An Audi dealer in Dallas TX has offered me the following deal:
Audi A4 Premium with NO extra packages:
The numbers that dealer presented to me -
MSRP: $37,400 + Destination Charge: $995 = Total Price: $38,395
There are taxes / some more fees over this price as below -
This is what I have negotiated to till now - I pay $3,500 at signing I pay 367/month 36 month lease 12k miles/year
He is yet to tell me the RV and the MF
One thing I did understand is that we should not pay a big amount at signing. But, that seemed to help me get a good overall “out of pocket” (i.e. 36 x 367 + 3500)
Should I go ahead with this or not?
Any and every suggestion is appreciated!
Audis don’t lease well, but that discount is pathetic. You should aim for at least 10% off, so closer to $4000 discount. The extra $700 for window tint and nitrogen is a joke. Get that wiped out.
Your DAS is pretty high also. Audi MF is usually high so if you’re gonna put money DAS to avoid some interest, don’t exceed like $1500 or so.
It’d also help to get the MF to see if it’s marked up. RV is set by the bank and non negotiable.
All rolled in your monthly payment should be closer to $400 (I have found that Audis usually can hit about 1.1% rule). Right now you’re at about $455. Another thing that may help is doing 39 month lease. You’ll still be under Audi warranty.
One thing working against you is that TX charges tax on the fulll sale price of the car, not just lease payments.
And like any deal, be prepared to walk away. Perhaps March will bring better incentives and lower MF. Who knows.
Couple things I would add. Try and get Texas sales tax credits, that will knock $1700 off the tax amount.
Also add Audicare, it bumps the residual up by 1% so means your total servicing on the vehicle is around $400 and will save you money. For 12k miles Audicare makes sense.
Putting money down does not avoid interest. If a car lease cost $15k over three years, the money factor applies to that $15k total. It doesn’t matter if you put zero down or $5k down, you are spending a fixed amount on the interest over the three years. And that’s why it’s called money factor and not APR, because while you can certainly convert it to get an APR equivalent, it’s not a factor of your monthly payments.
OP - get rid of nitrogen and tint immediately. That’s an easy thing to toss away. Down payment should be $0. Discount off sticker and before incentives should be at least 10%. When I leased my A4 in September, I got close to 20% off sticker, but there were great incentives on Audi a few months ago. My sticker was around $44,5xx and my sales price I think $35,8xx, so cheaper than yours even though it was a Premium Plus.
Your model doesn’t even have the convenience package? This is bare, bare bones. I’d get an Accord over this stripped Audi any day of the week
That is definitely not correct… you are paying interest on the whole car, not just the lease but do save money by putting money down. Why are 1 pay leases less money then?
Also, you logic assumes that if I pay sales tax or fees upfront I’m still paying interest on those items? That doesn’t make any sense.
That’s about $380 all in which is a good deal for this car.
2 suggestions:
roll some more into the monthly payment to pay less DAS. Ask for $340/month with $1500 DAS and be prepared to agree on it as soon as they do (assuming you’re serious about this).
Also, consider putting down 10 (maximum) MSDs to lower the payment even further. MSDs are fully refunded at lease end.
Lastly, I’m not as familiar with TX, but can’t you get some sort of tax credit to offset the high sales tax?
Roll in the $3,500 into your monthly. Don’t put money down on a lease!
Did they remove the tint and “lifetime nitrogen”? It’s important they remove that.
It’s okay for an Audi, but this car is significantly lacking in features as a stripped A4.
Also put down MSDs to lower the money factor. This will save you quite a bit - put the money down towards MSDs that you get back at lease end, not towards reducing your monthly. That’s throwing away money.
One pay leases are cheaper because the money factor is lowered.
Putting a down payment does not effect your total outlay on a lease. There is no monthly interest on a lease, just a money factor calculated from the total spend on the leas that is spread over the time of the lease, no matter how the payments are divided.
Money factor is absolutely interest. It’s just reverse engineered to permit expensing payments versus depreciating an asset and deducting interest. So much so that GAAP and the IRS have explicit rules on how to report capital leases as loans and when you’re allowed vs. required to do so.
