MSRP: $64,095
Selling price. $56,500 (11.85% discount)
Incentive: $1.500 lease cash (was not eligible for Costco)
Terms: 42 months @ 10k / year
Residual: 51%
MF: .00135.(buy is .00073 and I am a tier 1 credit score)
DAS: Taxes, fees, and first month
Payment: $665
Region: TX
I was on the fence about purchasing vs. leasing. I went ahead with the lease for the optionality. With the unfavorable money factor, if I pay cash for the car at the end of the lease the math works out as if I just financed for ~48 months.
I have leased cars in the past (both with Infiniti and Lexus). In those situations, my MF was always around close to nothing and I always chalked that up to good credit and never thought twice about it. I’m wondering if in this situation the dealer was raking me on the backend to recoup some of that MSRP discount. Life lesson learned. In a weird way, I am trying to use the purchase at the end to explain away my blunder.
Do you think this was a decent deal? MF killed me, so I know it can’t be a great deal. Appreciate the feedback and criticism.
Agreed. That’s why I am hesitant to label it as average or fair deal at best. If that’s so, and while I’m not thrilled I left money on the table, I can make peace and move on. I’ll just be sure to turn the screws to them next time if they want my business.
What did you find for a target pre-incentive discount during researching? I haven’t been following Q7 prices, but know that’s not that far off typical Audi targets.
What I got appears to be at the 75th percentile I think, which is the only thing keeping myself from going nuts. I put myself in a very poor position and was underprepared. I was literally waiting for my Uber when the sales guy called me back in. I was originally interested in a used vehicle, but we started talking about a new Q7. Financing was always the topic of record, at which time I reverted and got cold feet and opted for a lease.
I think this where they thought they could claw back some of their giveback and mark up the MF. Me and my naivety didn’t think anything of it due to my stellar credit. I wrongly assumed that the tier 1 non-marked up MF would be applied similar to the loans APRs I was seeing. Poor mistake.
This is why I think if I treat it as a quasi financing deal, the numbers still work as I can just pay for the car in cash at the end of the lease and it will balance itself all out.
My guess is what you’ll find is that this is probably a better than average deal for the general public, but probably a bit short of what could have been done. That’s ok, live and learn. Nothing to beat yourself up over, just use it as motivation to do more homework next time.
There’s nothing wrong with a marked up mf, as long as you have a commensurate discount to go with it. It sounds like you had at least a good chunk of that. Hell, I picked up an Audi over the weekend and offered to the dealer to have them mark up the MF. I’d rather have a marked up MF and a bigger discount any day of the week.
