No turbo for me...
04-05-2003, 09:14 AM
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No turbo for me...
Some of you may know I have been trying to figure out what options to order on my soon to be leased 996TT. I have been working closely with a leasing agent to get a good deal on a car.
After trying to order a car that was perfect we stubled upon a car I really liked that was in stock, but I had to visit the dealership to get the paperwork in order - this was last friday. I won't say the name of the dealer, but they are a huge group in central NJ. The salesperson was kind enough to take me to the prep center (a 15 minute drive) to see the car I had chosen and then we went back to the dealership to do some paperwork. I gave him my credit info and a deposit.
On monday I received a call saying that b/c of my credit problems a few years ago (I had a tough financial time when I was in dental school), my application was rejected by Chase (even with a $300K+ salary now), but he would try with Porsche financial because he was "sure" he could get it approved.
Tuesday I received a call from him saying we had Porsche financial approval, but at tier two, leaving my payments at around $1700 per month w/a $2500 cap cost. I said "thanks, but it's too much for a lease." and left it at that. I discussed things with my leasing agent and we decided we would go back to our original plan of getting the M3 convertible.
Here's where it gets interesting:
- Wednesday I get a call from the Porsche dealer saying the financial manager is trying to get me tier one approval - sounded good to me.
- Thursday afternoon my leasing agent calls and tells me we have tier one approval and the payments will be around $1500/mo with nothing down because residuals have changed - a little over what I wanted to spend, but still acceptable. We set a saturday morning (today) delivery date.
- Thursday afternnon I get a second call from the Porsche dealer saying he made a mistake and we didn't get full approval for the car, and in order to go ahead with the lease I had to bring over $15,000 as a down payment on saturday - I tell him this is completely unacceptable and he unsuccessfully tries to get porsche to approve me for the whole cost of the car. The dealer suggests that because we have approval for $110,000 at tier one, we get a car under that amount to avoid having to put anything down up front. Being that by this time the dealer has me in the "porsche mindset" we come up with a C4 cab very nicely equipped - again, saturday morning delivery.
- Yesterday I receive a call from my leasing agent saying "Porsche financial did it again" and I still needed to drop $10K plus at the beginning of the lease - but the car would be ready for delivery on saturday. At this point I cancelled the deal and kindly asked for my deposit back.
Is this commonpractice amongst dealers? Shouldn't the dealer have known based on our initial Tier 2 status that I would need to put more money down with Tier one approval? I know I had said multiple times that I didn't want to put money down up front because this was a lease.
Nonetheless, the whole experience has left me with a bitter taste. As much as I think the 996 Turbo is an amazing car, I am so turned off by the Porsche dealer stringing me along to get a sale that I want nothing more to do with them.
So that leaves me back where I started, very excited about buying my M3 cab. I have no problem putting down a large chunk for a car I will own and my leasing/buying agent said the financing will be no problem - we're placing the order on monday. Now I just have to wait.
But I will definitely have the Turbo someday, even if I have to pay the whole thing up front!
After trying to order a car that was perfect we stubled upon a car I really liked that was in stock, but I had to visit the dealership to get the paperwork in order - this was last friday. I won't say the name of the dealer, but they are a huge group in central NJ. The salesperson was kind enough to take me to the prep center (a 15 minute drive) to see the car I had chosen and then we went back to the dealership to do some paperwork. I gave him my credit info and a deposit.
On monday I received a call saying that b/c of my credit problems a few years ago (I had a tough financial time when I was in dental school), my application was rejected by Chase (even with a $300K+ salary now), but he would try with Porsche financial because he was "sure" he could get it approved.
Tuesday I received a call from him saying we had Porsche financial approval, but at tier two, leaving my payments at around $1700 per month w/a $2500 cap cost. I said "thanks, but it's too much for a lease." and left it at that. I discussed things with my leasing agent and we decided we would go back to our original plan of getting the M3 convertible.
Here's where it gets interesting:
- Wednesday I get a call from the Porsche dealer saying the financial manager is trying to get me tier one approval - sounded good to me.
- Thursday afternoon my leasing agent calls and tells me we have tier one approval and the payments will be around $1500/mo with nothing down because residuals have changed - a little over what I wanted to spend, but still acceptable. We set a saturday morning (today) delivery date.
- Thursday afternnon I get a second call from the Porsche dealer saying he made a mistake and we didn't get full approval for the car, and in order to go ahead with the lease I had to bring over $15,000 as a down payment on saturday - I tell him this is completely unacceptable and he unsuccessfully tries to get porsche to approve me for the whole cost of the car. The dealer suggests that because we have approval for $110,000 at tier one, we get a car under that amount to avoid having to put anything down up front. Being that by this time the dealer has me in the "porsche mindset" we come up with a C4 cab very nicely equipped - again, saturday morning delivery.
- Yesterday I receive a call from my leasing agent saying "Porsche financial did it again" and I still needed to drop $10K plus at the beginning of the lease - but the car would be ready for delivery on saturday. At this point I cancelled the deal and kindly asked for my deposit back.
Is this commonpractice amongst dealers? Shouldn't the dealer have known based on our initial Tier 2 status that I would need to put more money down with Tier one approval? I know I had said multiple times that I didn't want to put money down up front because this was a lease.
Nonetheless, the whole experience has left me with a bitter taste. As much as I think the 996 Turbo is an amazing car, I am so turned off by the Porsche dealer stringing me along to get a sale that I want nothing more to do with them.
So that leaves me back where I started, very excited about buying my M3 cab. I have no problem putting down a large chunk for a car I will own and my leasing/buying agent said the financing will be no problem - we're placing the order on monday. Now I just have to wait.
But I will definitely have the Turbo someday, even if I have to pay the whole thing up front!
04-05-2003, 10:19 AM
#2
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To get the best rate you must have a credit score of somthing like 740+, you should know your number ahead of time, that avoids the frendly dealership "were working for you" bla bla bla...
Sorry to hear of your financial straights, seems like you may live pretty large and your money comes in the front door and flows right out the back.
I don't make near the money you do, and I have no debt,
I just write check and buy car
It's that simple
Sorry to hear of your financial straights, seems like you may live pretty large and your money comes in the front door and flows right out the back.
I don't make near the money you do, and I have no debt,
I just write check and buy car
It's that simple
04-05-2003, 10:27 AM
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</font><blockquote><font size="1" face="Verdana,Tahoma,Helvetica">quote:</font><hr /><font size="2" face="Verdana,Tahoma,Helvetica">Originally posted by Dr. G:
<strong>
But I will definitely have the Turbo someday, even if I have to pay the whole thing up front!</strong></font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Helvetica">Do you have the saying in the US: Fur coat but no knickers ? <img border="0" alt="[cheers]" title="" src="graemlins/beerchug.gif" />
<strong>
But I will definitely have the Turbo someday, even if I have to pay the whole thing up front!</strong></font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Helvetica">Do you have the saying in the US: Fur coat but no knickers ? <img border="0" alt="[cheers]" title="" src="graemlins/beerchug.gif" />
04-05-2003, 11:18 AM
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Dr. G- I can certainly empathize with you. As a physician who is now 6 years out of residency, I know all too well the experience of the lean years. Clearly they have passed for you, and they passed pretty quickly for me.
I too was from the NY/NJ metro area and relocated to Dallas shortly after residency- the move was the second smartest decision I've ever made (#1 was marrying my wife). In my first 6 months out of residency I learned one very important financial rule for nearly all physicians; never lease anything and don't buy it(except maybe a home) unless you can write the check for it on the spot whenever possible. The painful lesson came through the lease of a Porsche Boxster, a $40K car that ended up costing me $50K to rent it for 4 years. Luckily it got wrecked and Park Place Porsche helped me get into a purchased car without being too much upside down. The second learning experience was in a lease/purchase of my office computer system- $42K for a $22K system, big prepayment penalties, and if I had any legal fight with the company it was a moot point because the small print in the lease contract had me agree to legal venue in California. Some docs choose to lease, but almost universally, for us leasing is a very poor financial option.
As docs, we tend to have above-average incomes but we enter the workforce usually with alot of debt from years of spending without income. Because student loans tend to get sold and moved and because of the fat credit history, there tend to be lots of mistakes on doctors' credit reports. I check mine every 6 months and it took me two years to get my credit reports straightened out. Some student loans were duplicated on my report, some old credit cards showed up as active. . .simply correcting errors raised my credit score from about 600 to 680, and knocking out most of my debt keeps me hovering around 725-750 now. To summarize, live humbly for a few years- the market sucks, so doubling up on mortgage and student loan payments will do lots of good. Avoid leases, and make sure that your credit report is correct with all major bureaus. Being debt-free or nearly so feels much better than any driving experience exhilirates or any gourmet meal could possibly taste. Max out your retirement plan, put your wife on salary and do the same for her. We lose 1-2 doubling cycles on our investments due to entering the workforce later in life.
BTW comrade, I'm not trying to preach at you. I simply figured that you're recently out of training and wanted to impart some of my painful experiences to you so that you could avoid the same. <img border="0" alt="[cheers]" title="" src="graemlins/beerchug.gif" />
I too was from the NY/NJ metro area and relocated to Dallas shortly after residency- the move was the second smartest decision I've ever made (#1 was marrying my wife). In my first 6 months out of residency I learned one very important financial rule for nearly all physicians; never lease anything and don't buy it(except maybe a home) unless you can write the check for it on the spot whenever possible. The painful lesson came through the lease of a Porsche Boxster, a $40K car that ended up costing me $50K to rent it for 4 years. Luckily it got wrecked and Park Place Porsche helped me get into a purchased car without being too much upside down. The second learning experience was in a lease/purchase of my office computer system- $42K for a $22K system, big prepayment penalties, and if I had any legal fight with the company it was a moot point because the small print in the lease contract had me agree to legal venue in California. Some docs choose to lease, but almost universally, for us leasing is a very poor financial option.
As docs, we tend to have above-average incomes but we enter the workforce usually with alot of debt from years of spending without income. Because student loans tend to get sold and moved and because of the fat credit history, there tend to be lots of mistakes on doctors' credit reports. I check mine every 6 months and it took me two years to get my credit reports straightened out. Some student loans were duplicated on my report, some old credit cards showed up as active. . .simply correcting errors raised my credit score from about 600 to 680, and knocking out most of my debt keeps me hovering around 725-750 now. To summarize, live humbly for a few years- the market sucks, so doubling up on mortgage and student loan payments will do lots of good. Avoid leases, and make sure that your credit report is correct with all major bureaus. Being debt-free or nearly so feels much better than any driving experience exhilirates or any gourmet meal could possibly taste. Max out your retirement plan, put your wife on salary and do the same for her. We lose 1-2 doubling cycles on our investments due to entering the workforce later in life.
BTW comrade, I'm not trying to preach at you. I simply figured that you're recently out of training and wanted to impart some of my painful experiences to you so that you could avoid the same. <img border="0" alt="[cheers]" title="" src="graemlins/beerchug.gif" />
04-05-2003, 12:00 PM
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Thanks A.J., I appreciate the insight. It's just frustrating to know how many years of work I have put into getting where I am now. Thank you for your advice, it's nice to have people who have travelled the road before me to give some valuable advice along the way.
04-05-2003, 06:29 PM
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Hey Doc,
What about a slightly used turbo. Some are selling for low 80's. Even with tier 2 credit your payments should still be significantly less than a new Turbo. In fact, since you are looking to finance the M3 convertible, a used turbo isn't that much more than a new M3. Also I think a used car won't depreciate as quickly as a new car. So if your not leasing and instead financing then a used turbo mught be a better value than a new M3 convertible.
Obviously all this assumes you don't mind driving a used low mileage car. Some people will only lease/buy new.
If you are worried about warranty, you can purchase an extended warranty pretty cheap while the car is still under factory warranty.
What about a slightly used turbo. Some are selling for low 80's. Even with tier 2 credit your payments should still be significantly less than a new Turbo. In fact, since you are looking to finance the M3 convertible, a used turbo isn't that much more than a new M3. Also I think a used car won't depreciate as quickly as a new car. So if your not leasing and instead financing then a used turbo mught be a better value than a new M3 convertible.
Obviously all this assumes you don't mind driving a used low mileage car. Some people will only lease/buy new.
If you are worried about warranty, you can purchase an extended warranty pretty cheap while the car is still under factory warranty.
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04-05-2003, 08:23 PM
#8
Dr. G,
There are alot of advantages to leasing, despite what some people here are telling you. I would never pay cash for a depreciating asset. One thing that you must consider as well, is what the money you would have paid for the car could earn in other places, such as real estate, rental property, equities,etc. Also, some leases are tax deductible depending on your situation. Good luck..you will love the M3!!
There are alot of advantages to leasing, despite what some people here are telling you. I would never pay cash for a depreciating asset. One thing that you must consider as well, is what the money you would have paid for the car could earn in other places, such as real estate, rental property, equities,etc. Also, some leases are tax deductible depending on your situation. Good luck..you will love the M3!!
04-05-2003, 09:05 PM
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</font><blockquote><font size="1" face="Verdana,Tahoma,Helvetica">quote:</font><hr /><font size="2" face="Verdana,Tahoma,Helvetica">Originally posted by A.J. O'Connell:
<strong> The second learning experience was in a lease/purchase of my office computer system- $42K for a $22K system, big prepayment penalties, and if I had any legal fight with the company it was a moot point because the small print in the lease contract had me agree to legal venue in California. </strong></font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Helvetica">Always read the fine print...
(leasing company guy from California and yes all of my docs [documents, not Doctors] have venue in California. Truth be told, sometimes venue does not hold up depending on the State of the Lessee)
<strong> The second learning experience was in a lease/purchase of my office computer system- $42K for a $22K system, big prepayment penalties, and if I had any legal fight with the company it was a moot point because the small print in the lease contract had me agree to legal venue in California. </strong></font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Helvetica">Always read the fine print...
(leasing company guy from California and yes all of my docs [documents, not Doctors] have venue in California. Truth be told, sometimes venue does not hold up depending on the State of the Lessee)
04-05-2003, 10:56 PM
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Doc-
Am lucky enough to own both TT X50 and M3 (coupe with SMG). The M3 is a totally different driving experience from the TT but a fabulous car. On a dollar-for-dollar basis, it would be hard to beat. I highly recommend the SMG option.
Off topic, Testndoc above is right on the nose regarding the desirability of business leases in certain circumstances. When in doubt, do as your patients do:Consult an expert (ie:CPA with expertise in the healthcare area).
Am lucky enough to own both TT X50 and M3 (coupe with SMG). The M3 is a totally different driving experience from the TT but a fabulous car. On a dollar-for-dollar basis, it would be hard to beat. I highly recommend the SMG option.
Off topic, Testndoc above is right on the nose regarding the desirability of business leases in certain circumstances. When in doubt, do as your patients do:Consult an expert (ie:CPA with expertise in the healthcare area).
04-06-2003, 09:46 AM
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Hey doc,
Regarding what I said in my previous post, you probably don't even need to get a turbo that is selling in the low 80's. I bet a 2002 with low miles in the mid to upper 90's would still have lower payments using tier 2 than a new turbo using tier 1.
In regards to putting money down, I don't understand the objection. Usually on a three year lease, for every $1000.00 you put down your payments should go down about $28.00. So if you put an extra $15000.00 down then your payments should go down by about $420.00/month. You end up paying $15000.00 now but you save 420/month times 36 months = $15120.00 over the term of the lease. It all evens out.
Regarding what I said in my previous post, you probably don't even need to get a turbo that is selling in the low 80's. I bet a 2002 with low miles in the mid to upper 90's would still have lower payments using tier 2 than a new turbo using tier 1.
In regards to putting money down, I don't understand the objection. Usually on a three year lease, for every $1000.00 you put down your payments should go down about $28.00. So if you put an extra $15000.00 down then your payments should go down by about $420.00/month. You end up paying $15000.00 now but you save 420/month times 36 months = $15120.00 over the term of the lease. It all evens out.
04-06-2003, 12:05 PM
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Dr.G,
As an MD "I feel your pain", in the words of Bill Clinton, I too lived like a bum on credit cards during my residency. But now I'm about 7 years out and the best advice I can give is pay off all your consumer debt, if you haven't already, and get yourself a private banker. Our group uses a private banker and it has really made life easier for me, big ticket items like cars and mortages are literally a phone call away. Why do you want to lease anyway? If it's a car you may keep then go ahead and buy it or finance it with your bank, the rates are very low right now.
AJ,
what's your specialty? I'm in gas down here in Houston, hoping to get into a TT real soon myself.
As an MD "I feel your pain", in the words of Bill Clinton, I too lived like a bum on credit cards during my residency. But now I'm about 7 years out and the best advice I can give is pay off all your consumer debt, if you haven't already, and get yourself a private banker. Our group uses a private banker and it has really made life easier for me, big ticket items like cars and mortages are literally a phone call away. Why do you want to lease anyway? If it's a car you may keep then go ahead and buy it or finance it with your bank, the rates are very low right now.
AJ,
what's your specialty? I'm in gas down here in Houston, hoping to get into a TT real soon myself.
04-06-2003, 10:20 PM
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</font><blockquote><font size="1" face="Verdana,Tahoma,Helvetica">quote:</font><hr /><font size="2" face="Verdana,Tahoma,Helvetica">Originally posted by Dr. G:
<strong>Is this commonpractice amongst dealers? Shouldn't the dealer have known based on our initial Tier 2 status that I would need to put more money down with Tier one approval? </strong></font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Helvetica">Hi Dr.G,
I'm not sure about the two tier thing, but it makes sense about being approved for a fixed amount. When I bought my last car, I would only be approved for 0% financing for a certain amount, that raised my down payment, but it was worth it.
Smart move not putting down lots of $$$ on a lease, granted it lowers the payment, if the car is stolen or totaled you may never see that money again.
The M3 is a terrific car, enjoy it!
Best regards.
<strong>Is this commonpractice amongst dealers? Shouldn't the dealer have known based on our initial Tier 2 status that I would need to put more money down with Tier one approval? </strong></font><hr /></blockquote><font size="2" face="Verdana,Tahoma,Helvetica">Hi Dr.G,
I'm not sure about the two tier thing, but it makes sense about being approved for a fixed amount. When I bought my last car, I would only be approved for 0% financing for a certain amount, that raised my down payment, but it was worth it.
Smart move not putting down lots of $$$ on a lease, granted it lowers the payment, if the car is stolen or totaled you may never see that money again.
The M3 is a terrific car, enjoy it!
Best regards.
04-06-2003, 11:48 PM
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Throughout this whole experience my leasing/buying agent never mentioned the "Porsche Options" program. He did mention that, in general, a financing situation was looked upon more favorably than a lease from the financial institution's standpoint. In fact, he said it was easier to get a mortgage than an auto lease (I don't know if he was just trying to make me feel better). Anyone have any information about this program?