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View Poll Results: Do you buy or lease your vehicle(s)?
Buy 143 87.73%
Lease 7 4.29%
Both 13 7.98%
Other (please explain) 0 0%
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Old 03-21-2018, 12:29 PM   #61
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I drive the wheels off of every car I own and keep them until they die a horrible death. Currently I am still in my 2002 F150 if that's any indication, and I have no plans to sell that truck any time soon. Still runs great and no major repairs!

Figuring a car payment of 350 per year and it being paid off in 5 years. The remaining payment if I kept getting a comparable new car would have cost me an additional $46K.
There is no way a lease was going to do as well when you drive a vehicle that many years. I just figure each year I drive it, I am saving yet more dollars.



My wife had a 2004 Honda CRV which we gave/sold for pennies on the dollar, to our DD and DD still drives it. We replaced it with a 2015 CRV which we plan to drive into our retirement years.
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Old 03-21-2018, 01:28 PM   #62
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I pursued a lease on a Toyota Tacoma pickup a couple years ago when I was in the market for a new pickup. They advertised something like $159/month... but that didn't include taxes and certain fees.... by the time they give you a real life number... it was 150% or more of the advertised price... talk about bait and switch!
Yes, leasing can be tough on new customers to the process.

For me, who has originated nine leases over the years, it's particularly frustrating to go through the same old shenanigans every time I lease. The last couple of times I simply told the salesman I wanted to talk to the new car general manager, or no dice. One time I called the dealership talked to the GM, and made an offer on a vehicle in his inventory over the phone, "If you can make this lease happen on stock number xxyyzzz123 for $270 a month, true zero down, I'll drive over there today and do the deal." It worked. That monthly amount was $25 less than the other three dealers I had already jumped through hoops with and been insulted with the pricing.
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Old 03-21-2018, 01:47 PM   #63
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There seem to be some common elements here on the forum.

This type of strategy:

and having plenty of money in retirement.
Yep, and those that lease have little to no money in retirement, uh, wait, nope, that's not right....
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Old 03-21-2018, 01:55 PM   #64
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Yes, leasing can be tough on new customers to the process.

For me, who has originated nine leases over the years, it's particularly frustrating to go through the same old shenanigans every time I lease. The last couple of times I simply told the salesman I wanted to talk to the new car general manager, or no dice. One time I called the dealership talked to the GM, and made an offer on a vehicle in his inventory over the phone, "If you can make this lease happen on stock number xxyyzzz123 for $270 a month, true zero down, I'll drive over there today and do the deal." It worked. That monthly amount was $25 less than the other three dealers I had already jumped through hoops with and been insulted with the pricing.
I hear ya Q! People who don't become educated on the process will def get stuck on the wrong side of the deal, I learned that lesson my first attempt at leasing

Similar to how most people here didn't know all the answers on how to invest for retirement, how to plan for SS, and how to get the most from ACA, there's time required to learn from others on the finer points of leasing. Things like understanding residual value, negotiation on price and payment, MF, finding incentives and even the power of multiple security deposits to get payments even lower. For me, I negotiate everything via email before even stepping foot at a dealership. I'll even have my credit application submitted and lease approved so that I don't waste any more time at a dealership than I need to.
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Old 03-21-2018, 09:20 PM   #65
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I hear ya Q! People who don't become educated on the process will def get stuck on the wrong side of the deal, I learned that lesson my first attempt at leasing

Similar to how most people here didn't know all the answers on how to invest for retirement, how to plan for SS, and how to get the most from ACA, there's time required to learn from others on the finer points of leasing. Things like understanding residual value, negotiation on price and payment, MF, finding incentives and even the power of multiple security deposits to get payments even lower. For me, I negotiate everything via email before even stepping foot at a dealership. I'll even have my credit application submitted and lease approved so that I don't waste any more time at a dealership than I need to.
There is a lot to learn, that's for sure. I sometimes think I should put together a little tip sheet.

I do a lot of work up front as well. I like to look online at a dealer's inventory, download the .pdf file of the window sticker and get acquainted with all the options and optional packages, even down to knowing the manufacturers code numbers for the packages. It lets them know you mean business. Another thing I like to do is rattle off the dealer stock number and/or the VIN# of the vehicle I'm interested in negotiating over.

I already tell them up front, "I've leased for 23 years, and I'm looking to lease again. I WILL BE LEASING another vehicle before my lease expires on July 1st. The question is--will I be leasing from you?"

Another negotiating tactic I like to employ is to show indifference at driving the vehicle. Salespeople want to get you into the dealership and LOVE to get you in the drivers seat and surrounded by new vehicle smell. I just keep saying I don't need to drive it or I say I already drove one at another dealer.

Since my credit rating is near perfect I think I'm going to adopt your strategy of already filling out the credit application before I even start talking to the dealer. That way, they know I'm not wasting their time and my hard bargaining should be respected.

Please tell me about the multiple security deposit strategy.
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Old 03-22-2018, 09:39 AM   #66
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I already tell them up front, "I've leased for 23 years, and I'm looking to lease again. I WILL BE LEASING another vehicle before my lease expires on July 1st. The question is--will I be leasing from you?"
Heh - I just had that same conversation as my daughter was looking to get new vehicle as her lease was coming up at end of last month. Being 3,000+ miles away it was still pretty easy negotiation until she got there. She then saw a different vehicle she wanted (sports package) and then the deal started to turn around, I guess he thought she was easy mark as he started to try and toss junk into her deal, including adding in Lojack for $695, nitrogen in the tires for $99 and then then trying to give her a "courtesy" vehicle with 1,500 miles on it.

Well, she patched me in on a call with the guy, told him we aren't paying for the junk fees and I could see from inventory he had some vehicle (package and color) on his lot that just came in. He started the tap dance again and I told him just what you said. There were 2 other dealers within 15 miles, if he couldn't give me the deal then I'd be doing business with one of the other dealers (already had preliminary deal with one of them as fall back). Within 5 minutes he confirmed in email the specifics of the deal. And her vehicle still had Lojack on it and the nitrogen - they had already "installed" both. It was funny, when daughter looked at vehicle it had 7 miles on it, when she picked it up it had 9, so she jokingly why the 2 additional miles on it. The salesperson explained that he had to drive it to get her tank filled up, and that "please don't have your dad call"..... she cracked up on that and salesperson figured out she was actually joking about it.

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Since my credit rating is near perfect I think I'm going to adopt your strategy of already filling out the credit application before I even start talking to the dealer. That way, they know I'm not wasting their time and my hard bargaining should be respected.
I would not fill out application before you get serious with the deal, you don't want them to do a credit pull on you unless you are really going through with the deal. I do make it clear that my FICO score (and that of my daughter) is excellent. Once numbers are set I give them my credit app and ask them to give me a call once all the paperwork is done.

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Please tell me about the multiple security deposit strategy.
MSD's are additional security deposits that some manufacturer's accept and in return you get a lower MF. Each manufacture's MF reduction is slightly different, Infiniti for example gives 0.00010 reduction for each MSD - so with up to 9 that's 0.00090 MF reduction (which is 2.16 APR reduction). Unless it's changed, Toyota is 0.00008 MF reduction with each MSD - so with 9 that's 0.00072 (which is 1.728 APR reduction).

MSD's are fully refundable. The risk you may have is if the car manufacturer should go out of business you may not get your security deposit back. I'm not concerned with that, and also figure my savings would offset that risk. Based on the savings you get 30-40% return on your security deposit (or 10-13% annually). On one lease, I had paid 9 MSD's ($3,600), saved me $40/month ($1,440 over the lease), which is 40% or 13.3% annually, sure beats keeping my money in a CD! When I turned car in the security deposit was returned to me.

These are the companies that offer MSD as option (to the best of my knowledge):BMW used to offer this but discontinued offering last year.

This thread has a decent discussion that explain MSD's and benefits.

Hope that helps understand MSD's.
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Old 03-22-2018, 10:38 AM   #67
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Buy new with cash, and keep as long as possible.
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Old 03-22-2018, 10:50 AM   #68
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Heh - I just had that same conversation as my daughter was looking to get new vehicle as her lease was coming up at end of last month.

[..]

Well, she patched me in on a call with the guy, told him we aren't paying for the junk fees and I could see from inventory he had some vehicle (package and color) on his lot that just came in. He started the tap dance again and I told him just what you said. There were 2 other dealers within 15 miles, if he couldn't give me the deal then I'd be doing business with one of the other dealers (already had preliminary deal with one of them as fall back).
Yes, I do the fallback ploy as well. When the salesperson asks the qualifying question (and they always do, as they are trained to do it) "So if I can get you a price you're happy with can we do a deal today?" I say, "I just started shopping. I can't accept the first offer I hear. I need to do more research. The first place I'm going when I leave here is...[then I name their competitor".] Well, I've already looked at the other dealer's inventory and called them and gotten their pricing. Now pitting the two dealers against each other can start in earnest.

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I would not fill out application before you get serious with the deal, you don't want them to do a credit pull on you unless you are really going through with the deal.
Good point.

Quote:
I do make it clear that my FICO score (and that of my daughter) is excellent.
Yes, I do this as well. I love dropping that number on them.


Quote:
MSD's are additional security deposits that some manufacturer's accept and in return you get a lower MF. Each manufacture's MF reduction is slightly different

[..]

This thread has a decent discussion that explain MSD's and benefits.

Hope that helps understand MSD's.
I'll look into it. Thanks.
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Old 03-22-2018, 10:55 AM   #69
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Just remembered something--I've been to dealers where they won't put a price in writing on their company stationery. Instead they scribble some numbers and a stock number on a blank piece of paper and hand it to you. I just look at them with an incredulous look on my face and say, "Are you serious? What, the dealership doesn't want their name on this offer?"
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Old 03-22-2018, 11:33 AM   #70
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We lease one and own one. Lease the german rocket and own the Korean sled. When I retire will move to owning both and replacing one of the two every 3 years.
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Old 03-22-2018, 04:00 PM   #71
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... When the salesperson asks the qualifying question (and they always do, as they are trained to do it) "So if I can get you a price you're happy with can we do a deal today?" ...
That's called a "trial close." SOP for a good sales guy. The idea is to see how close the customer is to committing. Other (less aggressive) trial closes are things like "What color do you like the best?" The idea is to move the negotiations along where possible.

There are negotiating techniques that are more effective than immediately making it clear that you are an adversary. For example, I'll answer that "if I can get you a price ... " question by saying "Sure," then offering something like half what is reasonable. This makes a joke out of it instead of making me an adversary. When I leave the store I want the sales guy to be wanting to see me again because he had a pleasant experience. In the end IMO that makes it more likely that, when I do call or come back, he will help me to get the best deal I can get at that store instead of trying to close me at the highest price possible because I am a jerk. YMMV, of course.
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Old 03-22-2018, 04:38 PM   #72
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There are negotiating techniques that are more effective than immediately making it clear that you are an adversary.
When I answer the question, "If I can get you a price that will make you happy will you do the deal', with "I need to do more research", how is that adversarial?


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For example, I'll answer that "if I can get you a price ... " question by saying "Sure," then offering something like half what is reasonable. This makes a joke out of it instead of making me an adversary.
Or it makes you look like a clown.
Never be the first one to state a number.
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Old 03-22-2018, 04:49 PM   #73
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When I answer the question, "If I can get you a price that will make you happy will you do the deal', with "I need to do more research", how is that adversarial?

Or it makes you look like a clown.
Never be the first one to state a number.
No interest in debating with you BTDT. I have negotiated hundreds of deals, most bigger than a car deal and was simply trying to point out (to others) that there are other negotiating styles, but as we know YMMV.
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Old 03-22-2018, 07:48 PM   #74
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No interest in debating with you BTDT. I have negotiated hundreds of deals, most bigger than a car deal and was simply trying to point out (to others) that there are other negotiating styles, but as we know YMMV.
Agree with you, everyone has their own style - and then also need to adjust your style based on the style of the salesperson you are dealing with. No one size fits all for sure. I'm willing to give a number to the salesperson but it's slightly lower than I was willing to accept. If they agree, then cool, if not then I still have done my homework and know where I want to be.
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Old 03-22-2018, 08:52 PM   #75
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When I answer the question, "If I can get you a price that will make you happy will you do the deal', with "I need to do more research", how is that a negotiating style? I didn't even mention a number! There's nothing being negotiating. Sheesh.
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Old 03-22-2018, 09:40 PM   #76
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There seem to be some common elements here on the forum.

This type of strategy:

and having plenty of money in retirement.

That strategy actually has cost me a lot more money with repair and maintenance.. not to mention the time off from work .. and how much money that has costs me..
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Old 03-23-2018, 08:43 AM   #77
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Agree with you, everyone has their own style - and then also need to adjust your style based on the style of the salesperson you are dealing with. No one size fits all for sure. I'm willing to give a number to the salesperson but it's slightly lower than I was willing to accept. If they agree, then cool, if not then I still have done my homework and know where I want to be.
Yes. There are some fundamental things, too. Like a good negotiator will check his/her ego at the door and will usually have the goal of being underestimated. I can steal a lot or salami in slices too small to fight over, particularly if the guy on the other side of the table is snoozing. So in most cases I am quite happy to "look like a clown."

We have an elderly friend, kind of an honorary aunt, who wanted to buy a new Toyota a few years ago. I spent about 1/2 hour teaching her a simple ego-less technique called "absent authority" negotiating. By the time she was done she had saved several thousand $$ vs the dealer's first offer and in the end she didn't even pay the standard documentation fee. They never knew what hit them.

I had a business friend, worth well north of $10M, whose whose whole persona was built around this. One evening I had to attend a city council meeting to deal with some kind of issue with our business. Jim was there seeking a variance on one of his many properties. He stood there in black low-cut work shoes with thick rubber soles, white socks, one of those Sears grey/green work shirts with matching pants and with a wild head of white hair that looked like he cut it himself. The council immediately gave the "nice old man" what he asked for. Had he come in wearing at $1000 suit, flanked by a couple lawyers and pounding his chest they would have thrown him out on his a$$. Fun to watch and learn from.
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