First time leasee, need advice.
08-12-15, 04:16 AM
#16
Investing the 10K a few years ago would have been wise with anywhere from 6% to up to 10% returns were the normal. With the markets tanking and further to go IMO he may get more out of the trade now than later. Like you mentioned the used car will depreciate over three years anyway. Im still very interested if the OP can get a $500.00 lease on the RCF with 10K down. It must be an absolute base model or getting a very large discount off MSRP.
But you could invest that $10k and let it work for you for 3 yrs. just my opinion. If it were a straight trade in...sure because it's something that you own, although still a depreciating asset. You would still be creating a certain amount of equity in the vehicle.
No big deal, tho. I'm just of the opinion that you put as little money down on a lease as possible.
No big deal, tho. I'm just of the opinion that you put as little money down on a lease as possible.
08-12-15, 04:48 AM
#17
Lexus Test Driver
Here's some info that could help you get the RCF at the best terms... Play a couple dealers against each other and if you have a favorite color or trim level don't give up the info. Let them think the the other dealers also have the car, color choices and options you want. Competition is the easiest way to get them fighting for your business.
On the lease terms you need to know the money factor. The RCF does't lease out as well as the RC350. The residuals are lower and the money factor isn't nearly as good this month. The money factor on the RCF lease should be .0017 for tier 1 credit whereas the RC350 is currently .0009. If they won't tell you the money factor then walk out...they are trying to hide the fact that they are killing you on the back end, just like ghoffner above getting quoted a .0028 money factor (unless credit justifies it).
The BEST and most creative way to utilize the $10k in equity is to put that money down as MSDs (Multiple Security Deposits). Each MSD is equal to your monthly lease payment rounded up to the nearest $25. Toyota/Lexus Financial allows you to put down up to 9 MSDs. Each MSD drops your money factor by .00008 so by putting MSDs down instead of capital cost reduction you are dropping your cost of money and thus your payment. The best part about MSDs is that when you turn the car back in you get them back as it's a security DEPOSIT and not a down payment. This is a MUCH better use of your money and a great way to get your payment down to where you want while not throwing your money away. That money in equity never goes away. When you turn the car back in you now have that to use on your next car.
I learned this advice from others here on CL while doing my homework on leasing my RC350 F Sport so I can't take credit for the info above...Do a google search on leasing and you'll get a ton of info. Edmunds has some great info and a lease calculator.
Hope this helps and good luck!
JP
On the lease terms you need to know the money factor. The RCF does't lease out as well as the RC350. The residuals are lower and the money factor isn't nearly as good this month. The money factor on the RCF lease should be .0017 for tier 1 credit whereas the RC350 is currently .0009. If they won't tell you the money factor then walk out...they are trying to hide the fact that they are killing you on the back end, just like ghoffner above getting quoted a .0028 money factor (unless credit justifies it).
The BEST and most creative way to utilize the $10k in equity is to put that money down as MSDs (Multiple Security Deposits). Each MSD is equal to your monthly lease payment rounded up to the nearest $25. Toyota/Lexus Financial allows you to put down up to 9 MSDs. Each MSD drops your money factor by .00008 so by putting MSDs down instead of capital cost reduction you are dropping your cost of money and thus your payment. The best part about MSDs is that when you turn the car back in you get them back as it's a security DEPOSIT and not a down payment. This is a MUCH better use of your money and a great way to get your payment down to where you want while not throwing your money away. That money in equity never goes away. When you turn the car back in you now have that to use on your next car.
I learned this advice from others here on CL while doing my homework on leasing my RC350 F Sport so I can't take credit for the info above...Do a google search on leasing and you'll get a ton of info. Edmunds has some great info and a lease calculator.
Hope this helps and good luck!
JP
08-12-15, 05:50 AM
#18
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This is great advice from Jeremy above. One thing I would add is that you should be able to do all of the calculations to see how the dealer is coming up with your lease payment. Once you are to that point you will understand the different angles the dealer can use to make more money.
I agree with Jeremy 100% regarding the $10k. This is the only way I would consider using the money if it must go towards the car as you have a guaranteed return on your investment, and when the lease is done you will get your money back and you can do it all over again! In the event that the car was a total loss (especially early on in the lease)I would not want to be in the situation of trying to get all or a portion of my $10k back!
As others have said pit the dealers against each other and make them work for your business. I usually call around to as many as possible, and then take the one with the lowest price and make them all work to beat that. Never let the dealer know they have the color combo you want! In fact I always tell the dealer that has the color I like that it is actually a color I would be willing to settle for if they can discount it a bit more!
Once I reach a certain point of course negotiations are over and the dealer has my business. If a dealer has worked with you, been helpful, and honest throughout the process I would never take my business elsewhere in the end for another $500 or something.
Good luck, and most importantly, have fun!
I agree with Jeremy 100% regarding the $10k. This is the only way I would consider using the money if it must go towards the car as you have a guaranteed return on your investment, and when the lease is done you will get your money back and you can do it all over again! In the event that the car was a total loss (especially early on in the lease)I would not want to be in the situation of trying to get all or a portion of my $10k back!
As others have said pit the dealers against each other and make them work for your business. I usually call around to as many as possible, and then take the one with the lowest price and make them all work to beat that. Never let the dealer know they have the color combo you want! In fact I always tell the dealer that has the color I like that it is actually a color I would be willing to settle for if they can discount it a bit more!
Once I reach a certain point of course negotiations are over and the dealer has my business. If a dealer has worked with you, been helpful, and honest throughout the process I would never take my business elsewhere in the end for another $500 or something.
Good luck, and most importantly, have fun!
08-14-15, 07:22 PM
#20
Lexus Test Driver
Here's some info that could help you get the RCF at the best terms... Play a couple dealers against each other and if you have a favorite color or trim level don't give up the info. Let them think the the other dealers also have the car, color choices and options you want. Competition is the easiest way to get them fighting for your business.
On the lease terms you need to know the money factor. The RCF does't lease out as well as the RC350. The residuals are lower and the money factor isn't nearly as good this month. The money factor on the RCF lease should be .0017 for tier 1 credit whereas the RC350 is currently .0009. If they won't tell you the money factor then walk out...they are trying to hide the fact that they are killing you on the back end, just like ghoffner above getting quoted a .0028 money factor (unless credit justifies it).
The BEST and most creative way to utilize the $10k in equity is to put that money down as MSDs (Multiple Security Deposits). Each MSD is equal to your monthly lease payment rounded up to the nearest $25. Toyota/Lexus Financial allows you to put down up to 9 MSDs. Each MSD drops your money factor by .00008 so by putting MSDs down instead of capital cost reduction you are dropping your cost of money and thus your payment. The best part about MSDs is that when you turn the car back in you get them back as it's a security DEPOSIT and not a down payment. This is a MUCH better use of your money and a great way to get your payment down to where you want while not throwing your money away. That money in equity never goes away. When you turn the car back in you now have that to use on your next car.
I learned this advice from others here on CL while doing my homework on leasing my RC350 F Sport so I can't take credit for the info above...Do a google search on leasing and you'll get a ton of info. Edmunds has some great info and a lease calculator.
Hope this helps and good luck!
JP
On the lease terms you need to know the money factor. The RCF does't lease out as well as the RC350. The residuals are lower and the money factor isn't nearly as good this month. The money factor on the RCF lease should be .0017 for tier 1 credit whereas the RC350 is currently .0009. If they won't tell you the money factor then walk out...they are trying to hide the fact that they are killing you on the back end, just like ghoffner above getting quoted a .0028 money factor (unless credit justifies it).
The BEST and most creative way to utilize the $10k in equity is to put that money down as MSDs (Multiple Security Deposits). Each MSD is equal to your monthly lease payment rounded up to the nearest $25. Toyota/Lexus Financial allows you to put down up to 9 MSDs. Each MSD drops your money factor by .00008 so by putting MSDs down instead of capital cost reduction you are dropping your cost of money and thus your payment. The best part about MSDs is that when you turn the car back in you get them back as it's a security DEPOSIT and not a down payment. This is a MUCH better use of your money and a great way to get your payment down to where you want while not throwing your money away. That money in equity never goes away. When you turn the car back in you now have that to use on your next car.
I learned this advice from others here on CL while doing my homework on leasing my RC350 F Sport so I can't take credit for the info above...Do a google search on leasing and you'll get a ton of info. Edmunds has some great info and a lease calculator.
Hope this helps and good luck!
JP
A lot of alleged internet deals are bs. After all, it is the internet. I see some quotes or alleged purchase deals (more so on other models than RC F) and I saying no way. Sure, some dealers move product occasionally at a paper loss to meet goals and get back end $$$, but some of the alleged deals quoted just ain't happening.
Pitting one dealer against another may or may not work, Many don't care and won't budge. The amount you may save by going to all ends of the earth to get the best deal eva and be king of the deal makers can be pretty silly. Wow, you spent hours shopping multiple dealers to save a $ 1,000! Congrats, you saved $ 20 a month on a purchase deal or you just cut your note from $ 1,094 to $ 1,062 on an $ 80,000 car, 36 month lease with nothing out of pocket at signing. Awesome, but now you gotta pay $ 500 to ship and you could have made more during the time wasted at a decent hourly rate than what you ultimately saved.
Deals just won't vary that much from dealer to dealer on new cars when the cars are comparable in list price. So the question is, do you really wanna buy a car or do you just want to feel satisfied in that you beat the dealers down like no other? If you are that stressed or spun out over saving an extra $ 500 or $ 1,000 on an $ 80,000 car, you may stretching that budget a bit too much to make that car work.
Last edited by DougHII; 08-14-15 at 08:07 PM.
08-14-15, 08:29 PM
#21
Lexus Test Driver
Doug, You make some good points and I agree with you that spending dollars to chase pennies doesn't make sense. However, in some areas of the country dealers just don't give deals unless you work them a little. It didn't take much more work than making some phone calls and a visit to my closest dealer.
If I didn't have three different dealers competing then I would have been stuck with a much higher money factor and capital cost than if I didn't. I saved a couple grand on the cost and a considerable amount on the monthly payments. Was it worth it? Absolutely. Did I take the absolute lowest deal? No, I paid a hair under $300 more to buy it from the dealer that is 15 minutes from my house because of the convenience and I liked the sales person better.
By the way, the money factor for the RC350 and the RCF are not the same. At least not this month. The base rate for top tier credit for the RC350 is still .0009 and the RCF is .0017.
JP
If I didn't have three different dealers competing then I would have been stuck with a much higher money factor and capital cost than if I didn't. I saved a couple grand on the cost and a considerable amount on the monthly payments. Was it worth it? Absolutely. Did I take the absolute lowest deal? No, I paid a hair under $300 more to buy it from the dealer that is 15 minutes from my house because of the convenience and I liked the sales person better.
By the way, the money factor for the RC350 and the RCF are not the same. At least not this month. The base rate for top tier credit for the RC350 is still .0009 and the RCF is .0017.
JP
08-15-15, 07:15 AM
#22
Lexus Test Driver
Doug, You make some good points and I agree with you that spending dollars to chase pennies doesn't make sense. However, in some areas of the country dealers just don't give deals unless you work them a little. It didn't take much more work than making some phone calls and a visit to my closest dealer.
If I didn't have three different dealers competing then I would have been stuck with a much higher money factor and capital cost than if I didn't. I saved a couple grand on the cost and a considerable amount on the monthly payments. Was it worth it? Absolutely. Did I take the absolute lowest deal? No, I paid a hair under $300 more to buy it from the dealer that is 15 minutes from my house because of the convenience and I liked the sales person better.
By the way, the money factor for the RC350 and the RCF are not the same. At least not this month. The base rate for top tier credit for the RC350 is still .0009 and the RCF is .0017.
JP
If I didn't have three different dealers competing then I would have been stuck with a much higher money factor and capital cost than if I didn't. I saved a couple grand on the cost and a considerable amount on the monthly payments. Was it worth it? Absolutely. Did I take the absolute lowest deal? No, I paid a hair under $300 more to buy it from the dealer that is 15 minutes from my house because of the convenience and I liked the sales person better.
By the way, the money factor for the RC350 and the RCF are not the same. At least not this month. The base rate for top tier credit for the RC350 is still .0009 and the RCF is .0017.
JP
At the end of the day, buy from your local dealer. Establish a good relationship from your local dealer and your sales person. They will take care of you in the long run. Once you have a relationship built with your local dealer, you will get the good deals without having to waste time haggling.
I purchased over 15 vehicles from a single Porsche dealership. I can now pick up the phone or they call me when they have a car I want. They immediately tell me the best price they can offer without any back and forth over the phone (typically $ 500 over invoice unless special vehicles such as GTs or RSs) they have paper work ready, I go by, sign and pick up my cars. Instead of hours haggling and doing paperwork, I spend more time socializing when I am there.
Then there are the added perks of being a loyal customer of your local dealer. I have had items covered by good will that were questionable due to track use, over revs or warranty expired due to dealer going to bat for me. Try getting a manufacturer to good will something without local dealer support . . .
For instance, I purchased my Lotus from them and that car had 3 transmissions and engine replaced. I had over revs, the car sat on slicks, had harnesses, Lexan window and a data logger mounted on the dash. Lotus initially tried to deny warranty on first transmission, but the dealer convinced them not to based on me being one my relationship with the dealer (I listened to the phone call and spoke with the Lotus rep from Atlanta shortly after). Lotus covered the remaining 2 trannies and the engine without hassle from that point forward even though they knew the car was used primarily for instructing on the race track. I heard of many others not getting $ 17k trannies covered due to over revs and track use from horror stories on Lotus Talk.
Then there are the intangibles. Everyone one in the that dealership from the front to the mechanics in back know my name and come up and shake my hand. I am able to go back into the actual work areas, talk the the techs and watch them drop engines, drop transmissions and work on my cars, especially when track prepping my Cup cars.
The crux of this is that there is more to life and purchasing high end cars than trying to nut cut everyone and save a whopping $ 500 or a $ 1,000 on the front end. Everyone wants to be treated special, but no one wants to work for the special it.
08-15-15, 02:01 PM
#23
Driver
Thread Starter
Great info everyone! It seems like MSDs are a great alternative as far as using that equity towards the trade, I spoke to one of the brokers over at the local Lexus and he told me whenever I'm ready to come in he can make something work! 
One of my concerns when it comes to using a MSD I know that at the end of the lease you are supposedly suppose to get some of that money back, but my question is, hypotethically speaking of course, in the event the vehicle is stolen or totaled, is that money still owed back to you or gone?
Also, is GAP insurance something I should look into with my insurance company for something like this?
I will probably be heading in there sometime this week or the next whenever I get the chance to put word to paper with the dealer, but hopefully if all works out I will be walking...err driving out with a RC-F or GS-F sport
And as far as the others go, I will see if the dealer can extend this offer to those out of state, maybe I can use this as a bargaining chip to leverage the deal in my favor :0
-J
One of my concerns when it comes to using a MSD I know that at the end of the lease you are supposedly suppose to get some of that money back, but my question is, hypotethically speaking of course, in the event the vehicle is stolen or totaled, is that money still owed back to you or gone?
Also, is GAP insurance something I should look into with my insurance company for something like this?
I will probably be heading in there sometime this week or the next whenever I get the chance to put word to paper with the dealer, but hopefully if all works out I will be walking...err driving out with a RC-F or GS-F sport
And as far as the others go, I will see if the dealer can extend this offer to those out of state, maybe I can use this as a bargaining chip to leverage the deal in my favor :0
-J
08-15-15, 02:05 PM
#24
Great info everyone! It seems like MSDs are a great alternative as far as using that equity towards the trade, I spoke to one of the brokers over at the local Lexus and he told me whenever I'm ready to come in he can make something work!
One of my concerns when it comes to using a MSD I know that at the end of the lease you are supposedly suppose to get some of that money back, but my question is, hypotethically speaking of course, in the event the vehicle is stolen or totaled, is that money still owed back to you or gone?
Also, is GAP insurance something I should look into with my insurance company for something like this?
I will probably be heading in there sometime this week or the next whenever I get the chance to put word to paper with the dealer, but hopefully if all works out I will be walking...err driving out with a RC-F or GS-F sport
And as far as the others go, I will see if the dealer can extend this offer to those out of state, maybe I can use this as a bargaining chip to leverage the deal in my favor :0
-J
One of my concerns when it comes to using a MSD I know that at the end of the lease you are supposedly suppose to get some of that money back, but my question is, hypotethically speaking of course, in the event the vehicle is stolen or totaled, is that money still owed back to you or gone?
Also, is GAP insurance something I should look into with my insurance company for something like this?
I will probably be heading in there sometime this week or the next whenever I get the chance to put word to paper with the dealer, but hopefully if all works out I will be walking...err driving out with a RC-F or GS-F sport
And as far as the others go, I will see if the dealer can extend this offer to those out of state, maybe I can use this as a bargaining chip to leverage the deal in my favor :0
-J
GL let us know how it turns out, for some reason i'm thinkin' you come out with the GS-F sport 
08-15-15, 02:28 PM
#25
Lexus Test Driver
Great info everyone! It seems like MSDs are a great alternative as far as using that equity towards the trade, I spoke to one of the brokers over at the local Lexus and he told me whenever I'm ready to come in he can make something work!
One of my concerns when it comes to using a MSD I know that at the end of the lease you are supposedly suppose to get some of that money back, but my question is, hypotethically speaking of course, in the event the vehicle is stolen or totaled, is that money still owed back to you or gone?
Also, is GAP insurance something I should look into with my insurance company for something like this?
I will probably be heading in there sometime this week or the next whenever I get the chance to put word to paper with the dealer, but hopefully if all works out I will be walking...err driving out with a RC-F or GS-F sport
And as far as the others go, I will see if the dealer can extend this offer to those out of state, maybe I can use this as a bargaining chip to leverage the deal in my favor :0
-J
One of my concerns when it comes to using a MSD I know that at the end of the lease you are supposedly suppose to get some of that money back, but my question is, hypotethically speaking of course, in the event the vehicle is stolen or totaled, is that money still owed back to you or gone?
Also, is GAP insurance something I should look into with my insurance company for something like this?
I will probably be heading in there sometime this week or the next whenever I get the chance to put word to paper with the dealer, but hopefully if all works out I will be walking...err driving out with a RC-F or GS-F sport
And as far as the others go, I will see if the dealer can extend this offer to those out of state, maybe I can use this as a bargaining chip to leverage the deal in my favor :0
-J
GAP insurance isn't a bad idea to discuss with your agent. It's usually very inexpensive to add GAP coverage and well worth it as long as it is a low cost add-on to your policy.
Keep us updated!
JP
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