so would a 1000 dollar total drive off (including license and so on) and a 360 a month payment including taxes be a good deal? i dont want to buy this car, after 3 years i hope to get a 2004-06 e46 M3 since i love that car, hopefully the e92 M3 is a monster and makes the value of e46 m3s go down enough for me to afford one without being broke every month.

i have a few questions, what is the money factor? does it calculate the payments? or what?

also the residual will be calculated on the msrp of 33k? so why does it matter they are selling it for 29800? can someone explain this to me, i dont trust the dealers explanaitions.

and finally, does anyone know a dealer that has any rio yellow or new formula red S's in stock? i dont any kind of silver unless it has the black and red interior.

thanks again for everyones help, you guys are really nice lol

 

one more question, about insurance this time. i am 18 about to turn 19, now i can afford the cars payment easily, but i cant afford a 300-400 dollar a month insurance payment, so my sister is going to lease the car for me, she lives in Los angeles, i have been driving for 2 and a half years and have had no accidents or anything, but i do have 2 speeding tickets, and strangly enough they were both given to me in my moms accord and my dads element lol not my type-s.

now she is going to be the insured driver, but i will be driving the car, if anything ever happens, god forbid,we will just say i was borrowing the car and i will covered, but she is tried up with a loan with her credit union, and says she cant sign until her deal goes through. i can wait, but i really dont want to bother her with signing papers and so on, so my question is, if my dad leases the car for me in his name, but my sister insures the car, will i be covered in an accident or something? or since i live with my dad the owner of the car, will i not be covered? i should ask an insurance agent, but i am not too sure of the legality of this, but hey its seems ok to me.


thanks again

 

check your insurance policy.

in some states, if you borrow a car and damage it, the liability is on the OWNER. In others, it is on the DRIVER. It is too risky to have your sister insure it; it is less risky to have your dad do it as you are in the same area and household.

In some policies, if you don't live in the same household as the insured, it is not covered (you don't live with your sister and even if you did, it would not be considered the same household as she is technically a roomate).

What you are inquiring on is essentially insurance fraud. When you insure a car, you pay for your risk and it is pooled. What you are trying to do is pay for a lower level of risk than you are truly presenting to the insurance pool. Some agents will look the other way, some won't.

Now, even if your agent is OK with this, if your insurance company ever suspects that you are in fact the primary driver of the car, they can deny the claim. If you wrecked the car where you live (not LA) and they notice it is your sister's policy from another area, a claims investigation will likely be flagged.

Be very very very careful what you do with insurance. Your agent is only concerned with $, not your well-being; he could give a rats ass if a claim is denied. If the insurer gets wind of it, you could be stuck with a worthless wreck of a car, owe money on it, and possibly face a fraud charge.

 

There are two components to a lease payment. Well, three if you include sales tax. They are depreciation and interest (sometimes called rent)

The depreciation is calculated by subtracting the residual value (based on MSRP) from the price you are actually paying for the car. This number is then divided by the number of payments to get the monthly depreciation.

The money factor is simply the interest you are paying on the depreciation. If you multiply the money factor by 2400 you get the interest rate. For example, 0.0008 x 2400 = 1.92% interest.

Here is an example with the Honda lease deal with a residual of 59% and money factor of 0.0008. All values rounded to the nearest dollar. I added the acquisition fee into the actual price.

33665 x 0.59 = 19862 (MSRP x residual% = residual$)

30595 - 19862 = 10733 (actual price - residual = depreciation)

10733 / 36 = 298 (depreciation / number of months = monthly depreciation)

(30595 + 19862) x .0008 = 40 (actual price + residual x money factor = interest)

298 + 40 = 338 (depreciation + interest = payment)

338 x 1.0825 = 366 (payment x tax rate = total payment)

Note that with a lease you are only paying interest and taxes on the depreciation. I'm not suggesting that all leases are good deals or that leasing is for everyone, but in a case like this with a high residual and low money factor it really makes sense.

It's like a 3 year test drive. If you decided to keep the car you just give them the residual value and the car is yours. I've even heard of people negotiating with the dealer to lower that price when the market value of the car is less than the residual value.

If you don't want to keep the car, just give them the keys and walk away. Simple as that. Of course they check the condition of the vehicle, but I returned my 95 MX-6 with a cracked windshield and they never mentioned it...

 

You can't negotiate with the dealer; they don't own the car.

you negotiate with the leasing company. The dealer is NOT an agent for them.

 

just me. but

new+lease=450/mon..... u have to guve back (no liquid asset)


used+buy=450/mon......its urs when done and u can sell as a liquid asset..

hmmm

 

steven975, thank you for the help.

 

Last time I checked, the dealer is an agent for the leasing company. Remember, the dealer wrote the lease and the dealer accepts the car when the lease is over. Oh, and I think American Honda Finance might just be affiliated with American Honda.

Normally either the finance company wholesales the car after the lease return or the dealer is given the option to add it to their inventory. If they know the wholesale value of the car is less than the residual, why not sell it to the original client for a value between the two. They make more money and they have a happy customer...

 

Pulled the trigger today. White/black top/tan interior. The car was available at the nearest dealer, and I didn't feel like running around to try and squeeze the last dime out of the purchase price. Price before taxes, tags & registration was $30,500. Would have bought at lease term end anyway, so I paid cash and took title. What a pure sports car!

 

Welcome, RainMeister! Use it in good health! Cheers...