Hey guys trying to lease a car for my mom, her old camry is finally dying out. She likes the Accord. I am completely new to leases, I have done some research and seems Accord does not lease well…still wanted your opinion on this deal, totally open to any suggestions:
MSRP 24,445
With Dealer accessories: 25,263
Due at signing: $2400
Monthly lease payment: $207
From what I read online (not sure about accuracy):
Residual value: 60%
Money factor with good credit: 0.0011 (my credit score is about 800)
For a car that hold its value really well, I feel I should be able to negotiate it lower…especially since I am buying the 2018 model rather than 2019.
If they can do $255 a month with just first months payment down I’d say that’s not a bad deal. If the 2019s are already out I’d see if you can get them down under $250 a month without putting anything down.
Remember putting money down is money that’s gone. If you reck that car a month later and your insurance pays out, it will only pay out how much is left on the car. So the $2400 down is lost. I always go with just first months payment down at signing and have the tax, title and transfer fees rolled into the monthly payment. If the dealer won’t budge I’d take my business elsewhere.
OP didn’t even provide dealer discount to establish whether or not this is a good deal. What’s your basis for arriving at this conclusion then suggest to walk if they won’t arrive at those numbers?
I didn’t get a “selling price” I will get that from them. Since I know I will be leasing only for the 36 months and definitely not buying it I was more concerned with what I would be paying over the 3 years.
With the above deal I would be paying $9645 for the 36 months on a car with MSRP of 24,445.
I will check with the dealer today and see what the actual selling price he is offering.
I make every attempt to dispel any myth or belief that the “selling price” doesn’t matter on leases just because you’re turning it back in. It’s very pervasive in modern car selling culture never to mention a selling price… but if you lease; the monthly payment is structured around the difference between the residual and selling price. You need those numbers in order to work the best monthly payment.
Look at it this way… if the selling price didn’t matter on a lease, then why do dealers ask for money down?
This is an issue not just for leases but in all car buying. Dealers never want to talk sales price or OTD price, just monthly payments. Big numbers make people uncomfortable. Also, sometime a buyer throws out a monthly number that allows a dealer to sell the car at MSRP with a marked up finance rate.
I recently bought an Accord (long story - mostly wife’s preference and VA’s horrible taxes led to not taking on a second lease). But every dealership only wanted to talk payments and not sale price or OTD price. It took multiple emails and phone calls to drill down to the OTD price and convince them I wasn’t concerned about the monthly payment. I get some buyers have less financial flexibility and have a strict monthly budget. These folks should use lease calc or car finance calc and work backwards. Figure out what sale price they need to meet their budget and shoot for that.
What I don’t understand is why people don’t use a calculator before car shopping… If people are as concerned about monthly payments, then they would need to know that they could only afford X amount per month based on Y selling price of the car…
If my budget is 300 a month, then based on my (theoretical) credit with a 2% APR, then the most car loan I can afford is about 18,500 which means that I need to know the taxes, titling fees, price of the car to get to 18,5k… I can’t just swing for the fences and say “That 40k dollar car, I want it for 300 a month.”
Well this lease is a gift for my mom. The proposed offer is within budget but I wanted to make sure I am getting a fair deal…doesn’t have to be the “best” deal. That is main question I had, but looks like more information is required.
I always ask for OTD for purchasing, asking for anything else just leads to them adding the difference somewhere else. But I am completely new to the leasing option. I wanted to try this out and take this opportunity to learn. Maybe I will opt for a lease for my next car.
I think this community is great as I read through the posts.
Again thank for your advice. I will get clearer numbers and post here.
I don’t think OTD is a great yard stick if you’re looking to avoid “add ons”. The best way is to always get a full break down, double check everything and do the math yourself - whether it’s a lease or a finance.
This poster does this all the time with suggesting random numbers and telling the OP to walk if they can’t do this. No basis in fact or numbers, just pure randomness. This poster also has no idea how leases work considering some past comments stating the dealer added $1000+ to the buyout price to lower the lease price
1% of the sticker price for the vehicle. If I’m doing something wrong I would appreciate it to have some feedback and not receive condescending replies.
TheHellion, 1% is not always achieveable. This is why a lot of hackrs (that I’ve seen so far) do not like the 1% rule, because it’s not realistic for many cars out there due to a lot of factors such as lack of lease support from the manufacturer, bad money factors, non usage of MSDs, and poor dealer discounts.
Honda Accords happen to fall into some of those categories and I have not seen a lot of the better Accord trims leasing at 1% of sticker, maybe the LX or even the Honda Clarity are leasing at or below 1%.
Using 1% as a rigid rule will definitely get you into trouble here. For example, I haven’t seen any Range Rovers at 1%.
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