How to negotiate a car lease (step-by-step)

Took forever to get the video started

The intro lolol

Extremely helpful

Focusing on the purchase price can also be irrelevant.

There are many variables that will get you the total cost of the lease:
- what depreciation schedule is the dealership using on the car - they have their own made-up depreciation lease schedules which are only designed for profitability, and have no correlation with actual car depreciation
- money factor which was discussed here - the higher your interest rate, the more you pay. And, this also has very little to do with your credit. The dealers make these up depending on the length of lease and model of the car. It's purely designed for profitability.

I went to a Subaru dealership yesterday and had all of my numbers prepared. I was expecting a $280/mo payment as a good 'middle-ground'. They wrote out $479/mo" on a piece of paper.

Not only were they using a hiked up MSRP / sale price, they were using an incredibly high depreciation schedule (40% over 3 years) when the car I was looking at depreciated 38% over 5 years historically. While they offered a decent money rate (converted to like 2.5% interest), the other two factors made it impossible to make the numbers justifiable.

Even if you significantly lowered the sale price, if the depreciation schedule is completely out of whack, they're going to make a massive profit and your monthly payments will be sky high, because they're pretending the car is rapidly losing value, so you are making up for that with a higher monthly payment. Even if you feel you got a great sale price, if they are factoring crazy depreciation, they will make up for it.

Do not completely ignore monthly payment - it should be the mark you use based on your budget, and it will be calculated based on the three factors above (purchase price, depreciation schedule, and money factor). I am using 0 down for simplicity. Good luck out there.

Please explain why they say there is a certain amount due at signing? Is that the same as the down payment. ?

So, I am here studying how to negotiate a lease because this market is absolutely nuts. I'm commenting in 2022. This was made in 2020. I went to three different dealerships to see what is being offered. I go in low balling so I can have something to go up from, and they're almost not willing to even negotiate. I went into a Kia dealership and the guy was--patronizing the hell out of me, woman here--and not even showing me any new cars even though I said I wanted to lease. They are push-push-pushing the used cars because they're selling used with almost 50k miles on it for the same price as what a used car normally is. They're totally looking to take advantage of people by having them buy these cars they're get maybe $10k for, for $20k. It's ridiculous.

I'm getting the feeling that car salesperson is becoming a dying career. I could be wrong, but it feels just on the horizon. No one wants to deal with this backhanded, non-transparent, dishonest shady negotiating where the salesperson is trying to take advantage of the customer. Which is pretty much acknowledged in this video. They're trying to get the most money out of you. In a market like this, where the negotiations are barely even on the table anymore, it's exhausting. It's exhausting in the best of times to duck through all the hoops a salesperson is working to make someone get through so they can get a decent deal, but now...it feels inexcusable.

We're becoming an ever-changing, ever-moving, faster paced than ever before society. I can see a future where cars will be the price they are and these dealings won't be an issue. Honestly, I sort of can't wait for it.

It was mentioned that you should not put any money down...does this also include a trade in?

I'm still confused... What should the money factor be?

Great advice

true ball fan right there

This is what you need to know when you lease a car ata leade dealership baby

I was told by a Chevy dealer that GM sets the money factor for my lease deal and cannot be negotiated. Money factor is .00206. Any truth to this?

Can you get pre approved though a credit union for a lease so than you will know all those rates ahead of time ??

I just went to 4 dealerships and the all wanted 14k down payment on a lease so I could pay 350mo on a car that 45k including the markup with a rate of 5%. I founded that crazy I have never had to put such amount down for a lease. Any advice on that? For my next dealership visit. Thank you for all your videos.

If a dealership refuses to disclose the money factor is that a massive red flag to get up and leave or is it so normal in the industry to not disclose its just something to work around?

In a purchase one can get a lower interest rate from a bank or credit union instead of the dealer rate but what about the money factor on a lease. Is it negotiable or is fixed by the dealer / manufacturer? So if one obtains the buy rate and money factor from the dealer is it all for naught?

What about the acquisition fee on a lease? Is it negotiable?

You guys are GREAT!!!

Last year I went to Nissan Universal city dealer in Los Angeles and the cars were marked up $4K and when I got their offer for the car, it had a $2 k charge added on top, when I asked about it, they said it was a paint gloss to keep the car looking like showroom car, that it was from the factory and couldn’t be taken off. At that point I walked out.

I know the goal is to negotiate a final sale price, but what do you do if the dealer marks up Money Factor? Would it be reasonable to try to negotiate a discount off MSRP and also ask for MF discount, or try to ask for a particular final monthly cost? Reason I ask is because I'm hearing some dealers will agree to bring down a marked-up MF and give fewer discounts off MSRP, while other dealers will not budge on lowering a marked-up MF, but agree to give larger discounts on the sale price.

someone came off the highway and total my parked car. I was so stressed out when I found out that there is no new cars out there due to the chip shortage, and if there is, it is between 2.5k to 5k over msrp. THANKS for the VAA website, now I know I can fine another car. YOU ARE THE BEST!!!!!!!!!!!!

Hey guys, I’m very impressed with your videos, and I even signed up for YAA…but I know how much my current cars is worth. I need help with the lease of a 2023 BMW X3 xDrive30i…fully loaded 61K or the X3 Zm40i at 71K.
Don

How deposit is totally lost if the vehicle is written-off? You cannt bring the vehicle on the road without an insurance. You are covered to get the replacement value of the vehicle. You do not earn the interest rate % on cash sitting in your bank vs. the interest rate leasing company will charge.

Just go straight guys instead of trying to be funny would be best.

What if they pressure you to put money down?

Are they required to tell you the money factor?

This must be an OLD video, negotiating below MSRP does not or rarely occurs in 2022!
However if you get a leased car at MSRP, it is likely to work out due to the massive demand destruction that's about to take place in the used car market.

Wow.. eye opening.. I can see I have a lot of homework and research to do. Thanks, guys

OKay you can do zero down. But "Due at signing " is mandatory ?? and also can I roll fees into my monthly payment ?

OK, I understand that the "money factor" is equivalent to the interest rate you would be paying on a loan if you bought the car... So, I'm just figuring that this money factor is part of your monthly payment...So, if you were able to negotiate the money factor down, your lease payment would go down a bit... I don't understand the part about multiplying by 2400 though. Doesn't that number depend on the length of the lease? Two year would be 2400, three year 3600, etc.

SUPER informative and helpful. I'm considering leasing a car for the first time. Now, I'll be armed with some "intelligent questions" to ask about the lease t&c's! Thank you! Gene

Need to do a mock lease deal with a pretend dealership and go thru all the chess match on leasing a car

I thought I was watching a Scotty Kilmer video at the intro 😂

what is the 2400 from the money factor to interest rate? IS the different between the buy rate and the money factor the profit the dealership will make on the lease?

Why did the kid interrupt while he’s talking numbers ?

The only way to win is buy the car loaded at 4 yrs, P.O quickly and hold 10 years by hybrids for the future book values.

So, is the money factor negotiable? I still don't understand what the "buy rate" is.

You guys mentioned the money factor and then buy rate. Are those one in the same?

What about acquisition fee? Learning the shell game, great info

My elderly parent wants to lease. If gap insurance covers total loss and car insurance covers repairable accidents, how does that affect the end of lease? I'm worried about being charged for damage "above and beyond" normal wear and tear. I read somewhere that in the case of an accident, the car must be repaired where the lease company states. I'm guessing we would still be responsible for monthly lease fees during the repair time (the last accident the car was in the shop for a few months) Would a lease be a bad idea for someone with a higher risk of accidents?

Im just watching this now. I understand the concept of the Money Factor but not the buy rate. Are you saying the buy rate is what lease company gets it for? The Money factor can be increased by the dealer to gain more profit?

Thank you ❤️

Love your videos. I was thinking of leasing a 2025 CRV Sport Touring Hybrid. The lease on my current SUV expires in March 2025. However, since there are no changes from the 2024 model, I would think I could get a better deal on a 2024 model...assuming there are some available in my area at that time. Thoughts?

I tend calculate the monthly payment (Final adjusted price-residual-down payment)/36. This should be roughly monthly payment before tax and interest.

Thank you for the video. i never had a car and interested to lease a car. Which I know nothing about. Do you know for personal advisor that I can contact? Thank you.

boring

Hello,
Is the money factor & the apr the same thing?
Thanks 🕊

Is the buy rate the same thing as the dealer invoice?

Guys, great videos. Can I just make a request? And maybe others would agree. Can you do a video where you explain how to apply the money factor??? You discuss what a money factor is and how to figure out a percentage rate (multiply the money factor by 2400). But you never do a calculation to show how you then apply this money factor. Thanks.

With no money down does this not include trade ins? Do you take all the cash from trade in or do you put it towards the lease to get a lower payment?