About to lease new Yukon XL Denali - advice needed

[Ccampb1346]

No but I know one in Texas if you want to fly one way and drive it home, below invoice price..

Who can I call for below invoice pricing in Texas? Thanks

 

[Got-Boost?]

I'll send you a PM!

 

[rad-man]

I don't have to put money down on a lease. I choose to pay the taxes up front (just as I would on a purchase) so I don't pay interest on taxes. I like a new car every couple of years....When you trade in a car, you take a pretty significant hit as the car has depreciated quite a bit. if you want to get out of it halfway through (even if for some extenuating circumstance like a job loss) selling a car that you purchased will almost always result in a loss of some level.

If I am going to rent a car for 36 months, I'd rather do it cheaper per month (even at 1.9% I'm over $250 PER MONTH lower with a lease), have the flexibility to walk away from the car mid-lease (I just got out of a 3 year BMW lease a year early for the listing cost of $249 of the car on leasetrader.com), etc. I also understand the factors that go into leasing such as the money factor (interest rate) and residual. I negotiate for all of my leases to be sold at the buy rate (dealer cost) which helps even more. Lastly, I also get a significant tax benefit for leasing through my business.

if you are going to keep a car for 5+ years, don't lease it. It's not for everyone, but it is for me.

Would you mind showing me your numbers? or telling me what your lease payment would be on a MSRP of $77,365?

Also, i just re-read your original post, and have you seen the White Frost Metallic? It's amazing.

 

[yahtzee]

Would you mind showing me your numbers? or telling me what your lease payment would be on a MSRP of $77,365?

Also, i just re-read your original post, and have you seen the White Frost Metallic? It's amazing.

I haven't seen it yet but I gather that it's a white metallic without the yellow. Since I will be turning the car in after 3 years, spending $1000 over that term for a color doesn't make a whole lot of sense BUT since I am hell bent on the Dark Atmosphere interior color I may not have a choice.

My payment for that (I used 72k as CAP cost as that is GM Supplier pricing) would be $973 for 36 most at 15k miles. I went conservative for the miles for this example but doubtful that I will go 15k miles when structuring the lease.

 

[rad-man]

You got it...
My MSRP was 77365, supplier pricing put me at $72,081.00
1.78% APR has be on payments of $1294 for 60 months.

Aside from your business tax benefits, is this the right train of thought:

So lease would be $973 * 36 = $35,028 +$4,500(plus your up-front taxes?) = $39,500

my purchase (After 36 months) is 1294*36= $46,584

So after 3 years, i still owe $31,056.

The question becomes: is 3-year-old car with 45k miles worth $38k? (31k + $7k difference from lease) ... this would be the break even point to leasing. If i sell it for more than 38, it's better than leasing?

 

[yahtzee]

Valid question but it really comes down to you and what you think you will do...I am very fickle with cars so I know I won't be buying at the end of a lease. I think you forgot to add in the same $4500 in taxes to your purchase price.

You can also sell before the lease is finished...it is the residual + any remaining payments. That usually doesn't work out until there are 3-4 months left on the lease or less.

 

[Got-Boost?]

What money factor are you getting/using for your estimate? Neither of your numbers add up...

 

[yahtzee]

What money factor are you getting/using for your estimate? Neither of your numbers add up...

Hmm....for 2015 models it is .0008 and for 2016 models it is .00205. Checking again.

 

[glewis18]

Have you factored in accelerated depreciation on a vehicle purchase over 6000lbs? Completely different scenario than you are used to if you have been purchasing cars through your business

 

[Got-Boost?]

Hmm....for 2015 models it is .0008 and for 2016 models it is .00205. Checking again.

This is what I'm getting....

$72,000 sale price
$4,500 down payment
tax 6.75% (my area)
Interest at 1.78% 60mo finance to OWN= $1,261mo

Same as above lease...2015
Residual $38,500
Money Factor .0008 (?)
36mo = $946ish
Tax up front ($4,860)
$9,360 due at signing
36mo = $797ish = $28,692 + $4,860 = $33,552 to drive for 3-years

Same...2016 (finance tax)
Money Factor .00205
36mo = $1,087ish = $39,132 + $4,860 = $43,992

Tax up front ($4,860)
$9,360 out of pocket at signing
36mo = $933mo = $33,588 = $9,360 = $42,948

Just making sure I understood the math on both sides and business end...

Congress decided years ago that the taxpayers should not subsidize extravagant vehicles used by business. To prevent that, the law squeezes otherwise allowable depreciation deductions for “luxury cars.” But don’t think Rolls Royce or Ferrari. Congress has a much less extravagant view of luxury. For 2014, the maximum first-year depreciation write-off for a new (not used car) that costs over $15,300 is $3,160. For a used car, the maximum first-year write-off for 2014 is a much lower $3,160. (These figures assume 100% business use.)

The limit is higher for SUVs with loaded vehicle weights over 6,000 pounds. For such vehicles put into use in 2014, 50% of the cost can expensed using Section-179 expensing, plus another 50% of the cost that wasn't expenses under section-179 for bonus depreciation, plus another 20% of the cost leftover for regular first-year depreciation. So for a new $50,000 heavy SUV put to use in 2014 and used 100% for business, $40,000 can usually be written off in 2014.