Let me know what you think of this deal and if I omitted an important figure?
MSRP $46,130
Selling Price $43, 435
$340/mo
6k drive off lot cost (includes down + TT&L)
MF .00127
Residual 57%
Purchase Option $26,794.10
pls break this down…[20]
Need more detail, but deal on the surface looks bad. Discount way too small. Dealer is using cap cost reduction to present better monthly payment. You have thousands of dollars in negotiating to go to get to good deal territory. Remember, dealer will go for all the money on any initial offer. No reason for them not to.
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It’s not advisable to put anything down on a lease, especially $6K - because if the car gets totaled during the lease you will lose that $6K. I’ve sen these about 15% below MSRP, shoot for that
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Please review my 2016 Grand Cherokee in the forum but i believe you should have some sort of rebates. 15% off i have not seen these cars and i went to quite a few dealers, but at least 10% minimum before rebates it is doable. Depending on the state and tax rate looks like you had at least 3500 in cap cost reduction or you can add about 110 or so to the payment.
Oh in case it matters, the dealer is in Long Island NY
Drive off breakdown;
340.86 1st month
1963.18 Sales Tax (8.87)
3311.40 Cap cost reduction
299.00 Filing Fee
75.00 Title & Registration
10.00 Inspection Fee
12.50 Tire disposal Fee
- Rebates 4500
=== $6000 total due at lease signing
On the topic of a down payment and if you get into a crash that totals the car we’re planning on getting gap insurance.
We went back and forth 4 times and this was their last. I also got offers from 3 different dealerships earlier in the day and this was the best?!
By having GAP insurance, that’s even more reason for you to NOT put a down payment.
?
Isn’t that what you buy from the dealership to cover this potential downfall? I heard approx $20-25/mo.
GAP insurance pays off the leasing company (if your insurance payout does not cover entire balance). It does not get any of your money back.
PS: it can be much cheaper to get GAP coverage from your auto insurer.
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I looked into that and Geico doesn’t offer.
Is there anything I can do to cover this downside?
You could buy it at the dealer. However, like most things in the Finance manager’s office, it is grossly overpriced.
I did some rough math and the probability is something like 0.4%…does that even need to be insured?
If you haven’t already done the deal, the easiest way would be to just not put down the $3,300.
Sure, but we have the cash in the bank to put down, and more if we want to, but we’d like the monthly to be around $350. You’re going to pay it one way or the other, 0 down and higher monthly VS lots down and lower monthly, right?
In fact good topic. Isn’t the total price paid slightly MORE if you put $0 down, vs putting a couple thousand down?
Back to the totaled Jeep topic, is the only way to not lose the down payment if the car it totaled to put $0 down? From above it sounds like GAP insurance isn’t what I’ve read online? Perhaps what I get for believing something I read on the inter-web. HA!
Does this matter one way or the other if the accident is your or someone elses fault?
My Jeep lease has gap insurance based on the contract. Most lease companies will include that in their lease so you could be ok regarding GAP. However, it only cobers the bank and if something happens to the car in a month, most likely you lose the 3300. I like your deal as it seems there is no acquisition fee unless its covered by the rebates. Mine was 895. Again, you could do better. Which dealer in LI? I can recommend my salesman if you want to give it a try.
Hi Goff, this article explains 1 payment or pre-paid leases where you pay the entire lease up front (I think GM was pretty popular for this) but a lot of the same information would apply to putting down a hefty down payment. http://www.leaseguide.com/articles/prepaid-lease/
I’m not an expert on this, but I’m sure it does.
Many reasons not to put money down on a lease of which totaling a car is at the bottom (but is another factor supporting the decision not to). Why tie up cash when you can achieve better returns out in the world? Assume you took a lease out in January 2014 and it ended January 31, 2017, and you put down $5,000. The S&P 500 has returned 28% over that period. You would have left a lot of money on the table - $1,400. There is simply zero reason to give them the money. The I want a lower payment argument is not justifiable - it’s mental gymnastics. You are simply better off having control over the money.
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…unless this $5K burn a hole in your pocket and you decide to blow it on some toys. Then you left with paying an extra ~140/mo for the next 3 years. Also - knowing that your payments will be lower by a significant amount over the next few years IS having better control over your finances. But you are right, in general.