Finance Question
 

OK... Audi Lease V Audi Premier Pruchase (baloon)

FOrgeting how sales taxes are handled... lets make them total equal sales prices (cap cost)

48 month lease or payment

MSRP 46500
Sell 45500

Residual 45% of msrp for both plans

Is there any rule or rational as to which should be cheaper? The Audi Priemier is working at 5% APR.

Re: Finance Question
 

I have a balloon and found that it actually offers greater flexibilty then a lease with more miles. I have 20k miles built into mine for 48 months. Also, the balloon can be converted to a regular installment loan and or paid off at any time. I also have one for my wifes truck and have paid off an earlier one from Chase with no hassels what so ever. Leases just scare, although the same conceptually the Premier appears at least to me to be a better way to go.

Agreed....
 

From the flexability point it is better. This is what I wish to do with the Cabrio (yet to order).

But I was curois about it.. It would seem to me that the Baloon method is simply:

Sale price less residual @ 5.0 APR for 48 month's PLUS the interest on the residual for the 48 payements. Am I right?

Whether you finance or lease, there are essentially three factors to consider
 

Price, residual and interest. (I'm ignoring any time value associated with prepaying sales tax in a purchase versus over time in a lease, since in this low interest rate environment, this amount would be de minimus).

If, as in your example, you assume price and residual are the same, then the only remaining parameter to compare is your interest rate (which in lease terms is discussed as a money factor, but is easily converted to an interest rate). So, in your example, if the offerred lease money factor is less than a 5% APR, you're better off leasing. FYI, a lease money factor of .00208 converts to a 5% interest rate.

Also, in a purchase scenario the residual is pretty much up in the air whereas in a lease, it is truly fixed (provided you don't exceed miles, damage the car, etc.).

See http://www.leaseguide.com/calc.htm for a helpful guide (you would think after 3 years on the board I would know how to hot link to a URL, but I don't).

Hope this helps.<ul><li><a href="http://www.leaseguide.com/calc.htm">http://www.leaseguide.com/calc.htm</a</li></ul>

Re: Agreed....replied
 

yes that is my understanding.

Did you see my post to the Cabrio a few days back. There is a seal grey one with red interior at Mohegan Lake Motors. Very sweet.

We drove one last night
 

We are playing dealer A off Dealer B... the car will be ordered for July...

Re: on e?

Re: DA. you meant One. disregard

I don't know the lease factor.. but the Baloon is 5%
 

In your way of looking at it.. what would the baloon payment be:

Cap cost 44669.00
Baloon 21375.00

5% interest 48 months.

paste the link in the box enitled "optional link url".......been riding this year?
 

<ul><li><a href="http://www.leaseguide.com/calc.htm">http://www.leaseguide.com/calc.htm</a</li></ul>