Monthly lease payments
09-06-09, 05:29 PM
#16
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Your deal was for 12k/year, and I would be at 15k/year. That obviously changed your residual compared to mine. Perhaps that also changes the money factor. I had understood that the moneyfactor, like the residual, was set by LFS and was not a negotiating point with the dealer. Does anyone think this isn't correct?
That is the main reason why I lease as well.
09-11-09, 02:51 PM
#17
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Couple of points here:
1. I would be very surprised if the MF was always set in stone in these leases, my gut is LFS has a base rate and then the dealers can tack on a certain amount to the MF as back-end profit. I'm very familiar with BMWFS leases, the dealers there are allowed to mark up MFs up to .0004 over base and I imagine LFS and the dealers do things similarly.
Typically the base rates and residuals for a given car and month can be readily found online at sites like leasecompare.com, hopefully everyone here at least made an effort to find them before they say down with the F&I guy.
2. I'm not sure where all this paying cash = pricing leverage comes from. Dealers make money financing cars as well as selling them, either through captive or 3rd party lenders. In pricing negotiations I would never tell a dealer up front that I was paying cash, that's just one less profit opportunity they know they're going to have, and their "best offer" will be adjusted accordingly. There are a lot of places in life where cash is king, a car dealer's showroom is not one of them.
That's my experience anyway, others may vary.
1. I would be very surprised if the MF was always set in stone in these leases, my gut is LFS has a base rate and then the dealers can tack on a certain amount to the MF as back-end profit. I'm very familiar with BMWFS leases, the dealers there are allowed to mark up MFs up to .0004 over base and I imagine LFS and the dealers do things similarly.
Typically the base rates and residuals for a given car and month can be readily found online at sites like leasecompare.com, hopefully everyone here at least made an effort to find them before they say down with the F&I guy.
2. I'm not sure where all this paying cash = pricing leverage comes from. Dealers make money financing cars as well as selling them, either through captive or 3rd party lenders. In pricing negotiations I would never tell a dealer up front that I was paying cash, that's just one less profit opportunity they know they're going to have, and their "best offer" will be adjusted accordingly. There are a lot of places in life where cash is king, a car dealer's showroom is not one of them.
That's my experience anyway, others may vary.
Last edited by ObsidianRX; 09-11-09 at 02:57 PM.
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