adsc4s

I've got too many bills as it is, one less is always better in my book.

CLL ACAB

In CA, I like to lease because I only keep my cars 2-3 years and don't want to pay sales tax on the residual. CA does not allow for a credit on the trade-in value if you purchase, but if you lease, you only pay sales tax on the monthly lease payment. So on my present car I am saving about $3,000 in sales tax by leasing. In addition, it's a great benefit to me not having to worry about selling the car or getting ripped off from a "stealer" on a trade-in. At the end of the lease, I just drop the keys and walk. And if I have value in the car over the residual, I can always try to sell it and pocket the difference.

StatmanDesigns

Most likely then you would not have the resources to purchase a new car outright. If you want a new car there are only three choices: buy it, lease it, or steal it, .

Leasing is 99% of the time for new cars, we are not talking about 2 year old cars. Much of the benefit is that the leased car is never out of warranty and most new cars come with all scheduled maintenance included. Why do you think new cars depreciate so damn quickly. It is because their warranties evaporate after 3-4 years.

CLL ACAB

Dan,

I leased my C4 Cab as a two year old car. It has the Porsche extended warranty and someone else took the big hit up front - $40K! I must be in that 1% category.....

Dave

Viken

A small clarification on Daniel's original post, if I may. The residual is a percentage of the vehicle's MSRP. Capitalized cost is the agreed upon purchase price which may or may not equal the MSRP.

autounion1

Working at an Audi dealership, I can assure you that this gentleman is correct in his theory. However, I would make two comments. Be weary of the car company's with 57% and higher residuals, as the dealership is surely making the residual payoff so high compared to end-market value that it behooves the consumer to turn the car in. (BMW 745's are the biggest culprit in the market today) However, a REAL lease deal, you can purchase the car at the end of the lease and actually sell it privately for a profit. The common wives tail is that a dealership can manipulate money factor's, however, in reality the manufacturer has strict guidelines on this issue, and they cannot be changed. This makes sense, mainly because the advertised leases you see on TV simply would not work. James

adsc4s

I have purchased my last 6 cars with cash. Like I said, one less monthly bill is always better in my book.

Viken

There is no such thing as *fixed* money factors. A dealer may choose to lease you a car using a buy rate or jack it up a few points to make some money on the lease. It is no different from MSRP. The deals you see advertised on TV and the papers are based on *suggested* terms, money factors and pre-determined residuals based on the term. Most of them also include a cap reduction cost. A customer can just go in and alter the terms as long as the dealer and him/her have agreed to them.

autounion1

I wish I could scan this month's lease program for Certified Audi Dealership's. I will, however, parphrase it for you. "Model Year04/05 10k, 12k, and 15k new vehicle eligible only, maximun allowance for money factor increase= (+,-) 0.00000 percent."
Again, increasing issued money factors above and beyond what a manufacturers rates are is not allowed.
What you are refering to is a "balloon lease." These are deadly, and I recommend staying as far away from them as possible.

Viken

Ok, so you are talking of a maximum cap on a money factor markup. Are you talking about special lease deals through Audi Financial or in general? I have seen leases through other companies where the dealer increased the money factor at will.

hatchy

Good info. Never considered a lease, mainly because none of my cars are stock and I usually hold on to them for a while.

autounion1

I will tell you that most leases are "canned" the analogy that you open them up and they cannot be manipulated. These are for most of our vehicles. I will give it to you, however, that some specialty vehicles like our RS-6 and the upcoming A8-W12 the dealership makes up the own lease rates from scratch with certain minor stipulations from Audi. (as to not completely screw the customer) Again, as for the a4, a6, TT, and ALLrOAD vehicles, the money factors are not to be manipulated.

billh1963

"Leasing" is known as "fleecing" for a reason. I'm sure for a very small percentage of people it makes sense but after having leased a car twice (trying to live beyond my means when I was younger) it won't happen again.

Dave Ramsey did the math in his "Total Money Makeover" book and showed that if a 25 year old kept a $400/month car payment until he was 65 he was throwing away $1.4MM USD assuming an 8% return. That is why all three of my cars are paid for, when I buy a 996 or 997 (used) it will be with cash, and my new house will be paid for in 5 more years. When you have debt you are tying up your most important wealth building tool....your income!

Bill (NC)

I leased my 2000 C4 and when I went to turn it in the payoff was around $58k and the value was closer to $51k. During the conversations they have with you near the end I inquired if they wanted to "deal" at all on the payoff figure. They declined and the car went straight to the auction and sold for $51k. (I know because the buyer called me) I never could understand why they didn't want to discount the price, to save the auction. Well, the other day I was taking about this to a Porsche sales manager and his explaination was that there is one main company that sets residuals for the major lease companies (Chase in this case) and that as a part of the deal they guarantee their numbers to the lease companies, not a complete recapture but enough that it doesn't pay the lease companies to bother with making deals. Learn something new every day.

David in LA

A lot of leasing companies now buy residual insurance after having been burned in the past...they have no motivation whatsoever to negotiate the buy-out price when the lease is up.