car lease question. yay or nay? (calling The Financial Lounge!)

[BostonB6]

Actually, the way they structured the deal, the OP only makes 35 payments as lease payments are not in arrears like loan payments and the dealer made the first payment.

[dh71704]

Nice new car. My wife wants a Sienna and I am trying to talk her into the oddy. Is you paper work dated in august? And what is a rent fee? I know nothing about leases, so is a rent fee a common charge?

[dieselraver]

Nice new car. My wife wants a Sienna and I am trying to talk her into the oddy. Is you paper work dated in august? And what is a rent fee? I know nothing about leases, so is a rent fee a common charge?

yeah i noticed the 8/27 date also, but that has no bearing on the deal at hand. the day we take delivery of the vehicle is when the lease begins so no biggie. also the rent fee is basically your finance fee. typically its your (Net Cap Cost + residual Value) x Money Factor


i highly encourage you to drive both. the dynamics are night and day. Sienna is squishy and not very communicative, think a firmer boat of a caddy,

the odyssey is more of a drivers van.

[Beanboy]

Tax savings that dealer mentioned probably deal with you only pay taxes on the amount leased, not on the full amount of the purchase price as you would on a financed car. That's the case with most states at least.

Only been through the leasing process once, and that was helping a friend out. Worked in her case. Needed very reliable transportation when starting a new career, and had low amount of cash savings.

[BostonB6]

Tax savings that dealer mentioned probably deal with you only pay taxes on the amount leased, not on the full amount of the purchase price as you would on a financed car. That's the case with most states at least.

Only been through the leasing process once, and that was helping a friend out. Worked in her case. Needed very reliable transportation when starting a new career, and had low amount of cash savings.

Yeah but, at least in MA, you end up paying sales tax on the interest too when you lease. One of the small pitfalls of leasing.

[dh71704]

In Illinois if you buy a 22k car and the dealer gives you 20k for a trade in you take the selling price minus the trade in price(22k-20k=2k) and that is what you pay taxes on rather than the full selling price. That could be what the dealer meant by tax savings.

[dieselraver]

Yeah but, at least in MA, you end up paying sales tax on the interest too when you lease. One of the small pitfalls of leasing.

i am buying the van from Massachusetts but I don't pay the sales tax there, i pay my state tax (NYS @ 8.875%) does it make a difference?

[PsyberVW]

Incorrect. You can easily sell a car you're financing and get a new one. It's nearly impossible to break a lease unless you want to line their pockets with your money.

As far as ownership goes, you still own the car, even if making payments. The bank has a lien on it, but you are free to dispose of it if you want to. You own nothing if you lease.

I'll have to take exception to this. You can sell a leased car at any time, just as you could a car with a regular note/lien. I've done it twice on cars that were popular enough to leave me without negative equity. It all depends on your contract- but look at it this way:

The bank is buying the car and renting it to you. Even though you may be paying 40% of the purchase price, you still owe the other 60% - it's just that you're paying it back by giving the car back. If you can find someone to buy the car before the lease term expires- you're simply paying that 100% now.

The only thing you can't do, is stop making the payments /try to turn the car in (terminate) early. As expected in any contract, would have some cost associated to it, as it should.

[dieselraver]

I'll have to take exception to this. You can sell a leased car at any time, just as you could a car with a regular note/lien. I've done it twice on cars that were popular enough to leave me without negative equity. It all depends on your contract- but look at it this way:

The bank is buying the car and renting it to you. Even though you may be paying 40% of the purchase price, you still owe the other 60% - it's just that you're paying it back by giving the car back. If you can find someone to buy the car before the lease term expires- you're simply paying that 100% now.

The only thing you can't do, is stop making the payments /try to turn the car in (terminate) early. As expected in any contract, would have some cost associated to it, as it should.

Yep. Just like if I wanted to buy a new car. The dealer can call up (in my case) Honda finance and get a payoff quote much like a car being financed. I'm tempted to buy the odyssey at the end of 3 years. The buyout is only 18,000.00

[Chiropractor JW]

Our buyout is about the same. I'll probably take it to Carmax, might be able to make a small profit, and use that money towards a down payment on a new one. Or use the money for hookers and blow.

[IgorRGTI]

Yep. Just like if I wanted to buy a new car. The dealer can call up (in my case) Honda finance and get a payoff quote much like a car being financed. I'm tempted to buy the odyssey at the end of 3 years. The buyout is only 18,000.00

If you're going to buy out the Odyssey at the end, or even sell it during the lease, then what is the point of doing the 15k miles? Why not do 10k miles / year and bump up your residual percentage? Lower the payment, and the outcome is the same either way.

[mike02467]

If you're going to buy out the Odyssey at the end, or even sell it during the lease, then what is the point of doing the 15k miles? Why not do 10k miles / year and bump up your residual percentage? Lower the payment, and the outcome is the same either way.

Because then you'd be over the mileage limit when you try and do a payout, and will have to pay assloads of fee's? Or does that only apply to end of lease turn in? anybody know the details on this?

[IgorRGTI]

Because then you'd be over the mileage limit when you try and do a payout, and will have to pay assloads of fee's? Or does that only apply to end of lease turn in? anybody know the details on this?

If you're buying it out, why would they care about the mileage? In additional, having done buyouts and sold lease cars mileage was never a factor.

That only applies at lease turn in. Even then, a lot of times if you're leasing a car from the same manufacturer they will waive over mileage fees.

Additionally the only time mileage matters in a lease buy out or trade in is in the case of a bank not financing you because the car has over 100k miles, or you might have a higher APR in an event such as that.

[dieselraver]

Because then you'd be over the mileage limit when you try and do a payout, and will have to pay assloads of fee's? Or does that only apply to end of lease turn in? anybody know the details on this?

the fee only applies if you turn it in with overage. if you keep the car or buy it out, sell it to another dealer (tradein) then you don't have to worry about being over on the mileage. same goes for if you have positive equity in the vehicle, lets take my odyssey for example, end of lease purchase price is about $18,000.00 if the Van is worth $27,000 i can go over in miles if I "trade-in" the vehicle 2-3 months before lease end. most of the time a dealership will "buy" the vehicle and relist it for more than what they paid for it, you are happy b/c the mile overage is forgiven, they are happy b/c they bought a car at wholesale and can easily sell it for $18,500-$27,000 (just making up numbers)

however if you turn it in with 60,000 miles (with a 45,000 allowance) then everyone loses out.

[dieselraver]

If you're going to buy out the Odyssey at the end, or even sell it during the lease, then what is the point of doing the 15k miles? Why not do 10k miles / year and bump up your residual percentage? Lower the payment, and the outcome is the same either way.

i didn't say 100% i was going to, if i have a family member (cousin with a baby) who wants it i will, if not i'll probably give it back, negotiate my monthly down to $366 again and walk away with a 2015 odyssey.

however in 3 years if the van is worth 28k, and wholesale it goes for $22+ i'd buy it and flip it (with 5k in my pocket) or trade it in to a dealership (let them make the payoff and use the positive equity to subsidize another lease)

[IgorRGTI]

i didn't say 100% i was going to, if i have a family member (cousin with a baby) who wants it i will, if not i'll probably give it back, negotiate my monthly down to $366 again and walk away with a 2015 odyssey.

however in 3 years if the van is worth 28k, and wholesale it goes for $22+ i'd buy it and flip it (with 5k in my pocket) or trade it in to a dealership (let them make the payoff and use the positive equity to subsidize another lease)

I know, but given your current track record with leases, I figure you will definitely either buy it out, or trade it in early .

[Chiropractor JW]

Worth 28 grand in 3 years? How???

[dieselraver]

Worth 28 grand in 3 years? How???

i'm just shooting numbers

although KBB for 2009 Odyssey EX-L with 45k miles Mfgr trade in

• Excellent
  $19,679
• Very Good
  $19,279
• Good
  $18,529
• Fair
  $16,479

private party

• Excellent
  $22,189
• Very Good
  $21,589
• Good
  $20,989
• Fair
  $19,039

[BostonB6]

KBB prices are very over-inflated. Edmunds average condition is a much fairer representation of what you would get in trade or sale.

[IgorRGTI]

KBB prices are very over-inflated. Edmunds average condition is a much fairer representation of what you would get in trade or sale.

This.

Even then often times Edmunds can/will be higher then the wholesale price which is generally what most dealers will give on a trade in.

[dieselraver]

sigh, so we have a hiccup with the paperwork, they screwed up the NYS tax rate (used 8.6% instead of 8.875%) and didn't include a fee for the plating company (3rd party) to get paid. can i have them keep the existing contract and just pay $300.00 (total cost) out of pocket, or will they need to redraft the leasing agreement to include those charges?

[IgorRGTI]

sigh, so we have a hiccup with the paperwork, they screwed up the NYS tax rate (used 8.6% instead of 8.875%) and didn't include a fee for the plating company (3rd party) to get paid. can i have them keep the existing contract and just pay $300.00 (total cost) out of pocket, or will they need to redraft the leasing agreement to include those charges?

I would rather them redo the contract so it's all there in writing and spelled out. Did you check it closer for another other hiccups?

[dieselraver]

I would rather them redo the contract so it's all there in writing and spelled out. Did you check it closer for another other hiccups?

everything is legit, but the hiccup is on their end, they screwed up the tax rate which means they will underpay the state the tax and risk having an accounting issue. the plating company i guess needs to be paid (on paper)

i don't know its really baffling. dealing with an out of state dealer is difficult as they have only sold 1 car out of state before and I am the second round guinea pig. for the potential savings and the great customer service im willing to accept these issues.

[caj1]

sigh, so we have a hiccup with the paperwork, they screwed up the NYS tax rate (used 8.6% instead of 8.875%) and didn't include a fee for the plating company (3rd party) to get paid. can i have them keep the existing contract and just pay $300.00 (total cost) out of pocket, or will they need to redraft the leasing agreement to include those charges?

8/27 lease date? Another reason to redo the paperwork with the correct information.

[dieselraver]

8/27 lease date? Another reason to redo the paperwork with the correct information.

Most likely this is attributed to The dealer trying to secure whatever incentives are available for the month of August.

[dieselraver]

.... and now my car sales guy quit!!! the plot thickens. a guy he trusts and has been there a while has all my info and will be helping me with the same deal...... waiting for his phone call sigh

[caj1]

Most likely this is attributed to The dealer trying to secure whatever incentives are available for the month of August.

Sounds fishy.. why not the 31st? If it's too good to be true it usually is..

[dieselraver]

Sounds fishy.. why not the 31st? If it's too good to be true it usually is..

not really, the price is highly competitive, but i wouldn't call it "too good to be true"

[dieselraver]

and this gets better!!

so my new sales guy is no longer helping me, the original guy that helped me was the internet sales guy, he basically got paid for bringing leads into the dealership, well he finally got bumped up to sales guy and now he took over my deal!! Thank God i have someone who is finally competent! I may actually get this van! i've never had so much trouble trying to buy a vehicle. usually dealerships throw the keys at me

[Chiropractor JW]

I've never heard of such difficulty buying a vehicle. It was like 2 hours between the time we went to the dealership and when the mrs. was driving it home.

[dieselraver]

I've never heard of such difficulty buying a vehicle. It was like 2 hours between the time we went to the dealership and when the mrs. was driving it home.

Seriously!!! I called the finance guy today b/c i had a feeling he was stopping this from going forward, he was like, "are you going to bring your car in for service here?" (they are 180 miles away) I said of course (not lying) my sister and close family live near by so it would give me an excuse to come visit them.

I am a firm believer in supporting the dealership that gives you a deal on the car even if it means traveling great distances (my Subaru was purchased out in riverhead Long Island about 80 miles each way and i religiously go to them)

So I also tack on that I need a Civic or Accord for cheap, my mother is going to need a car come march and yada yada (all truths)

All said and done, he says I will have this car plated by the end of the month 100%

I really am not in a rush to buy the van but in all honesty not knowing what was going on sort of drove me a bit nuts. I even said to them, usually its the dealership pushing me to buy the car, not the buyer pushing the dealership to sell it.

I'll let TCL know in 2 weeks whether I have this van or not.

Someone in NJ got a deal on a EX-L with navi almost at the same capcost as mine.... except he traded in a leased 2009 MDX and got the taxes and fees paid in full with the 3k equity.... (not really a good deal if you ask me!)

[Sporin]

Way too much runaround, I honestly wish you the best (not being a hater) but I give this less then a 50-50 shot of you getting that van. I'd start working on a Plan B if I was you.

[IgorRGTI]

Way too much runaround, I honestly wish you the best (not being a hater) but I give this less then a 50-50 shot of you getting that van. I'd start working on a Plan B if I was you.

Agreed.

If this was an easy sale for them, they would have no reason to drag their ass.

[Chiropractor JW]

By the end of the month??? Wtf???

[Sporin]

This is why I only buy local and off the lot.