aabueg2005

I'm about to do a custom order on a 991.2 C4 and I am planning to lease it. Now given the MF for Porsche Financial is a horrendous 0.002 (4.8% APR) with no chances of buying it down thru MSD's, wouldn't it make better sense to do a larger cap cost reduction (down payment) so that you only pay interest for a smaller net capitalized cost. I think I still pay taxes on the cap cost reduction though. This goes against the usual advise of zero down, full MSDs for a lease. But given no MsDs are allowed and a high MF kinda negates the advantage. I am leasing for business tax purposes. Any thoughts?

sean7a

You're on the hook for that cap reduction cost if something were to happen. That money ain't coming back. I've never read a compelling argument (or read any argument) pushing for cap reduction on a lease. Conventional wisdom says NEVER put money down on a lease.

Best bet is to ensure your MF is at .002 (some dealers will try to go higher) and negotiate down that sales price. Dats all you got goin for ya.

Jeffdehr

You also give up your down payment if you decide to take advantage of the pull ahead program to swap out up to 12 months early.

Compare your net after tax cost of lease via business vs financing.

You can also make a one time lease payment upfront if your goal is to minimize interest for a lease but that's even riskier.

aabueg2005

Thank you for the replies. I do realize that in the slim chance the car is totaled or stolen, its goodbye cap cost money. Financing it would be better if it was a 100% personal car, but if its thru my business, I can only depreciate it for so much a year and thats capped through the life of the car so tax deducting the lease payments may make better sense. I did some computations and it seems like you save about $500 in financing charges per $5k of cap cost you place over the life of the lease. Not sure if that is worth it.

tgcrun

I used to put money down to reduce my payments but no longer do that for two reasons. The cap cost reduction payment isn't tax deductible and I can make better use of the cash. If you want to put some cash into the transaction use it to pay the leasing fee, the first month's payment and any other fees. Also, I purchased the maintenance plan with an up front payment. It increased the residual by 1%, so the plan is practically free.

aabueg2005

I think that makes sense since the fees are not taxable even the maintenance plan. Thanks!

Jeffdehr

Perfect! The dealer doesn't always share the 1% increase in residual with the prepaid maintenance plan. If you know about this you should be able to get the maintenance plan for no cost / very little cost as the bump in residual is worth about the same as the plan.

clubrcr

I am planning on signing a lease deal in the next few days. The money factor is .002 and I have received a high discount. Of course I want the dest deal possible. Will Porsche dealers negotiate the money factor, or is that written in stone?

aabueg2005

It sounds like Porsche financial is very stingy with MF changes. How much of a discount did you get? The most I got was 5% for a basic C4 build with 8k of options.

clubrcr

This is for my wife, she wanted a Panamera. I am leasing her an "S" and I being offered a 8.5%/9K discount, plus the prepaid maintenance and they are shipping it to me for free. I am assuming the Porsche dealerships are trying to unload all these since the new ones are going to redesigned.

aabueg2005

Gotcha. Yes, the 2017 Panny will be out later this year. I thought I was getting screwed with 5% only discount on a 2017 911.

I just called my SA and placed my deposit today. They said it's weird that there are no allocations for a C4 anywhere in the US that can be changed yet. I wonder if the Porsche factory is on holiday break.

clubrcr

aaburg2005....Did you see that Porsche continued the "Porsche Conquest Lease Program" where they will pay 3 month lease payments for a non-Porsche lease that has less than 180 days to termination

aabueg2005

No, I didn't know about that. I will be trading in another car for it so it won't apply to me. But that's a nice to know to others wanting to get out of their non-porsche lease.

bmedude

The catch is that you must finance through PFS, which tends to have higher interest rates

squid42

You should be able to buy extra gap insurance to also cover your deposit. The problem is that the gap insurance included in the lease deal doesn't cover it above what has been financed through the lease.

Why are MSDs not allowed in your deal?