Can you or anyone tell me why put down payment is bad idea on a lease?..."down" payment work lil differently on lease than if you purchase, not all the down payment apply to the cap. reduction on a lease, cus there are fees involed, like first month payment, TAX on cash down, DMVs, acquisition fee, and other paper work fees, so the amount apply to the sale price is lower....the down payment dont just disappear into thin air, it reduce the amount you owe.

 

JMHO...
If the only way you can get into a car is by leasing.....you can't afford the car.

Leasing is entirely mis-used these days.
It only makes sense when you can use it as a business expense.

 

those are from auot leasing group 11/05 for the 05's

 

Keep in mind that in leasing terms the 05 is technically a one year old car already, since the 06's are out. Which means that they will be charging a higher monthly payment because you will be essentially leasing a one year old car. Lower residual means higher payment. You may want to look into the price of leasing an 06 which will have a higher residual.
Lips

 

Thats true... to a point, do you know what are the difference in the end of 5 years term? if you purchase a car at 35k and leased same car? about 500 dollars!...of course thats bit mis-leading because in the end you have to financing the residual form the leased car, BUT the monthly payment is 718 vs 509, if you save that 210 every month? it would be enough to pay the residual off in the lease end...

 

Bottom-line don't lease your cars, purchase your automobiles so at least after your finished with it you can get some money back to put towards the downpayment of another car of your wishes. Cant do that with a lease you have to start all over again. Please dont make these dealerships richer by leasing and paying them rent for a car.

 

hmm lots of generalizations here.
First off, on why you dont want to put down mone, let me ask you this, if you were renting your apartment would you go up to your landlord and volunteer to put up 4k of your rent money, so you can reduce your rent each month for next 3 years. It really doesnt make sense.

You can amortize your taxes fees and bake them all into the monthly payment. Why tie up your capital when you dont have to. And that goes to the heart of leasing.
Yes it has many drawbacks, but the concept is genuinely sound. Why pay interest to own something that is naturally going to depriciate. Why not just pay for the depriciation and for that matter taxes on only that portion.
Would you finance a house that would lose half its value in 2 years, and wind up owing more than its worth for a good portion of the loan?

Again these are just general pros and cons with leasing, indeed there are many drawbacks. Im running into one right now,i want to upgrade my tires/rims, not really worth it on a lease.

Anyway, specifically on Infinti leases- IFS subvents or subsidizes their leases quite a bit. That is their financial services subsidises lower interest or money factors to help move their cars.

As for the 05 cars not worth leasing, IFS sets both the residual value and the interest rate (Money factor). They make both very appealing on the cars they want to move, ie 05s. As an example, the residual and mf on an 05 i was looking at was 58percent with a mf of .00113. Compare that with acura, who was at 56 percent and .00240.
What does this mean in monthly terms, well the TL which was over 5k less than the g35x in the 05, came out with a much higher monthly lease payment than the infiniti. This really boggled me for a long long time until i ran the numbers on edmunds.com

For many cars it pays to own, since the lease rates are jacked up, but infiniti gives some of the best deals ive ever seen in anything in their class. So leases really make sense for the g cars.

As for the addage that only suckers lease, well the price differential for me lease vs own was around 300 dollars a month, which i can afford no sweat. But if you throw that extra money in even a high yield savings acount, at the end of 3 years, i still come out with more money than "equity" than i cuold have built up if i had owned. Over 6 years, the length of the loan i was looking at, it came out to a wash. So at the end of the lease, i would have the money i would have had i bought the car and then sold it, without the hassle of selling.
Again this is unique to low interest (money factor) leases, which IFS is pouring on right now.
Be aware that the MF i quoted, .00113, comes out to an equivalent interest rate of 2.71. When you add that to the crazy residual they are giving, 58percent for 3 yrs, its really nutty. The acura dealer really didnt believe the numbers i was giving since it was so far off from his.
His argument was, "well we sell a car that doesnt need this kind of support from the factory"... oh well.

Look closely at the lease terms, examine the mf and residuals, some ppl think its too complicated and they mess with the numbers to screw you. There are plenty of resources online to do yer homework, edmunds.com is terrific for this.

Examine it closely and make your own decision. The acura, was a great deal, the sale price was great and if i had wanted that car i would buy it since the lease terms sucked. The leases numbers on 05 Infinitis are awesome, negotiate a good buy price and you can have yor car subsidized by IFS.

 

What you have to realize is that you dont "owe" them anything, you are renting for a term specified by the lease. If for some reason the lease was terminated, ie accident or you fall in love with the 07 g35, you are out of the money you put down, whether in fees/taxes/cap costs etc. If you get into an accident where the car is totalled, the insurance pays off infiniti, and everyon walks away, yer down payment, bye bye.

If you walk into the javits center in april, and the new 07 g car makes you cream your pants, you most likely could talk IFS into getting out of your lease and into a new infiniti. Again yer down payment goes bye bye.
I was gonna put money too, had some cash lying around and id figure id lower my monthly a bit, but everyone who had leased told me this was not the way to do it. Most had gotten out of leases a bit early when their own dealer had called to put them in a new one.

Leasing is a strange freaky world, whats expensive is cheap and what sounds right isnt.

 

I've purchased a lot of cars, and can still pay cash for the G35 if I want. But I still choose to lease it, for 2 reasons: 1) it'll contractually tie me up so I won't want to sell it to get another car in a year when the next best thing comes out. 2) I won't get the hassle of trying to sell the G35 or trying to haggle the trade-in price with the dealer. I absolutely hate having to do this.

One of my previous car got involved in an accident with $9000 of damages. The dealer checked carfax on that car, and the resale value went down the toilet. That's how I look at it - if I get just one accident and I lease, then it'll even out leasing vs buying.

 

Hahahaha...You actually think the Finance company going to "keep" the difference between the amount you "owe" and what the insurance paying for that car?...Yes it is what you "owe", you arent "renting" from them, if it was? can you walk into your dealer and return it and say I dont want to rent it anymore and you dont have any further financial respondiblty to it? call your leasing company (IFS?) and ask them how much you owe on your lease and see what they say...would they give you an amount or will they say nonono you dont owe us anything cus you are only renting form us? ...putting down payment reduces the amount you "owe" or what you are respondible for, it just done disappare into thin air.

 

Well I actually know ppl who have done just that, if you knew you gonna be at that place for certain length of time, why not put some money ahead of time to reduce their monthly rent?...I understand that you can better utilze the money some where else but that would depend on each individual's situation and mind set....

Its bad enough that you have more "fee"s on the lease and you want to make it even worse by adding interest to them?

Did you factor in the TAX consequences on your investment returns?

 

I never said you get a refund, thats the whole point.
Say on week 3 of yer lease, god forbid you got into an accident, and the car was totalled. Say you paid the tax and fees for the whole term of the lease upfront. That money is now gone. The insurance pays IFS, you get squat.

As far as getting out of the lease, my brother in law got a call from his own volkswagen dealer about getting into a new lease on a passat wagon. He was over a year away from the end of his current lease. Again if you paid for the taxes and fees for the whole lease term up front, but only used 2/3rds of that, you just tossed all that money away.

Please head over to Edmunds on the prices paid forums, all the mods as well as anyone who understands anything about leases will tell you to never put money down on the lease. The decision to put down fees really depend on the money factor you get, and on this inf lease, it was as close to nothing as possible.

 

of course i calculated the costs of incorporating the fees into the monthly payments. It divded out almost exactly, did i mention the Money factor was equivalent to 2.7 percent. Id finance that any time of the week.

The savings account i was calculating was based on the 4percent savings account at emigrant i just opened up. I think i'll be ok with the irs.

I worked over the numbers every which way to sunday, the money factor and residuals on the infiniti was too good to pass up.

As you say, its all situational, you can get ripped off leasing, but if you look closely at the numbers, there are some great deals out there.

 

Now does that work same on the a loan? if you didnt put a down payment? its going to be add into your loan or leasing amount, so if somthing happaned? you might have to pull some money out of your pocket to cover it(you owe more than car is worth) the finance company DO NOT keep the difference, they give it back to you.....bottom line is down payment dont just disappear into thin air...or do it?

Actually there are no fees that involed for the whole term, sales tax are base on monthly payment, and DMVs fee are for first year registration, all the other fees are one time deal, you rather add all of them into your leased amount? and pay interest on them? ok, if thats what you like to do it fine but I still dont see why put a down payment is such horrible idea.

 

So you telling me that you rather put your money into a saving account that earns you FOUR percent before TAX, than put some of it as down payment, and you rather paying 5.04% on the M/F?...
.

Now you say you did get 2.71% as M/F...ok lets do lil math, althought it isnt excat but some what close...if you pull 2k out of saving put as down payment, how much will lose?...2k earning at 4%, 80 bucks, minus say 35%tax(28 fed 7 state) you get 52 dollars, 2k as downpayment, 2k on 2.71%? is 54.2 dollars/yr so you actually paying 2.2 dollars to put them into your saving account! WOW nice saving...