What is the residual value, miles per year, actual MSRP with all options including freight? The selling price before deducting your $3300 down payment is $43,500? Do you know what portion of the agreed selling price is TTL and aquisition fee? Did they offer or explain to you about the option of using multiple deposits on the lease to decrease your payments? LFS was offering a deal like this. You could put down deposits equivalent to up to nine monthly payments on the vehicle in order to lower your monthly payments. These nine deposits were refundable at the end of the lease. Is the lease through LFS or another company?

[SW03ES]

Good morning. ...Oh yeah this is out the door with everything included.

Is this a good deal?

One thing. NEVER, EVER, EVER put money like that down on a lease. As a matter of fact, most leasing companies won't let you do it. When you purchase a car your downpayment is safe because you've built equity in the car, when you lease a car its not because you're just making payments in advance. If you were to total your car, you would probably loose that entire downpayment. Not to mention you're missing the point of leasing, the point is to get you into a car with a lower more tax friendly payment for little or no drive off costs.

The only safe way to do it is to put that money into a money market account and make the payments, or a portion of the payments out of the account. Lexus also offers a multiple security deposit deal that works well to lower the payment (You can make up to nine $600 security deposits you'll get back plus interest after the lease or if the car is totalled providing you have gap insurance). Lowers the payment probably $175.

As for the interest rate Jim is right, with a money factor of .003 the effective rate is 7.2%, which is about right for a LFS lease with good credit. You can always tell the interest rate by multiplying the money factor by 2400.

[smiley6]

I am using the multiple security deposit option where I maxed out the 9 security deposits and almost all of the money I am putting down is used for the multiple security deposit. Plus I am getting the gap insurance. I know its alot of money to put down but I wrote off that $12000.00 basically. The $3300.00 is a gift for my birthday so I am not really out anything.

The $12000.00 is a trade-in that I owned out right and I was tired of that vehicle so at least this way I get a vehicle that I want. The most important thing to me right now is to get the vehicle I want with the low payment. I don't use my vehicle alot so at the end of the lease, I would most likely buy the vehicle because in 3 years of owning my previous car, I had low miles.

You are absolutely right about the lease factor / interest rate. I must have misunderstood or wrote down the wrong number. I contacted them to reconfirm the number.

Just to be sure, the multiple security deposit works like this: if I make a $1200.00 deposit, then I would be able to make make (9) additional deposits of $1200.00?

I appreciate all the help from this website. Since I am new to leasing, the research I had done plus the advice from people has helped greatly.

[SW03ES]

9 security deposits is only $4,590. Where's the rest of the $12,000 going? Lexus' security deposit on a lease is $510 for an RX. You may make nine depsoits of $510 for a total deposit of $4,590

Leasing is a very misunderstood process and dealers use it to con people into buying cars they cannot otherwise afford. There are several tenets of leasing:

1. Never put any money down

2. NEVER buy the car at the end of the lease unless you can immediately sell it for a profit or are going to pay cash, you will ALWAYS spend more on the car than if you'd just bought it in the first place.

3. NEVER negotiate with the lease payment, negotiate the price first, THEN the financing.

What kind of discount does $43500 provide off the MSRP?

And what is 1 year of AAA for Lexus? Lexus vehicles come with 4 years of Lexus roadside assistance built in.

What term is the lease for, 36 or 48 months? I'll assume 36.

Lets do a little math.

Lease then buy:

Downpayment $15,300

Total of payments for 36 months: 9,000

Residual purchase Price at lease end: 24,000

Less credit back on LFS Security deposit: $19,400

Sales tax on buyout assuming 5%: $970

Interest rate on lease buyout purchase and term: 8.7% @ 60 months.

Total Payment: $399.89.

Total interest over term: $5682.60

SO, it will cost you $50,382.60 to lease this car, then buy it at the end.

Now, if you bought it from the start:

Purchase price: $43,500

Sales tax: $2,171

Downpayment: $15300

Financing terms: 60 months @ 6.8%

Payment $457.20

Total Interest: $4,232

So, its cost you $49,903 to buy the same car.

Thats assuming that Lexus' residual is $24,000. Its probably more to get to a payment of $250.

We need to know what the residual after 4 years is on this lease to see how bad a deal this is for you...

[smiley6]

I am leasing the vehicle for 48 months. The good thing about this is that I have not signed any papers yet. It looks like it would be better for me to buy this vehicle right out at $43500.00. That included everything I listed above and I do have excellent credit.

For what I listed, is $43500.00 a good or bad price for that 2008 RX 350? It includes taxes, all fees, etc.

I am confused right now. The sales manager is telling me that with $12000 down as trade-in and #3300 down, I will have a monthly payment of $250.00 for 48 months.

What do you suggest that I do? I like the vehicle and want to keep it. I was going to lease it and purchase it at the end of the lease (cash buyout). Basically having low monthly payments then making a balloon payment at the end.

Or I could have larger payments over the life of the loan but it could be mine.

[SW03ES]

Its 48 months? Thats gonna make it even worse.

What we need to know is what is the MSRP of the car (the price on the sticker)? We don't get the FWD RX here with any package but base so I have no idea what it costs. An AWD RX costs about $45,500 MSRP here with the top package, so the FWD one is probably about $43,500 MSRP, making that a bad deal.

For the lease, we need to know what the residual value is. This is really important if you want to buy the car at the end. A low residual means higher payments but lower buyout, a higher residual means lower payments and a higher buyout.

Normally I am dead set against 72 month car loans because the owner is almost always upside down for a time (meaning they owe more than the car is worth). However, with you putting that much down thats probably not going to happen, so I might look into a 72 month loan if keeping the payments down is a priority.

The name of the game for leasing is no money down and walk away at the end, thats how it makes sense. I'm also an advocate of no or low risk purchasing decisions. If you put all that money down on a lease, you are in serious risk of losing it should something happen to the car.

If you have good credit check out these guys or your local credit union:

www.capitaloneautofinance.com

Lexus' rates are not very good, but their financing is easy to get.

There's nothing wrong with leasing, leasing is an amazing financial management tool, but you have to lease for the right reasons. Do you own a business, or itimize business deductions on your tax return?

[smiley6]

This is from MSN Auto invoice and MSRP prices.

2008 Lexus RX 350

Invoice MSRP

33099 37400 - Base Price

2225 2650 - Navigation System

1854 2060 - Premium Plus Package

95 95 - All Weather Mats

295 415 - Tow Hitch Receiver with Ball Mount

396 495 - Full Size Spare

715 715 - Destination Charge

38188 43240 - Total Cost

Now these numbers are from MSN Auto. They are also tinting the car for me.

According to Lexus, they said I would have an "out the door" cost of 43500.00.

How does this sound to you? Good or bad? This looks good here but I am sure that I may be missing something here. I will check out capital one finance and other finance companies to see what their finance rates are.

[SW03ES]

Whats sales tax in FL again, 7%? So out the door includes the 7% tax?

Have you talked to other dealers? You should.

I ask this because you should be getting several thousand dollars off the MSRP on this vehicle.

You also need to ask the sales manager what the residual is on this lease. You need this information to compare a lease:

Capitalized cost (sales price)

Cap cost reduction (down payment)

Money factor (interest rate)

Mileage restrictions and penalties

Security Deposit amount

Acquisition fee

Residual

[JimsGX]

Whats sales tax in FL again, 7%? So out the door includes the 7% tax?

Have you talked to other dealers? You should.

I ask this because you should be getting several thousand dollars off the MSRP on this vehicle.

You also need to ask the sales manager what the residual is on this lease. You need this information to compare a lease:

Capitalized cost (sales price)

Cap cost reduction (down payment)

Money factor (interest rate)

Mileage restrictions and penalties

Security Deposit amount

Acquisition fee

Residual

Smiley6,

Here's a link that will help you out...

Calculate Lease Payments

[smiley6]

Yes, out the door includes sales tax, all fees, etc so I am paying for the vehicle and all fees which will total $43500.00. I have spoke to Lexus of Tampa Bay and Clearwater and they wont go as low as this. Lexus of Orlando is the only one that has given me this offer and I am leaning to them because of the offer plus they are not over a 100 miles from me. I tried calling them today to find out more details but he was out today. I don't have all the numbers because they did not have the vehicle I wanted in stock and they said it was at the port in Jacksonville so they did not want me to start any paperwork until they were absolutely sure that they had the vehicle and there was nothing wrong with it.

Sales tax in Orlando in 7 %. I was going to go through AAA or one of those auto buying service but I don't have either.

I am just going to put down a little extra money and buy the vehicle. You had a very good point. If I am going to put down all that money, it would just be better for me to buy the vehicle right out.

[SW03ES]

If that includes everything thats probably fairly good since the 08s just came out.

I think you're making the right decision, better off buying from the start if you're gonna put the cash down and keep it long term. Do shop that financing though, at 7.2% for 60 months and 8% for 72, their rates are very poor for 720+ credit. I bet you can get close to 6 for 60 months, 6.5 maybe for 72.