buying a new lr4

[Finlayforprez]

Don't worry at all... This is the place to type out your thoughts and discuss the options. I am the same way! I have appreciated this discussion, as I am in a similar situation.

 

[manoftaste]

Been a while since i posted anything, but have been reading, enjoying, and benefiting from the threads for sometime now as the day of taking the delivery of my new LR4 approaches (custom order, lux, HD, vision assist, sirius, & RSE.)

Dealer opted for no deposit at the time of order mentioning no obligations, and no price was set either. I havent brought it up yet to the dealer but may want to trade in my 2006 LR3 HSE (with relatively less miles) if offered good value, but not sure how to bring it up without being taken advantage of (to their credit, dealer seems very nice and honest person, i am just being protective). Any advice from the experienced ones would be greatly appreciated. Also, does it help in negotiating (or even matter) if you buy it right out without financing? Many thanks.

Would greatly appreciate any advice on above, thanks.

 

[horatio8]

Horatio8,
Thanks, I appreciate the tips. So, looking at the current lease deal, we have the following:
msrp: 55,475 (but i believe they market adjust it down to 53,752, which is the # I use in the calculation)
term: 39 months
cap reduction: 3,000
purchase: 28.4k
payments: 699
all numbers without taxes or licenses.
By my read, that equates to @3.85%. Does that sound rate? Current 5 year rates are anywhere from 1.9 to 2.9% (at least based on what i can find). Not quite the spread that you encountered...this one is a bit closer.

So, I guess it comes down to this:
If I lease, I pay a point more, but 12k less down, for the same monthly payments. I am overpaying on the depreciation, but i can make that up by buying the vehicle if in 3 years the purchase option is substantially less than market value...like it is now. So, how much is putting 12k less as a down payment worth to me? Suggestions? I probably will drive it around 10k a year, not much more, if any, but I never turn a car over within 3 years...but if the diesel came, and it met my probably unrealistic expectations, I would flip the car.

I did tie out to your #s before tax (although in most states your monthly payment includes tax based on the amortized amount). 3.85% is not too bad, but I would check the web to make sure that's the bank rate and not marked up by the dealer (I'll try to post some good links later). I also would push for that rate without doing the $3,000 cap reduction for the reasons I mentioned earlier. Here are my calculations (I can send a spreadsheet with the formulas if anyone needs it):

MSRP $55,475.00
Neg. price $50,752.00
Residual % 51.19% Residual $ $28,397.65
Usage $22,354.35
Months 39
Montly usage $573.19
Money factor 0.001604167 Rate 3.85%
Interest $126.97
Pre-tax $700.16
Tax rate 0.00%
Tax payment $0.00
Total payment $700.16


Rate 3.85%
Money factor 0.001604167

Residual $28,400.00
Residual % 51.19%

As far as not putting down the 12k, unfortunately interest rates are very low, so you won't earn much on it - but it's still nice to have in case of emergency.

 

[bromhead]

So, buyback offer came in from Chrysler...very fair. I can now move forward! Unless I get lucky on inventory, my guess is I will be preordering. Need to find out cutoff/open date for 2012/2013 models.

You are right though, unless i take a bit of risk, I am not really going to earn much with the 12k. And you point about cap reduction on the lease is well noted. Leaning towards buying the car now.

I really comes down to being able to afford to drop the extra 12k down. By doing so, I save 1-1.5% on the interest rate. When the residual is so low, I am not sure you really have the flexibility you think you have with a lease. By turning the car back in, with such a low residual, you have essentially overpaid for the use of the car. So, if you have to buy it/flip it anyway, how is the lease really any more convenient...except, of course, that you can postpone that additional 12k downpayment...

Oh, well, time to now find a car! Thanks for everyone's help!

 

[Finlayforprez]

So, buyback offer came in from Chrysler...very fair. I can now move forward! Unless I get lucky on inventory, my guess is I will be preordering. Need to find out cutoff/open date for 2012/2013 models.

You are right though, unless i take a bit of risk, I am not really going to earn much with the 12k. And you point about cap reduction on the lease is well noted. Leaning towards buying the car now.

I really comes down to being able to afford to drop the extra 12k down. By doing so, I save 1-1.5% on the interest rate. When the residual is so low, I am not sure you really have the flexibility you think you have with a lease. By turning the car back in, with such a low residual, you have essentially overpaid for the use of the car. So, if you have to buy it/flip it anyway, how is the lease really any more convenient...except, of course, that you can postpone that additional 12k downpayment...

Oh, well, time to now find a car! Thanks for everyone's help!

Awesome! Keep us posted!

Can't wait for you to get your LR4.

-David

 

[horatio8]

FYI - this is from an Edmunds forum. It appears that the rate from Chase is 2.85% (.00119 x 2400), which means the dealer made 1% pure profit on the back end of your deal, or about $32 a month. It might be that LR4s are in short supply and it made sense to grab the deal, or maybe you could've bargained a touch more. Bottom line, it is important to be armed with all the information when you negotiate a lease.

#80 of 80 Re: Lease info on LR4 [epack] by Car_man HOST
May 07, 2012 (4:43 pm)

Replying to: epack (Apr 30, 2012 5:41 am)

Hi epack. Land Rover's May buy rate lease money factor and residual value for a 36-month lease of a 2012 LR4 HSE with 10,000 miles per year are .00119 and 53%, respectively for consumers who qualify for its top credit tier.

The residual value for a lease with 12,000 miles per year would be 1% lower than the 10k residual. The 15,000 mile per year residual value would be 2% lower than the 10k residual.

Car_man
Host
Prices Paid: Buying & Leasing Experiences Forum

 

[bromhead]

Thanks for the feedback Horatio. and David I actually haven't made the move either way yet. I am having trouble finding right vehicle. They do seem to be in short supply.

 

[alexcorral]

Got it. Due to the cost of diesel fuel however, economically is there much difference running a diesel engine versus a gas engine? And aren't gas engines "cleaner" environmentally speaking in terms of emmistions even though the new diesel engines have come a long long way?
I almost pulled the trigger on an Audi Q7 TDI before I got the LR4, but I wasn't impressed with the vehicle as a whole. Nothing to do with the engine though.

In Panama Diesel is cheaper than Gas which makes it even better