[T-Type]

I have some lease questions that I hope some of you can answer. Let me say I did try to ask at my dealer first, but the answers were not satisfactory. The person didn't seem to be very knowledgeable.

My current 2014 Volt lease is up in June, however the dealer is offering to end the lease early to get me into a new car. The impression they gave me is I wouldn't have to worry about my last few payments but I have my doubts. Does GM eat the payments? Or will they just sneak it into the new lease (if I do it)?

I'm looking at a 2017 LT with just leather and heated seats. Their initial lease offer was I would pay the same amount per month as my current lease. I pointed out that my old loaded Volt was comparable to a current Premium and the LT would be several thousands cheaper. After a little while they dropped their offer by $40 per month. I guess where I'm going with this is how do I find out if I am getting a decent deal?

 

[firehawk72]

I have some lease questions that I hope some of you can answer. Let me say I did try to ask at my dealer first, but the answers were not satisfactory. The person didn't seem to be very knowledgeable.

My current 2014 Volt lease is up in June, however the dealer is offering to end the lease early to get me into a new car. The impression they gave me is I wouldn't have to worry about my last few payments but I have my doubts. Does GM eat the payments? Or will they just sneak it into the new lease (if I do it)?

I'm looking at a 2017 LT with just leather and heated seats. Their initial lease offer was I would pay the same amount per month as my current lease. I pointed out that my old loaded Volt was comparable to a current Premium and the LT would be several thousands cheaper. After a little while they dropped their offer by $40 per month. I guess where I'm going with this is how do I find out if I am getting a decent deal?

Sorry if this really comes off as brash, but learn how to calculate a lease. There are many factors that goes into what makes a good deal an actual good deal (market, price, incentives, so forth). If you don't know what a good deal is, then you simply can never get a good deal.

 

[mpmoore1979]

There is a agreed upon price for the car that the lease is based off of. You need to find out what that price is and then fond out what others have paid for the same car/options. If the agreed upon price is high, your lease payments will be higher. Also there are some programs GM offers to end your lease early or they may try to sneak in the extra payments as some kind of option. Make sure they give you a break down of all costs on paper such as the price for the car, any other options and rebates so you can see were the money is going.

 

[Bacardi]

To answer with ending a lease early, confirm with your LENDER...They're usually called "pull ahead offers" but a shady dealership could claim they'll offer it and roll it into the lease...

With everything else, I agree with Firehawk...

 

[T-Type]

Man rough crowd. If I was a leasing expert I wouldn't be posting.

Anyway thanks for the tip to check with my lender (Ally). If there is no pull ahead offer, I'm done.

 

[jupitermoon]

Man rough crowd. If I was a leasing expert I wouldn't be posting.

Anyway thanks for the tip to check with my lender (Ally). If there is no pull ahead offer, I'm done.

Yeah it is a rough crowd and very unnecessarily so. It seems people here get a kick out of slamming others who have legitimate questions or are new to the scene. Truly ridiculous.

Anyway, I've a lease calculator that's relatively simple to use. A few manufacturers do absorb the last few payments and waive them for you but Chevy/GM isn't one of them. So they would simply add your remaining payments to your new vehicle.

I think I got a very good deal on my LT with leather and bose and heated seats. If you wish, I can refer you to the person who sold me the car. Just private message me.

 

[Bacardi]

No numbers were mention, not the payment, not what "several thousand" means and that may not even be a hard offer...Then we need to know if the OP resides in a carb state...

There are targeted incentives, including one that gives you $3000 off...All and all, a DTLA dealer is claiming ACC equiped Premier for $0 driveoff and $233/mo over 35 months assuming you qualify for the $3000 off incentive...Fremont in norcal often has an even better price...

 

[DonC]

The best approach is to skip all the "same payment as your existing" stuff and just run the numbers on a new lease. That's pretty much done by taking the purchase price (not the MSRP but the actual price you pay), subtracting the residual (which is based on MSRP), subtracting any down payments (called cap reduction), subtracting any discounts (often called lease cash), and dividing by the number of months in the lease. That will be low because it leaves out interest and the acquisition fee, plus of course taxes, but it should give you a starting point. Note the residual is set by the lessor and will vary by how many miles are included in the lease and whether you're leasing an LT or a Premier.

Note that every dollar you negotiate off the purchase priced reduces your payment by 1/36, which means the starting point for negotiating a lease is negotiating the purchase price.

Trying to negotiate a lease by negotiating the lease payments is a sure fired way to get taken advantage of. Ask the dealer for the details. If you get these numbers from a dealer and post them here, people will be able to comment on whether they think the deal is "fair".

Sorry if this really comes off as brash, but learn how to calculate a lease. There are many factors that goes into what makes a good deal an actual good deal (market, price, incentives, so forth). If you don't know what a good deal is, then you simply can never get a good deal.

This. Otherwise they kill you with obscure calculations which you can't follow.

 

[llninja]

Yeah it is a rough crowd and very unnecessarily so. It seems people here get a kick out of slamming others who have legitimate questions or are new to the scene. Truly ridiculous.

Hey, I resemble that remark.

Seriously, unless you find some really nice subsidized leasing deal like GM was doing in 2014-15, leasing is usually the most expensive way to operate a vehicle according to consumer reports, money magazine, and a financial calculator. And even when they have those subsidized lease deals, they also have really nice rebate deals for people who buy. I'm a big proponent of buying what you can afford, and by afford I mean paying cash. Just because you can make the payments today doesn't mean you can afford it. Far too many Americans are up to their ears in payments and are a medical emergency or job loss away from bankruptcy. I won't yell at you for leasing if you have a million dollar net worth and the payments are a fraction of your net worth. But most people should be looking at their savings and buying something under that amount while keeping a decent emergency fund around.

I'm not trying to slam people, just trying to keep people from borrowing more than they can afford. Think of it as a public service. How much you spend on cars in your lifetime is inversely proportionate to your overall net worth upon retirement. Drive nice cars all your life, you might end up on the Alpo diet. Drive a beater for awhile to let compounding interest work for you, then you can drive and do whatever you want.

Back to the original question.... they sneak it into your new payment and add compounding interest (a.k.a. Money factor). A quick way to check whether you are getting a good deal or not, figure out how much you will be paying for the entire 36 or 39 month lease. If to is $10K or more, not a good deal, if it is $5-6K or so, it is a good deal. Anything in between is meh.

 

[jupitermoon]

No numbers were mention, not the payment, not what "several thousand" means and that may not even be a hard offer...Then we need to know if the OP resides in a carb state...

There are targeted incentives, including one that gives you $3000 off...All and all, a DTLA dealer is claiming ACC equiped Premier for $0 driveoff and $233/mo over 35 months assuming you qualify for the $3000 off incentive...Fremont in norcal often has an even better price...

Yes the targeted incentives are for non-GM customers and no German vehicle owners. I got my LT with leather and Bose for around that much. So $3k additional would have reduced my payment $90+ below that.

 

[jupitermoon]

Hey, I resemble that remark.

Seriously, unless you find some really nice subsidized leasing deal like GM was doing in 2014-15, leasing is usually the most expensive way to operate a vehicle according to consumer reports, money magazine, and a financial calculator. And even when they have those subsidized lease deals, they also have really nice rebate deals for people who buy. I'm a big proponent of buying what you can afford, and by afford I mean paying cash. Just because you can make the payments today doesn't mean you can afford it. Far too many Americans are up to their ears in payments and are a medical emergency or job loss away from bankruptcy. I won't yell at you for leasing if you have a million dollar net worth and the payments are a fraction of your net worth. But most people should be looking at their savings and buying something under that amount while keeping a decent emergency fund around.

I'm not trying to slam people, just trying to keep people from borrowing more than they can afford. Think of it as a public service. How much you spend on cars in your lifetime is inversely proportionate to your overall net worth upon retirement. Drive nice cars all your life, you might end up on the Alpo diet. Drive a beater for awhile to let compounding interest work for you, then you can drive and do whatever you want.

Back to the original question.... they sneak it into your new payment and add compounding interest (a.k.a. Money factor). A quick way to check whether you are getting a good deal or not, figure out how much you will be paying for the entire 36 or 39 month lease. If to is $10K or more, not a good deal, if it is $5-6K or so, it is a good deal. Anything in between is meh.

Leasing is no where near as bad as you make it out to be. First off, life's too short to worry about how much more a car will cost you 10 years from now. A few grand in the grand scheme of things won't make any difference at all other than giving someone daily enjoyment and pleasure in driving or owning something that...given today's salaries and inflation...no one could afford period.

I'm not going to wait around to enjoy my life until I make a million dollars that's for sure.

At around, $200 a month including tax, rebates, etc to lease an LT, I don't think that's ridiculous to get into a new car and enjoy one self a little. If you want to drive around in a beater and deal with repairs, issues, etc, then by all means that's your prerogative. I'm in my mid 40's now and I'm going to enjoy my life as much as I can in a responsible fashion. Who cares what magazine or financial advisor says. Susy Orman also says don't do jack until you are like her...then what the hell is the point of living?

People in this country are FORCED to pretty much have a car. They are FORCED to pretty much commute to work without any other recourse most of the time. We are FORCED to buy fuel and support oil companies. So you have to have a nice, reliable, decent car much of the time.

It makes no sense to put my neck out, put $15000 in cash for a used vehicle, deal the issues that come with it out of warranty, etc...when I can lease a reasonably decent car for around the same per month, have no hassles, etc and over the long run spend a few $$ more. My time is far more valuable than the money I'll save.

 

[llninja]

Leasing is no where near as bad as you make it out to be. First off, life's too short to worry about how much more a car will cost you 10 years from now. A few grand in the grand scheme of things won't make any difference at all other than giving someone daily enjoyment and pleasure in driving or owning something that...given today's salaries and inflation...no one could afford period.

I'm not going to wait around to enjoy my life until I make a million dollars that's for sure.

At around, $200 a month including tax, rebates, etc to lease an LT, I don't think that's ridiculous to get into a new car and enjoy one self a little. If you want to drive around in a beater and deal with repairs, issues, etc, then by all means that's your prerogative. I'm in my mid 40's now and I'm going to enjoy my life as much as I can in a responsible fashion. Who cares what magazine or financial advisor says. Susy Orman also says don't do jack until you are like her...then what the hell is the point of living?

People in this country are FORCED to pretty much have a car. They are FORCED to pretty much commute to work without any other recourse most of the time. We are FORCED to buy fuel and support oil companies. So you have to have a nice, reliable, decent car much of the time.

It makes no sense to put my neck out, put $15000 in cash for a used vehicle, deal the issues that come with it out of warranty, etc...when I can lease a reasonably decent car for around the same per month, have no hassles, etc and over the long run spend a few $$ more. My time is far more valuable than the money I'll save.

Tell that to the millions of people who already have their millions well before retirement, with regular jobs doing regular things. You are not forced to do anything. You are just being coerced by the banks and finance companies to spend beyond your means then listen to senators complain about the systemic flaws in the economy. Getting on the other side of compounding interest is the key. Staying on the paying side will hurt your entire life. Quite simply, leasing and borrowing causes you to spend money before you make it. Just pausing for a little bit and spending after you make it isn't that big of a change in lifestyle for a short period of time, but the difference from paying compounding interest to making compounding interest becomes 100s of thousands, even millions of dollars. Just use that financial calculator.

Edit: Many of the people giving this advice on this forum are millionaires, and they didn't get rich borrowing they way into riches. They unlocked their most powerful wealth building tool, their earnings.

 

[DonC]

Yeah it is a rough crowd and very unnecessarily so. It seems people here get a kick out of slamming others who have legitimate questions or are new to the scene. Truly ridiculous.

I think you are totally off-base. Couldn't disagree more. All the posts which you think constitute "slamming" are/were actually very good advice. They certainly weren't personally insulting in any way.

The truth is that unless you understand how leasing works -- and I have nothing against leasing -- it is highly likely you are going to be taken advantage of. And the only way to prevent that is to educate yourself. Leasing calculators are an OK start, but you need to understand why they work the way they do. Without a conceptual framework you're just blindly plugging numbers in.

 

[jupitermoon]

Tell that to the millions of people who already have their millions well before retirement, with regular jobs doing regular things. You are not forced to do anything. You are just being coerced by the banks and finance companies to spend beyond your means then listen to senators complain about the systemic flaws in the economy. Getting on the other side of compounding interest is the key. Staying on the paying side will hurt your entire life. Quite simply, leasing and borrowing causes you to spend money before you make it. Just pausing for a little bit and spending after you make it isn't that big of a change in lifestyle for a short period of time, but the difference from paying compounding interest to making compounding interest becomes 100s of thousands, even millions of dollars. Just use that financial calculator.

Edit: Many of the people giving this advice on this forum are millionaires, and they didn't get rich borrowing they way into riches. They unlocked their most powerful wealth building tool, their earnings.

Uhhh...leasing a car isn't going to prevent anyone from becoming or not becoming a millionaire...that's an absolutely ridiculous assumption. We're not talking about leasing a $1000/month car here are we?

We're not forced huh? OK well good luck going to work on a 30 mile one way commute every day 5 days a week back and forth without a car with no decent public transportation available. I guess I could take my bicycle instead.

You make it sound like buying a used car is free after payments are done. No they are not. You just reduce your monthly payment over a period of time IF you're lucky for the car not to have any issues.

Living in fear like you seem to do about spending money isn't the way I want to live. I do just fine spending money and enjoying my life and I don't think penny pinching to the extent you are advocating is necessary. If that's the case, why are you driving around in a 2013 car? Go get yourself a $2000 1994 Toyota Corolla and enjoy counting the money you saved in the hopes you can turn the $7000 you saved on a 3 year lease into millions.

 

[jupitermoon]

I think you are totally off-base. Couldn't disagree more. All the posts which you think constitute "slamming" are/were actually very good advice. They certainly weren't personally insulting in any way.

The truth is that unless you understand how leasing works -- and I have nothing against leasing -- it is highly likely you are going to be taken advantage of. And the only way to prevent that is to educate yourself. Leasing calculators are an OK start, but you need to understand why they work the way they do. Without a conceptual framework you're just blindly plugging numbers in.

That's fine...but instead of saying "you don't know then you'll get screwed"....extend a helping hand and help the guy. We don't need people telling someone who doesn't know that they don't know. They already know that.

 

[llninja]

Uhhh...leasing a car isn't going to prevent anyone from becoming or not becoming a millionaire...that's an absolutely ridiculous assumption. We're not talking about leasing a $1000/month car here are we?

We're not forced huh? OK well good luck going to work on a 30 mile one way commute every day 5 days a week back and forth without a car with no decent public transportation available. I guess I could take my bicycle instead.

You make it sound like buying a used car is free after payments are done. No they are not. You just reduce your monthly payment over a period of time IF you're lucky for the car not to have any issues.

Living in fear like you seem to do about spending money isn't the way I want to live. I do just fine spending money and enjoying my life and I don't think penny pinching to the extent you are advocating is necessary. If that's the case, why are you driving around in a 2013 car? Go get yourself a $2000 1994 Toyota Corolla and enjoy counting the money you saved in the hopes you can turn the $7000 you saved on a 3 year lease into millions.

I've purchased 4 cars between me and my wife over 22 years of marriage, a BMW 535i, a Cadillac CTS, a Chevy suburban, and this volt - all very nice car. I spent less than $23K on each of them (two of them purchased brand new with deals of the decade), all except the volt have over 100k miles on them, and only last month did I part with the BMW. Cars last much, much longer than a 3 year lease and they are much cheaper to repair than getting a new 3 year lease. Especially cars built better than average like my little fleet.

Compare that to two $7000 leases (one for me one for the wife) every 3 years for 21 years, $147K. Then comes the temptation to upgrade to a nicer vehicle every few years. Add increased insurance on brand new cars. And for me, mileage limits would have clobbered me. My $100k vehicular purchase plus maybe $20K in maintenance and repairs could easily hit $300K using your method.

And you're new here, search my history on this forum - I'm undecided on my next car but I'm currently contemplating an ELR, model S100D, CT6, i8, or maybe even an NSX. Then again, I might wait to see what else tickles my fancy. Cars depreciate like crazy, so the fewer you buy in a lifetime, the better off you will be. I will never drive a Toyota Corolla (though my dad did buy me a Toyota Supra while I was in college, awesome car even with 200k miles when I sold it). Houses and investments usually appreciate - that's where my money is.

I didn't grow up with a silver spoon. I just chose to put money into retirement and buy less than what I could afford. Now compounding interest allows me to drive whatever I want. You can continue to be normal trying to keep up with the joneses. We're all just trying to impart some wisdom here, ignore it if you want. Just remember you cannot borrow your way out of debt.

 

[DonC]

It makes no sense to put my neck out, put $15000 in cash for a used vehicle, deal the issues that come with it out of warranty, etc...when I can lease a reasonably decent car for around the same per month, have no hassles, etc and over the long run spend a few $$ more. My time is far more valuable than the money I'll save.

Used vehicles are a crapshoot. No doubt about that. Because prices are depressed, most vehicles which show up on the used market are less reliable than average. Some are far less. (Someone won a Nobel Prize for this BTW, so it's hardly a fresh insight). So while some people suggest buying used to save money, I doubt that it's this straightforward. Yes you'll save money on the front end, but maintenance on the back end can erase that advantage. Also, and this should be a big issue for everyone, the pace of safety innovation has been quite outstanding, which means buying a used car usually means buying one which is less safe.

I didn't grow up with a silver spoon. I just chose to put money into retirement and buy less than what I could afford. Now compounding interest allows me to drive whatever I want. You can continue to be normal trying to keep up with the joneses. We're all just trying to impart some wisdom here, ignore it if you want. Just remember you cannot borrow your way out of debt.

You have horses. Nothing wrong with that, but everyone picks and chooses their extravagances. Mine is likely travel (and maybe bad business deals -- LOL). I learned long ago that you can always spend someone else's money better than they can.

 

[DonC]

That's fine...but instead of saying "you don't know then you'll get screwed"....extend a helping hand and help the guy. We don't need people telling someone who doesn't know that they don't know. They already know that.

I honestly think they were trying to help the OP. I know I definitely was. It's a difficult subject to describe in a few sentences -- there are short books on the subject -- so suggesting that the OP educate themselves seemed most reasonable to me. And telling the OP to ignore the pull forward until they understood the lease deal being offered was really great advice.

 

[KenC]

Or will they just sneak it into the new lease (if I do it)?

That money has to come from somewhere.

 

[Bacardi]

That money has to come from somewhere.

There really are "pull ahead" programs where the manufacture eats the final payments, it's called "pull ahead" with the benefit being manufacture locks you into another of their leases...The problem is, shady dealerships can claim they're offering this but they roll the debt into the deal...A true pull ahead offer works at any dealership and if you qualify for one your lender should know about it...