Looking to lease an Accord, having been very tempted by the great deals I’ve been reading about on this forum. After going a bit back and forth with my dealer, this is what he presented me, but I feel this is still a bit too high. What would you guys recommend doing to get this lower, and by how much should I target to bring it down? Also, would it be better to consider a 1.5T Touring instead perhaps?
2018 Honda Accord EX-L 1.5T
**MSRP: $30,865 (dealer has aftermarket options installed such as bodyside molding, security, and tint…I know I hate this, but couldn’t work my way out of it )
**Selling Price: $26,300
**Additions to Cap Cost: $1,191.20 (includes dealer handling, DMV, etc)
**Cap Cost Reduction: $2,549.41
**Rebate: $1550 (includes $750 loyalty)
**Down Payment: $1,500
**Monthly Payment: $290.26 (including tax)
**Cash Due at Signing: $1,790.26 (down + first month)
If you can’t work your way out of BS add ons, find a different dealer. This isn’t a Civic Type-R. Also I don’t believe that add ons affect the MSRP (residual) on Honda’s since they are dealer added accessories, I think they just affect selling price.
The residual factor I computed is 54%. So, it appears that the residual is based on the 30865 MSRP and, like @chrishs2000 said, the adds are apparently fully residualized as they probably conform to Honda OEM. I would get an itemization of the 1191.20 capped fees. It likely includes Honda’s 595 acq fee. However, you’re paying a HUGE 589 doc fee upfront. So, I have no idea what you mean by a dealer handling fee being included in the 1191.20. Also, what is your sales tax rate? The 22.13 monthly sales tax is very strange… 22.13/268.13 = 8.2534591%. I’m assuming all capped amounts totaling 1191.20 are taxable yielding a taxable payment (i.e., base payment) of 268.13 which is exactly what I get. Nowhere in my calculations do I apply the 1550 rebate. Here are my inputs and calculations…
So, the only way that the 1550 rebate is applied is upfront. The lease worksheet cuts off the total due at lease signing. Also, IF your sales tax rate is 8.25%, then how does the dealer arrive at 213.01 ( 8.25% x 2549.41 = 210.33. Also, where is the 1550 rebate tax assuming it’s taxable? You need to post the entire dealer lease worksheet and as much info as you have (sales tax rate) so we can discuss this intelligently.
Thank you so much for all the info! Completely agree about the add ons being used toward residual (I’m going to talk with the dealer about that). Dealer handling fee is a thing in Colorado where dealers get to tack on a fixed additional profit to each car sale, and can’t legally remove it (has to be the same for every customer). Sales tax you calculated is dead on for what it is for my address.
This is pretty much the worksheet the dealer gave me. I know it has A LOT of gray in there, and is not very transparent. I’m going to try to get more info today, and hopefully that should get to a much better bottom line!
Once again, thank you so much! This is my first time posting on this forum, and I really appreciate all the help from you guys.
Thanks! One thing does concern me and that’s putting 1500 down (cap reduction). I wouldn’t do it for three (3) reasons…
(1) If OP totals his Honda, GAP will cover the difference (i.e. gap) between the lease balance and the (ACV- actual cash value less your deductible). However, money down lowers the lease balance and, hence, lowers the gap between the balance owed and the ACV. You risk losing part or all of your down payment in the event of a total loss.
(2) The effective interest rate is about 2.2%. OP is better off using that money for other “better-suited” purposes. If too high a payment bothers him, he should keep the money in the bank and use it to subsidize his lease payments. He’ll be better off doing so.
(3) A car is a depreciating asset. The depreciation in the first few years is greater than the amount of book depreciation in the lease which is analogous to principle payments in a loan. Essentially, OP is throwing good money after bad.
But some dealers just don’t want to share the lease worksheet until the last moment. All they want is to know what monthly/DAS I want to pay. How to persuade sales guys to show that lease worksheet.
Yesterday I argued with one dealer because his sales price and monthly wasn’t matching as per Leashackr calculator. Thanks to this forum and informed people like you guys I just walked out.
That’s exactly right…that’s the problem with car salespeople…there isn’t much transparency, they never want to share the numbers and if they do they aren’t always accurate or fully there. I could have sworn the sale price on my car changed the day I saw the actual a contract to the numbers he had shown me on the computer screen days prior. And of course if you ask any questions related to the numbers more than two times they start to get heated. …one dealership wouldn’t share the incentives, he said that it wasn’t customer information, I said how come I can see all that information online and have all the information at my disposal, I knew what some of the incentives were but wanted to see if he would share what he knew on his end. …the only number I asked the dealerships that continued to come in accurate with was the money factor. And last but not least how come every dealership claims to be losing money on each lease they sign. …I hear this constantly when they run the numbers and say that hey I’m practically giving this car away…stop it … all false . They make money on each sell even if you are getting the best deal!
The best way to persuade a dealer is to threaten to go to another dealer. Transparency is an absolute must! You have to be nice but very firm. Knowledge = Confidence. I tell them that in order for me to be able to craft a lease proposal, I need to collect data. Among the pieces of data I need is their lease worksheet to ensure that we are on the same page. For example, their base money factor and residual should match mine. I carefully scrutinize the dealer’s worksheet to ensure that it’s accurate. Every one of their calculated numbers should match mine. When a dealer receives my emailed lease proposal, they immediately know that they’re dealing with someone that’s very knowledgeable me and is likely the reason why I’m often referred to the sales manager. Floor sales people just don’t want to deal with me. Honestly, in the nearly 40 years that I’ve been negotiating leases, only two dealers refused to give me their lease worksheet; one in Florida and the other in NY. I simply walked away.
You hit the nail squarely! Your experience is the reason why it is soooo important to create a lease proposal. When negotiations have concluded and, I’m ready to sign, I always create a final proposal that they must sign indicating that they agree with all my numbers. They email me the signed proposal together with the completed lease agreement. I compare all the numbers. If they match, I arrange an appointment to come in and sign documents. No mess, no fuss… won and done! Boom!
For a novice like me, is Leashackr calculator sufficient tool to create and compare lease proposals? I don’t think I can play with numbers the way you do.
How do you get around the tactic that they use when saying “you need to come in to receive the best price”. Very often I have seen that they provide their best price in person and never over email or telephone.
you need to compute ‘your’ best offer based on the info you’ve gained here. Shop multiple dealers and see who will accept it. End of year is here and they want to move units to make sales quotas.
Leasehackr’s calculator is set up to handle typical leases in most states. There are exceptions where leasehackr falls short in such states as Illinois and NY where tax calculations is an issue. It’s an easy programming fix but, apparently, nothing has been done to address the issue perhaps because few people know how to compute Illinois and NY taxes. Another area where leasehackr falls short is in those instances where customers desire to capitalize the first payment (and other fees) because his/her effective lease interest rate is extremely low and they would prefer to conserve their cash for other more opportunistic and cost-saving uses. For example, suppose you have two credit cards with large balances. One card has a 27% APR while the other has a 13% APR. Which one of the two are you likely to throw money at each month?
Regarding sell price, I have never encountered the situation where I was told to come in to get a better price. I think by that point, they know that they can’t bullshit me as I’m very much in control of the deal. I usually start low on sell price after researching pricing using marketing data supply/demand and observing what others have paid using edmunds and leasehackr as resources. I’ll also look at Truecar but, you can’t place too much credence on truecar as I think (not sure) they are owned/run by a consortium of dealerships.
Wow, thats some valuable info. I am from NJ so looks like the Leasehackr calculator should work fine for me as reference to compare offers.
I totally agree with your views on Truecar. All these pricing websites like KBB, Truecar etc are too much favored towards dealers than buyers. Very handful forums like this one and Edmunds are the only resources I found impartial.
)
