Honda / Hyundai — D&M Leasing

Ask the Hackrs
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Hey everyone,

Living in Dallas. I have always bought used cars for cash (4 cars so far), so this is my first time looking to finance or lease a vehicle.

My credit score isn’t great, but not the worst. Transunion reports it to be 693, but when a Honda dealership ran my credit, it came back at 667.

Honda was willing to offer me the 2022 Civic Sport time for $446/mo with $1,000 down for 10k/36, but this didn’t seem like a good deal.

D&M Leasing said they’d be able to get me in a Hyundai 2019 SEL with 14k miles for around $375/mo and $1,000 down. The problem is, they said it’s a 5-year lease agreement with the option to get out early around 3.5 years if the car isn’t over depreciated at that point.

Something just doesn’t feel right about working with them, but with this being my first time, I’m just not certain why or what it is. I would say it’s because I don’t know what they’re saying car is currently valued at, what they’re saying the residual would be, what the interest rate is yet, etc.

When I plug in the numbers, $375 with $1,000 down is $14,500 just over the first 3 years for a 2019 model, not to mention if I have to keep the car for longer and am unable to get out early. If I end up having this car for the 5 year term, I would be paying $23,500 and have been in a 2019 and the warranty expires in 2024 in 3 years.

I have put down a $500 deposit with D&M Leasing, but I can’t shake the feeling that I made the wrong decision in doing so. No contracts or loans have been signed yet though and the car has not been received.

Should I even be trying to pursue leasing a vehicle right now having not financed or leased a car in the past and with my current credit? Is D&M a reputable company, or should I just stick with standard dealers?

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Welcome to LH. Thanks for posting before signing a deal. Please ask all your questions and feel good about everything before you sign.

That said, literally the worst time in history to lease or buy a car, new (especially) or used.

This car just came out, so even in normal times will not lease well. Honda as a brand tends not to lease well (usually, not always) - most cases better to buy. Also keep in mind that MSRP doesn’t really relate to lease payment.

You really want to be north of 720 without a co-signer for Tier 1.

The best place to start is

Please read links in there such as “how to calculate payments” and other helpful articles.

It might seem like a lot but TBH there are fewer <60 minute exercises which will save you so much time, money and anxiety over your driving lifetime.

It may also save you (after your negotiations with LH input) inside the finance office where no one can from the internet can really help you.

Remember, it’s almost impossible to reverse-engineer the math starting from the output (monthly payment) and figure out if it’s a good deal. Start at the beginning.

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This SCREAMS red flags to me…

Edit: I knew I remembered that name

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Thank you for the helpful and prompt reply, John. I will definitely be reading up more and learning as much as I can in this process.

Would you advise I wait until I can build my credit to tier 1 number before leasing a vehicle? The MF Honda quoted me was 0.00188 which comes out to 4.512% APR equivalent.

I saw in one of the articles that there was a list for Toyota Financial Services and what rates they charge for different credit tiers, 1-3. Is there a Honda reference for this as well? I tried searching online but wasn’t able to come up with anything for a point of reference yet.

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Dear god, what a nightmare. Thank you for the helpful link.

I will be requesting my deposit back. Even if it’s lost forever (should be able to dispute it worst case scenario as it was on a credit card), at least it was only $500 instead of a signed contract.

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Others may disagree, there is no lease I’d sign today at that rate - cost of money is way too high relative to other interest rates. It’s probably marked up, but a 2022 Civic is likely higher than a 2021 Civic or Accord right now, and you have to understand all the inputs and how they move (not just MF). Are you really enamored with the 22 Civic or are you looking for a lease deal and you think that’s your budget?

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Thanks for the insight.

As for having to have the Civic, I initially thought it was nice car at its price point, but I don’t have to have it. It was just my first option I started exploring more seriously.

I would prefer a simple sedan with preferably good fuel economy and keeping costs down as much as possible, but I do not have to have a Civic.

I watched the video on the leasehackr calculator and on the inputs that go into it to try to better understand everything. Will keep watching, reading, researching, and learning.

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Kia k5 has popped up a few times as having decent prices.

In addition to watching the videos, we always recommend the following method before you ever contact a dealership. If you do all of the work up front, you’ll have a stress free dealer experience and set yourself for success.

  1. Read Leasing 101 (Blog | LEASEHACKR) to understand how to calculate a lease payment and the variables. Monthly payment is an output, not an input!!
  2. Pick a specific vehicle that you want to target
  3. Gather the current MF, RV and incentives from Edmunds forums for your zip code
  4. Research the LH marketplace and other deals that have been made recently on your vehicle - what was their pre-incentive discount? How did their lease terms differ?
  5. Plug your numbers into the LH calculator (CALCULATOR | LEASEHACKR), and use a pre-incentive discount similar to what you have seen
  6. Create a target deal, this is what you’re trying to negotiate to. You can try different terms, selling price discount, etc. and see how your monthly payment is affected. It is also possible that different trims of your vehicle may have different MF and RV (i.e. this is very common with GM), so make sure that you look into that. Come up with a set of inputs that give you the output that you want - your desired monthly payment.

With a target price determined, you now have a deal to pursue and compare dealer offers against. More importantly, you have a solid foundation to work from.

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Thank you for the help, tremendously appreciated.

Is it recommended to email every dealership in your area for a particular vehicle up to a certain mile radius with an offer once you’ve done the homework?

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You could also look into a Hyundai lease. I believe it’s the same MF for Tier 1-3. But hey, at least you weren’t quoted a sub-prime 20% APR :man_shrugging:

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Personally, I do one at a time, because when I make an offer, I end it with “if you accept my offer, I can be there in X number of hours to take delivery.” Any offer should be serious and immediately actionable.

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Good ole’ predatory lessor, does it again! Wow! D&M is just trash, just letting you know.

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Dallas people all know DM leasing is BS, do not sign even you cant get back deposit.

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