Speedraser

The lease on my '95 993 Coupe is up in March -- I have to buy the car or give it back. Although I'll look around at various alternatives, I'm pretty certain I want to keep the car -- I love it.

Does anyone have any advice regarding how to try to negotiate a lower purchase price with the leasing company than the contracted residual? The residual is about $35,500. I think the car is worth more than this, even in this depressed market. It's a late '95 -- May '95 build -- has 50,000 miles, is well optioned and is in virtually perfect condition. Nevertheless, as I'm in grad school I have no income, so every dollar counts. BTW, the leasing company has gotten out of the leasing business, so some other entity owns the interest in the car.

Phil

you need to contact the "new entity"
you can probably buy it for the residual + termantion fee of 195.00 too 395.00

you can even try to get a lower payoff...just depends if the "new entity" knows the resale auto biz

dwe8922

It is to the leasing company's advantage to sell you your car. When my sister's volvo lease ended, her residual was 13k. She ended up paying 10k. I thought they made a mistake at first, but she said when she hesitated with them, they asked her if she would be willing to buy the car out for 10k. It's worth trying to negotiate; I always thought lease buyouts were non-negotiable.

David

Fens

Right now the ball is in your court and you have the advantage. The lease companies base their contracts on the residuals...the higher the residual the lower the monthly payments and so it shakes down the whole deal. When your contract was cut the economy was probably pretty good and residuals were holding up fairly well. But now the economy is down and used cars are glutting the market. Especially with the 0% interest financing on the new cars. Check if you can with someone that knows the prices that similar models are going for at auction and offer a reasonable sweetner to the price and I bet they go for it or at least will enter into negotiations. Right now the leasing companies are taking it in the shorts with the glut of cars going off lease and right to the auctions because the used market is so bad. If they are still in a state of denial, just chalk it up to dealer/F&I mentality, but stick to your facts and guns and they will probably come around.

David in LA

call the lease company and ask if you can extend the lease for 1-2 more months since you are "having problems finding a substitute car to buy".

J4Site

Most independent leasing companies are not going to negotiate the price. They do not have a consistant product that they lease so they do not know what the value is. Because they are afraid of employee theft they will not move off of the residual.

The leasing company does NOT have to sell you the car at the residual price. They will want FMV. I have no idea how they determine FMV.

However, if you are dealing with the manufacture (GM, Ford, Chrysler, ect) they know there product very well and will sell you the car at a predetermined amount. I have two friends with almost identical Jeep Grand Cherokees a year ago. One had like 20k miles on had just under 40k miles. The price offered was identical to both people. The residual value was like $28k on both but Chrysler offered both at $23k (if my memory serves me right).

I have also seen a leasing company who got lucky on a residual - a 1998 M3 I believe. The residual was like $26k after three year but would not take less than $30k on the car. That is the difference from a closed-end lease (you must buy the car at the residual or make up the difference) to any open-end lease (you have no responsibility in the residual value).

Good luck on your Porsche, I don't think they will budge!

jes999

Here is one strategy that has worked for me in the past.

Call them and tell them that you are interested in buying the car. Tell them that the mileage is just under the max allowed in the lease. Ask them how much they want for the car. They will probably have to get back to you. After they contact you with a buyout figure, call them back a few days later and offer them 10% less.

Phil

The leasing company does NOT have to sell you the car at the residual price. They will want FMV. I have no idea how they determine FMV.

If its a closed end lease, they Have to sell it for residual
Only an opened lease has the "fmv" option

Mike W

I really question the value of a 95 993 with 50000 miles. You might get $35000 retail, but wholesale value is probably closer to $30000. I have been looking at TT's at various dealers and (I have a 95 with alot of $ invested) and I've been offered between $25-30K. You might try an equity lease which would keep your payments down. Mike W

Speedraser

Thanks for the input, everyone.

Phil -- I don't know who the new entity is. All transactions are still going through the original leasing company.

Mike W: What is an "equity lease"? I, too, doubt that the car is worth $35K wholesale, but the issue for me is whether I could find another 993 in comparable condition (or anything else I'd rather have) for less than it will cost me to exercise my purchase option -- $35K. I don't think I could, since I'd be looking at retail prices. I think really nice '95 993 Coupes are still retailing for more than $35K. Does anyone agree/disagree? Although my car has 50,000 miles, it still trophies at local (Long Island) PCA concours events.

Does anyone have any thoughts on how long before the end of the lease I should start trying to negotiate a lower purchase price? The lease is up at the end of March.

Kevin Reilly

One more data point...when my old Lexus lease was up I tried to negotiate a lower buyout price than the residual because my mother in law wanted the car. I got nowhere.

A friend of mine with the exact same car and almost the same lease (but a different leasing co) was called a couple of times with offers to sell the car to him at a price below the residual.

I think one thing that might matter here is whether the leasing co has hedged or insured the difference between the residual value and the real FMV. If they have, then they might not care, on average, whether a car with a $35k residual is only really worth $32k. They've hedged or insured the $3k difference. It isn't worth the hassle to try and broker a deal with individuals on a case-by-case basis.

Mike W

Todd, I have what I think is a good source for a lease. Email or call me (877-888-9895) and I'll pass it along to you. Mike W