'16 Lease Residuals (not for everyone, I know)

Lease it, grind it, then buy it!!

 

Dealers DGAF if a car is leased or financed; they get their holdback either way, and they can and do mark up the APR either way. The selling price is negotiated under the exact same constraints either way. I've always paid invoice or below on my leases, which is a very important part of the equation: Every dollar you negotiate off the selling price saves you ~$3 over the course of the lease.

There is a large segment of the public that thinks leases are some kind of Ponzi scheme or something; it's fundamentally the same as financing, except the lender is incurring the depreciation downside risk instead of the buyer. The buyer pays a fee (bank/acquisition fee) for this risk reduction. Your car depreciates either way, with a lease the depreciation rate is just negotiated up front. You still retain the upside if the vehicle depreciates slower than the lender predicted, since you can cash out positive equity on a lease at any time (same as with financing).

Sure, you can get fleeced on a lease, but you can get fleeced on financing just as badly (if not worse). Informed buyers can come out ahead by leasing in many scenarios:
-Small business owner
-Prefer to always have a vehicle under warranty
-The vehicle is later involved in a collision (if owned/financed, any collision severely cuts your equity; if leasing, you only pay the insurance deductible)
-They invest the extra cash flow from leasing vs. financing
etc etc

If you drive your vehicles for a decade and 200k miles (and/or modify the hell out of them); then no, you are not a candidate for leasing. Doesn't mean that other people with different circumstances are automatically idiots for leasing.

 

Just went to the dealer about a limited DCSB 4x4. 70% residual after 36 months, 12k miles a year. Wouldn't budge on $1000 off MSRP which was $40020, claimed invoice was $37607. The difference between invoice listed on the forums and what he had on paper was $500 TDA fee. I tried telling the dealer I wasn't going to pay it, and he wasn't having it. Also didn't seem very responsive to the MSDs and asked me what they were at first. Woof...

 

I have a near-relative that does sales for Toyota so I start with him. In most respects, I like to think he shoots straight with me. I told him last week that I would likely pay down MSDs and he grimaced. I'm going to work with him in December or so. He said they would more likely budge from MSRP then. I'll also use the lone Costco dealer (which is not where my "relation" works) as a gauge. The thrill of the hunt!!

 

If u don't mind me asking what are your payments per month and what down

 

I'm also very interested in what people have negotiated for their leases. Also, are residuals negotiable on leases?

 

No, residuals are NOT negotiable on leases. They are a set value. On the bright side, it is one less thing that one has to haggle over... lol

 

IT supposed to be in stone but a Honda F&I guy tried to raise my residual $1000 while leaving everything else the same. I don;t know why as they get paid for the vehicle. Maybe he added $1000 to make another grand on the back end, But I read EVERY LINE of that L O N G buyer's Contract as well as the back. I am in F&I for over an hour.....

I threatened to walk and they dropped it to my original figure and somehow lowering it lowered my monthly as well. We lease the wife's 14 CRV EXL NAV Lease is $327 w tax with $17800 residual on $29,000 Cap cost After a year we are $1000 ahead of "Good" KBB Trade. I expect we will be in a profitable equity position six months before lease is over. We will buy and sell the CRV and lease another, Leasing is a MUST UNDERSTAND as there are no APR rates listed. We lease here because she is a self employed musician and works nights and I always want her in a new (deductible) car. Me I have to find things to do and places to go everyday and I have a Miata and a TRD coming How stupid is that?

 

Has anyone used the 1 Pay Lease option? It sounds kind of nice, pay a chunk of change upfront and not have any payments for the lease term while saving to payoff the rest during that time. Any thoughts on this?

 

One-Pay leases are fine as long as you are getting a significant Money Factor reduction in exchange. Some unscrupulous dealers just take your money and charge you the regular payment x36 months or whatever. Whenever I've investigated it, MSDs worked out to a better than 10% annual return on investment, while 1-pay was less than 5% (on a larger chunk of money, however). Still beats earning 0.01% in a bank account, but much lower than that and I'd probably just take my chances in the stock market.

Last I checked, TFS One-pay is a 0.001 MF reduction, while you can do up to 9 MSDs for a MF reduction of .00072. In other words, the One-pay costs you 4 times as much cash up front for only an additional 39% MF reduction.

I view One-pay as a viable option mostly for manufacturers that don't offer MSDs (VW, Honda, etc).

 

37.5 sticker 319 per month 36 months 12k per year. Bought the truck for 33.5 k no money down other than 500 toyota rebate from flood damage car.

 

$4k off sticker? You work at a dealership or something? Killer lease

 

Still pissed could have been lower payments. No but this is 5th Tacoma lease since 2000. Very high residuals make lower payments. Gotta know the facts before you go in. You gotta figure most people see 400 on a 37.5k truck and go with it....I worked this deal hard.....made a deal at one dealer for an inferno red they could not sell.....decided it was to orange so I took the deal to another dealer. They had same truck in silver and gave me same deal plus 500 more off!!!!SCORE

 

Problem with that is if your truck gets totalled......They have all your money...Just another bush to take out of the way,

 

I just leased my new Tacoma. 3yr/36k miles, $1250 due at signing and my payments are $239/mo. I work for a Toyota dealership and I ordered the exact truck I wanted. TRD Sport with manual transmission which also happens to have the highest residual percent. The residual percent was 84%, so over 3 years i am basically paying the 16% depreciation. That is why my payments are so low. If the average Joe walked in, their payments would probably be closer to the 300-325 range. Which in my opinion is an insanely low payment on a $35k truck.

 

Thanks for your insight!

 

319/month/12k per year 36 month lease
37k + sticker 300 sales tax 499 dealer fee 42 liscense transfer fee.
Walked out 33038 after put 500 cash and 500 flood rebate

I've had 5 tacos all leases.....the previous four exited early
2001 access cab 4wd 215/month no $down 48 month lease

2004 double cab pre runner 225 48 month lease no money down

2005 2wd double dab TRD sport 245
No money down

2012 4wd TRD sport 38 k sticker no money down 315 month 4 yr 15 k yr

 

Dealer or not. I call BS on 84% residual for 3 years. Post your deal sheet.

 

Go to your local Toyota dealership and ask them what the residual is on a 7543. all the info is from ALG. I am in Southeast Toyota region. If you are in Las Vegas, your info is provided by Toyota Financial Service but the numbers shouldn't be any different. You can believe me or not. It is what it is.

 

One-pay leases go into an escrow-type account. If your car is totaled, your insurance sends a check to TFS and they send you the balance of your escrow account, minus any equity gap (not applicable if you had gap insurance).

Don't confuse one-pay leases with cap cost reduction (i.e. money down). That money is indeed lost if your vehicle is totaled.

I'm also skeptical, but the math on your payment works out with that residual. I'll check on Edmunds; they have sources for current residual info. Is the residual also that high for 7545?