How do I negotiate lease and know if dealer's offer is a good deal?

You, sir, will be ripped off no matter what you do.

You should NOT be doing this. You have at least 6 months of research to do in how the finance world works, with the leasing addendum at the end.

This sounds harsh, but you need it. You need to be slapped into reality. You are asking how to fly a 747 by posting a single note on the Usenet. You will crash and burn, and no amount of info from here, in this format, will help you.

Some things to consider:

• You are not buying a car, you are buying a car AND you are buying money. Those are two completely independent transactions. You need not buy the money from or via the same guy you buy the car from. In fact, if you do you WILL be ripped off.

• A lease is nothing more than a finance contract with a balloon payment. There's no magic. It isn't rocket surgery.

• The dealership doesn't lease you the car. The dealership SELLS the car and takes the money. They can sell the car to YOU, or they can sell the car to a finance company who will lease it back to you.

• If the salesman brings the buyer and the leasing company together, the salesman makes a commission. See my first point above. This commission is unrelated to the commission he makes for selling the car. Not only does he now have every incentive to make this deal as profitable as he can for himself and his dealership, he now has every incentive to make it as profitable as he can to the leasing company. He also has the

*ability* to do it because you're not paying attention, you're emotionally involved and not treating it like a business deal, and he owns all the cards.

• Anyone--ANYONE--who focuses on the monthly payment WILL be ripped off. The salesman owns all the cards, and he can manipulate that and squeeze you for ten bucks here and thirty bucks there until you have paid off his boat AND his trip to Hawaii.

• The salesman does this for a living, several times a day. You do it once every few years at best. Yes, he owns all the cards. And the more you ask him to do for you, the better his hand gets--until the best you can do is walk away without signing your name, because that's the ONLY way you won't be ripped off big time.

How do you avoid being ripped off?

• Ask for the out the door price of the car. Period. Not a monthly payment. He is selling the car. Get that to be as low as you can.

• Buy the money from someone who sells money for a living, not from someone who sells cars for a living. It's real simple. This is valid whether you're financing to own the car at the end, or whether you're financing to turn the car in at the end as the balloon payment.

• When you buy the money, buy it like you'd buy anything else--you want it as cheap as you can get it. Don't talk monthly payment. Talk interest rates. For leases, talk lease factors--but do the research on what that means.

• Don't lease a car if you're going to drive it 30K miles/year, especially not a Lexus. You're far, far better off buying it and simply selling it whenever you're finished with it.

I could go on and on with both lists, but I know I'm talking to a brick wall here.

To add; some time ago I leased over 3 years, 30k miles/year, an MB E Class from MB leasing. When the car went back at 90k miles, MB tried to stiff me for $6,000 (£ equivelent) of repairs. These comprised amongst other things of a full respray and 5 new tyres. (They were all road legal), windshield Fortunately the Company that collected the MB from me signed it off as all good, so I didnt pay. Thats why, this side of the pond, if you visit an MB dealer and look at the second hand cars, up to 4 years old, they all look like brand new.

Elmo, when you're right, you're right. If the OP has an employer that has a stake in this, he should be able to buy from fleet sales rather than retail. Second choice would be the car buying service at his credit union. Third choice would be to negotiate his own (cash) deal, which should come in at less than invoice.

Then, for purposes of getting the money, I always liked to find a lender with sufficient imagination to write a balloon note, which would keep the payments in the same ballpark as lease payments, but I'd be in the driver's seat and would have zero worry about difficulties when turning the car in. It takes a few moments with graph paper (or these days, a spreadsheet), but you can draw the depreciation curve and structure the note to keep your balance owed pretty well tracking the current value of the car, which is a Good Thing. That way, you're just paying for depreciation and interest, and are not using your vehicle as a savings account.

To the OP: Do not just put yourself in the hands of a dealer and let him handle an auto lease deal end to end unless you don't mind paying a substantial premium for the convenience, such as it may be.

Thank you all for your help. Especially you. Mr. Shagnasty. I appreciate all of your comments, except maybe your last one aboit talking to a brick wall. Not true. I have taken in your information and, to the extent I can, will use it to my advantage. I'm just a mere mortal trying to do the best I can. Posting my original message was part of that process.

Thanks again. I have found all of your responses helpful.

I know my employer's credit union started offering such a product several years ago.

I once had an employer offer to pay for me to lease a car. At the time, I owned a 1997 ES and was very happy with it. The only way I could get the "benefit" was if I leased a car.

So, I found a guy (in the phone book) that offered to buy my car and lease it back to me. That way, my employer paid the lease payments. It was a great deal. They bought my 1997 ES for $27,000 in 1999. I bought the car back 3 years later for about $15,000.

What are the parameters/constraints of your employer's offer to pay for your lease?