My dealership says they’ll take $12k for my trade-in and apply it to the lease. But how is this different from money down for the lease, which isn’t recommended?
Or is it different because dealers would offer less if it was an actual trade-in? Or should I just try to finance with this trade-in amount?
It’s not different. Take the equity as a check and deposit it into your bank account.
and then use it as a down payment for a lease? at what amount should i just be trying to finance with it?
No. Do not use all of it for a down payment, that would be no different than the dealer just applying it directly.
Or just tell the dealer to use use $1k of your trade equity to cover DAS (or however much to cover up fronts) and have them cut you a check for the other $11k.
If the car leases well, then lease it. If it leases like crap, then finance it. Don’t let the fact that you have $12k in equity sway that decision.
If you deem it a better finance candidate then it’s really a personal decision of whether you want to use some or all of that $12k as a down payment based on the car, rates, personal situation, etc.
Depends on the money factor on the new lease.
Compare total cost with and without the down payment, and balance that against the probability of a total loss and your risk tolerance.
Note the amount that’s “at risk” is never 100% of the down payment, and it decreases every month until it’s zero in the final month.
Same approach whether it’s cash in the bank or equity in a car.
What my dealer did with my ‘trade in’ is mark up the MF to cover any loss in equity he was going to suffer.