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Accuracy of Payment Estimator on Audi Site

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Old 03-13-2018, 07:21 AM
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Default Accuracy of Payment Estimator on Audi Site

I am a newbie here, looking for help. I am starting to look at an Audi A5 or S5 SB, (coming from a Lexus GS 350 F-Sport) and playing around with the build your own function and using the payment estimator. How accurate is that estimator? It gives me a lease payment in the $720 plus range for a A5 with a list price of ~56K. (A S5 listed at $65K lease is ~$850)... A $68K list Jaguart XF 30t estimates a lease of less than $650 and a Volvo S90 listed at over $70K even less than that. Are the lease terms for Audi really that bad?
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Old 03-13-2018, 07:40 AM
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use a lease calculator and edmunds.com forums money factor.

safe money factor is .0017 (you can do better even usually

Find out the residual from the dealer.

If you dont understand the financial mechanisms of a lease your are likely to get screwed by any dealer/brand leasing a car.
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Old 03-13-2018, 08:22 AM
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Google search edmunds 2018 audi "insert car model" lease deals. It'll take you to the forum that people post the most up to date and accurate money factors, etc.

Then use this calculator - leasehackr.com/calculator/
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Old 03-13-2018, 10:28 AM
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First and foremost, drive all three cars....then you'll see why each costs what they cost.

Many manufacturers have artificially inflated MSRP's and then do huge discounts (American brands). Others have over inflated residuals, because if they leased for "real" dollars, the cars would languish more than they already do. None of these means much unless you drive the car and like or hate it.

Would you rather pay $850 a month on a car you absolutely adore, or $700 a month on a car you loathe?

MSRP has little to do with a lease payment - residual value has everything to do with it.

S5 demand has been stronger month over month since it's introduction, and this trend seems to be continuing. As such, 0 incentives (because the cars sell, so no incentives are needed to move them...if demand was low/inventory high, incentives would be there)

Money factors are regionally based. Having someone plug in a random money factor, which has nothing to do with the model, isn't good advice.
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Old 03-13-2018, 02:46 PM
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Residuals is what kills it. Something like 60% after 3 years, so you're paying for that 40% over the course of the lease.
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Old 03-13-2018, 02:52 PM
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Originally Posted by stan23 View Post
Residuals is what kills it. Something like 60% after 3 years, so you're paying for that 40% over the course of the lease.
and giving it back without bearing the burden of depreciation. To many, that far outweighs paying for 100% of a car over 4-6 years. Just depends on needs/perspective
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Old 03-14-2018, 09:50 AM
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I still can't wrap my head around why I would want to lease instead of buy other then to just have a new / different car every 3 years or so and sure a monthly leases payment tends to be cheaper than a 5-6 year car loan. To say that when you lease you're not taking the depreciation burden seems odd to me since depreciation is really all your paying for for 3 years and the you do the same with another 3 year lease and so on and so on and at the end of them all you don't really have anything to show for it. If I buy the car and pay it off after 5 years I have a car and no more car payments until I decide I need to upgrade again and I could trade it in for some amount later toward another car. If you leased 2 cars for 3 years each you could have basically bought a single car.

I know you could lease a car for 3 years and then decide to buy it after but that ends up typically costing you more and if you take out a loan to buy it after the lease and you've extended the amount of time you're paying for the car. I know there is the possibility that they could have estimated the residual value wrong which could work in your favor. For example 60% is what you got the lease for but after 3 years the car ends up really being 50% so if you buy it after the lease you could save almost 10% or you could sell the car for more than the buy out amount thus pocketing the difference but those all seems like a gamble and likely at this point the dealers have a pretty good grasp of how to calculate the residual values that you likely won't save that much. I could be wrong though.

By time I get a new car at the end of this year (I hope) I've had 10 years of no car payments vs 15 years of leases payments and the money saved by not having a car payment for that long more than covered the annual maintenance cost to keep the car going for 15 years.

I purely look at this from a individual buying a mode of transportation and not a business where I could write off the car as a business expense or what not.

So with that said, are there any real benefits to lease other then just wanting a new car every 3 years? I'm just trying to understand if I'm missing something when it comes to leasing.
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Old 03-14-2018, 09:56 AM
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Originally Posted by heymoe View Post
I still can't wrap my head around why I would want to lease instead of buy other then to just have a new / different car every 3 years or so and sure a monthly leases payment tends to be cheaper than a 5-6 year car loan. To say that when you lease you're not taking the depreciation burden seems odd to me since depreciation is really all your paying for for 3 years and the you do the same with another 3 year lease and so on and so on and at the end of them all you don't really have anything to show for it. If I buy the car and pay it off after 5 years I have a car and no more car payments until I decide I need to upgrade again and I could trade it in for some amount later toward another car. If you leased 2 cars for 3 years each you could have basically bought a single car.

I know you could lease a car for 3 years and then decide to buy it after but that ends up typically costing you more and if you take out a loan to buy it after the lease and you've extended the amount of time you're paying for the car. I know there is the possibility that they could have estimated the residual value wrong which could work in your favor. For example 60% is what you got the lease for but after 3 years the car ends up really being 50% so if you buy it after the lease you could save almost 10% or you could sell the car for more than the buy out amount thus pocketing the difference but those all seems like a gamble and likely at this point the dealers have a pretty good grasp of how to calculate the residual values that you likely won't save that much. I could be wrong though.

By time I get a new car at the end of this year (I hope) I've had 10 years of no car payments vs 15 years of leases payments and the money saved by not having a car payment for that long more than covered the annual maintenance cost to keep the car going for 15 years.

I purely look at this from a individual buying a mode of transportation and not a business where I could write off the car as a business expense or what not.

So with that said, are there any real benefits to lease other then just wanting a new car every 3 years? I'm just trying to understand if I'm missing something when it comes to leasing.
I can speak for myself...and I work for the brand.
I have no interest (no pun) in paying interest on a depreciating item. I'd rather put the cash towards something that earns me money.

Owning a car, to me, has no upside. Depreciation is off the table on a lease....and to say I have nothing, to me, is incorrect. I had use of a new car, a nice car, and I paid only for what I used, and I gave it back before any maintenance (brakes, tires, etc). If I drive 15k a year, and I finance a car for 6 years, what is my $60k car worth in 2023 with 75k miles? What am I left with? Some money yes....but I'd be lucky if it's worth 1/6 of the new price. On top of that, I had maintenance costs, even for wear items. I can make more money with the money I saved by not parking it (again, no pun) in a depreciating item.

I've bought cars for cash, financed cars, and leased cars. The only car I will ever buy again is one that I have coveted forever, that I intend to keep forever. I see zero upside otherwise in ownership. For me, the lease works best

Everyone has their own priorities, and their own household budgets, and their own way they are wired, so options exist to satisfy all.

Last edited by SCarGuy; 03-14-2018 at 09:58 AM.
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Old 03-14-2018, 10:47 AM
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Everybody has to decide for themselves and their situation, but to say that depreciation is off the table on a lease is BS. The price you pay minus the residual is the depreciation that you pay over the lease term plus interest on top. By leasing a new car every two to three years you are paying much more in depreciation over time than if you hang on to a car longer and buy a new one only every 5-10 years. The depreciation is highest during the first few years and eventually flattens. So by leasing a new car every three years you pay the steepest rate of depreciation every three years.

However, if you change cars every 2-3 years anyway, then leasing is an attractive option. One benefit in many states is that you only pay taxes on the monthly payment instead of upfront for the entire car when paying cash or financing. In general buying/owning a car beyond its initial high depreciation ends up being cheaper, though. Maintenance is no different for the first 4 years/50,000 miles either way. Even on a leased car you have to pay for maintenance and wear items and repairs are covered under warranty for the first 4 years/50,000 miles either way. Certainly as the car ages you'll have more wear and maintenance, but in all likelihood that will still be cheaper than paying full depreciation every 3 years. All depends obviously on the car and how reliable it is in the first place.

Just to give you an idea, I owned my previous B7 S4 for 8 years w/o major repairs. Just wear items and maintenance. I paid cash for my current RS5 and have so far had it for 5 years. Yes, I parked all that money in a depreciating asset, but I also paid zero interest. I bought the RS5 flat out for a couple of reasons. A) I was doing European Delivery and didn't wanna have a lease payment while not being able to use the car for 10 weeks while it was shipped to the US and B) I knew this was one of the last NA V8 in this category, so it felt like something special.

I may lease again in the future if I don't see myself keeping a car beyond 3 years. With a lease you basically know what the car is worth 3 years from now worst case. If you are lucky you have some equity in it at the end and can trade it in, but if you have an accident during the lease or anything else that causes the value of the car to drop lower than the residual, then you can just give the car back and a lease may also include gap insurance, so if you do total the car you just walk away hopefully unhurt.

One of the biggest reason I stopped leasing was actually that it forced me to find a new car every three years. I'm very picky on cars and there are not a lot of option that fit my lifestyle and desires. I'm mostly a performance GT buyer. I have no interest in sedans or cars that I can't really drive every day (supercars). I actually leased my B7 S4, but ended up buying it at the end, because there was nothing that really interested me at the time. It was my only sedan I ever owned/leased, too.

I'm also very intrigued by the car share models and potentially giving up on owning/leasing a car all together. I don't have a commute. I stopped going to an office several years ago. I own my own company and work from home along with my business partners. We don't even have a physical office anymore. I've started to use Audi on Demand to rent all kinds of Audis for different occasions. I sometimes rent an R8 to have some fun over the weekend or I rent an Allroad for a road trip if I need more room than my RS5 provides. Probably won't give up on having at least one car in my garage at all times, but my annual mileage on my car has dropped in half from 14-15k miles to around 6-7k at the current rate. Living in the city with public transportation, emerging ride sharing services (Uber, Lyft, etc.) and emerging car sharing services such as Audi on Demand, does put a diminishing return on owning/leasing one's own car. We live in changing times. Car ownership may go the way of the dodo. Car manufacturers are actively looking into mobility services rather than selling cars to individuals. The new Polestar 1 from Volvo is gonna be the first car that can't be bought anymore, and instead you are renting it from Volvo/Polestar essentially for a certain duration with maintenance and everything included.

Last edited by superswiss; 03-14-2018 at 11:20 AM.
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Old 03-14-2018, 11:10 AM
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Originally Posted by superswiss View Post
Everybody has to decide for themselves and their situation, but to say that depreciation is off the table on a lease is BS. The price you pay minus the residual is the depreciation that you pay over the lease term plus interest on top. By leasing a new car every two to three years you are paying much more in depreciation over time than if you hang on to a car longer and buy a new one only every 5-10 years. The depreciation is highest during the first few years and eventually flattens. So by leasing a new car every three years you pay the steepest rate of depreciation every three years.

However, if you change cars every 2-3 years anyway, then leasing is an attractive option. One benefit in many states is that you only pay taxes on the monthly payment instead of upfront for the entire car when paying cash or financing. In general buying/owning a car beyond its initial high depreciation ends up being cheaper, though. Maintenance is no different for the first 4 years/50,000 miles either way. Even on a leased car you have to pay for maintenance and wear items and repairs are covered under warranty for the first 4 years/50,000 miles either way. Certainly as the car ages you'll have more wear and maintenance, but in all likelihood that will still be cheaper than paying full depreciation every 3 years. All depends obviously on the car and how reliable it is in the first place.

Just to give you an idea, I owned my previous B7 S4 for 8 years w/o major repairs. Just wear items and maintenance. I paid cash for my current RS5 and have so far had it for 5 years. Yes, I parked all that money in a depreciating asset, but I also paid zero interest. I bought the RS5 flat out for a couple of reasons. A) I was doing European Delivery and didn't wanna have a lease payment while not being able to use the car for 10 weeks while it was shipped to the US and B) I knew this was one of the last NA V8 in this category, so it felt like something special.

I may lease again in the future if I don't see myself keeping a car beyond 3 years. With a lease you basically know what the car is worth 3 years from now worst case. If you are lucky you have some equity in it at the end and can trade it in, but if you have an accident during the lease or anything else that causes the value of the car to drop lower than the residual, then you can just give the car back and a lease may also include gap insurance, so if you do total the car you just walk away hopefully unhurt.

One of the biggest reason I stopped leasing was actually that it forced me to find a new car every three years. I'm very picky on cars and there are not a lot of option that fit my lifestyle and desires. I'm mostly a performance GT buyer. I have no interest in sedans or cars that I can't really drive every day. I actually leased my B7 S4, but ended up buying it at the end, because there was nothing that really interested me at the time. It was my only sedan I ever owned/leased, too.
We can agree to disagree, but it is not BS at all.

Depreciation in a lease is the manufacturers risk, not mine. If they are wrong, and the market value of their car is 10% less than what they projected residual to be, it's not my problem, it's theirs. If I buy the car, it's my problem...with interest on top. Meaning a hefty downpayment up front to stay ahead of the curve and retain some equity position, or a big chunk of cash up front to buy the car outright. For some, this works, for others it does not. I can make more with the money vs. what the rate of depreciation is. A lease keeps me flexible. Atypical lease at 3 years and 36k (less for me, but still), and I am not dealing with any wear and tear. I give the car back before that's an issue. If I buy it, it's mine to deal with. Again, different scenarios favor different people.

I have had many many cars in my life...more than most of my clients. I have bought them for cash, financed and lease. I have made the determination, for a variety of reasons, leases make more financial sense to me. Has little to do with changing the car out more frequently. It's a byproduct of the transaction type for me, but does not sway me one way or the other.
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