purebliss

If your on the fence on a lease make sure you make up your mind by Thrusday

greg h

Would you mind explaining how this comes into play on a lease...I've never leased a car. Thanks!!

purebliss

It what the leased is based on meaning that in 3 years with 36,000 miles on the car it should be worth 48%. Now if it was worth 50% you would get a better lease rate because the bank knows it will be worth more.

Faraaz23

Holy crap, 48%?? I'm assuming this is the 4 year residual which was.... about 52% before?

Greg H, the residual is the value of the car that Lexus calculates the car to be after the lease period. Hence, the residual of 48 means the car is expected to be worth 48% of original price after the lease is up. In a lease, you are basically paying for the depreciation of the car over that time period you have it. I'm not sure what the pre-Thursday residual was, but for example, lets use 50. Before, you would be paying for 50% of the value of the car. But now the residual is dropping, the car is going to depreciate more while its in your hands. Hence, with the new lease with 48 residual, you are going to be paying for 52% of the value of the car. There are other factors (like money factor) in the lease, but this is what the residual means and what it is in context of the lease.

Eternity3G

I got mine in March for 3 year / 36month (or 39???) at 53% risidual!.. Glad I did it before the change.....

HemantS

53% after three years isn't that great, the car will likely be worth more

Eternity3G

Compared to 48% though??? That makes no sense... a higher residual (53%) on the vehicle means you are negotiating payments on 47% of the price of the vehicle. vice versa, if residual is 48%, then you are paying 52% rather than the 47% from the 53-point residual.

ie. If the negotiated price of the car is $50,000, then:

(Option A) (53% residual)
Over the course of 36 months, you are paying 47% of the 50k ($23,500)

(Option B) (48% residual)
Over the course of 36 months, you are paying 52% of the 50K ($26,000)

I was fortunate enough to get a finance rate of 1.88% so it's like almost nothing!

Who cares what the car is worth after unless you are going to lease and buy after... then you are screwed... I'm planning to give the car up after the lease so the higher the residual, the better! That means less for me!

(if that wasn't directed toward me, ignore me...)

BobsGX

Thats why I haven't leased a vehicle since 96. They always play around with the numbers on a lease so you never know exactly to the dollar what you are actually paying for the vehicle. I don't care what the numbers breakdown show, you are never sure what the actual cost of the vehicle is.

doug_999

I believe he was pointing out that the car will probably hold its value better than even the 53% residual. This CAN work out to your advantage - especially if the difference is a lot as you can often buy the car out of the lease and possibly make money and/or get out of the lease early and not get crushed (depending on how your state taxes leases)

My 03 GS430 had a 60% residual (I think) and at the end of the lease was just about dead on with what it was worth.

LexFather

Have yall looked in the ads or even autotrader. The GS is holding value very well.

I know, been shopping

purebliss

The bank has to be careful because they don't want to get screwed at the end.