Go Back   Jeep Garage - Jeep Forum > Jeep Platform Discussion > Grand Cherokee - WK2 -

Join Jeep Garage Today
Reply
 
Thread Tools Display Modes
 
  #25  
Old 03-08-2013, 08:52 AM
xmonger's Avatar
Member
My Jeep: 2003 4.7 HO WJ
 
Join Date: Feb 2010
Location: Holmdel, NJ
Posts: 193
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 1834
xmonger will become famous soon enough
Re: 2014 Overland ordered, look at this money factor

Quote:
Originally Posted by ominous24 View Post
I emailed the dealer overnight and he got back to me at 6am, lol. He said with a large down payment and the case of the vehicle being stolen/totaled early I would get the money back. I will have rather hear that from Ally but he said it is up to me which I do. Of course throwing it in a savings account accrues interest.

Total dealer BS.

Upon total loss in a lease situation, the insurance company pays the financing entity (vehicle owner) not you (renter) and the lease contract is terminated. All prepaid lease $$$ is gone.


Do's and Don'ts When it Comes to Auto Leasing

Why It's Not Smart to Put a Down Payment on a Lease


Best of luck with it.
__________________

__________________
2003 WJ Overland 4.7 HO
Reply With Quote
  #26  
Old 03-08-2013, 08:55 AM
Member
My Jeep: 2014 5.7L WK2
 
Join Date: Aug 2011
Posts: 56
Thanks: 0
Thanked 3 Times in 3 Posts
Rep Power: 307247
joeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond reputejoeyd5oh has a reputation beyond repute
Re: 2014 Overland ordered, look at this money factor

Take it from me quite a few years ago I leased a Cadillac Escalade. I wound up putting about 14K down for the stupid reason that the lower payment just looked better on paper when I had to write the check every month. A little over a year later some thieves felt they needed my car for the rims and interior and stole it. Car winds up being totaled. All I got back was about 2k and I was lucky to get that back because that was the equity left in the vehicle. Trust me its the Worst feeling in the world losing 12 grand after only having the car a year. Now I put zero down Lesson Learned.
__________________

__________________
Reply With Quote
  #27  
Old 03-08-2013, 11:33 AM
Member
 
Join Date: Jan 2013
Location: Seattle, WA
Posts: 220
Thanks: 0
Thanked 8 Times in 8 Posts
Rep Power: 769
Copefree is on a distinguished road
Re: 2014 Overland ordered, look at this money factor

Quote:
Originally Posted by torifile View Post
Don't put money down. And take a look at the residual percentage. Looks really low to me.
By just looking at the numbers he posted you can see that the residual is 52%. Could be worse, but could be much better too! I'd like to see it more in the 55% area.

MSRP x residual (.52) = Buy Option ($26,091)
__________________
Reply With Quote
  #28  
Old 03-08-2013, 12:00 PM
JTS97Z28's Avatar
Premium Member
My Jeep: 2012 3.6L WK2
 
Join Date: Jan 2011
Location: Plainfield, IL
Posts: 1,449
Thanks: 0
Thanked 29 Times in 19 Posts
Rep Power: 25117
JTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond reputeJTS97Z28 has a reputation beyond repute
Send a message via AIM to JTS97Z28
Re: 2014 Overland ordered, look at this money factor

I wish I understood the whole lease thing better. I always see people say they like to get new cars every couple years and what not, so they go with a lease. I go through cars a lot quicker than that and I still have never leased. I just buy my next vehicle then sell my current one myself. I have actually made money on cars before as weird as that sounds.
So if your going to be paying $600+ a month on a new Grand Cherokee with a lease, why would someone not just buy it? To get a $600 or less monthly car payment on a purchase would actually not require that much money down. So wouldnt it just be beneficial to buy it and be putting money into ownership, especially with these current low rates 1.49% or maybe even less?

As a real world example, I bought my 2012 Overland in March of 2012 for $39,600+ttl. I drove the vehicle for 9 months and put about 10,000 miles on it. I then sold it a couple months ago for that exact same price. So all I was out was a couple thousand in taxes that I paid. Can someone please explain to me how leasing a vehicle can be beneficial? I guess what im saying is that, unless the monthly payments on a lease were significantly lower then maybe I could understand, but they really are not, so where is the benefit?
__________________
Reply With Quote
  #29  
Old 03-08-2013, 12:51 PM
SW03ES's Avatar
Premium Member
My Jeep: 2014 3.6L WK2
 
Join Date: Jun 2011
Location: Gaithersburg, MD
Posts: 1,739
Thanks: 14
Thanked 39 Times in 34 Posts
Rep Power: 1303316
SW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond repute
Re: 2014 Overland ordered, look at this money factor

Quote:
Originally Posted by ominous24 View Post
I emailed the dealer overnight and he got back to me at 6am, lol. He said with a large down payment and the case of the vehicle being stolen/totaled early I would get the money back.
He's wrong. Car salespeople know nothing about leasing, especially Jeep/Chrysler salespeople because its really rare a buyer leases one. You get into luxury car dealers its way more common. Even then, I have never met a finance manager at a luxury car dealer who knows more about leasing than me, let alone a salesman.

Best way to calculate payments:

http://www.leaseguide.com/calc.htm

You should be able to use that to play around with the figures, but its simple, if you are putting $11,500 down (trade plus cash), divide that by 36, its $319.44. That is what the downpayment reduces the payment. Add that to the payment they are quoting you, and thats what it will be.

With a money factor that low, thats even more reason to put nothing down.

Quote:
Originally Posted by JTS97Z28
I wish I understood the whole lease thing better. I always see people say they like to get new cars every couple years and what not, so they go with a lease. I go through cars a lot quicker than that and I still have never leased. I just buy my next vehicle then sell my current one myself. I have actually made money on cars before as weird as that sounds.
So if your going to be paying $600+ a month on a new Grand Cherokee with a lease, why would someone not just buy it? To get a $600 or less monthly car payment on a purchase would actually not require that much money down. So wouldnt it just be beneficial to buy it and be putting money into ownership, especially with these current low rates 1.49% or maybe even less?
It depends on a great many things. For me, I lease because I write a vehicle off for business, and thats much simpler and more straightforward with a lease. Also, depending on the state there are sales tax advantages.

Typically something like a Jeep isn't a great lease. You need something with a high residual (residual on my Lexus was 60%) and a low money factor (OP's certainly got that). When you factor in that the OP is going to be paying almost $700 a month for that Jeep with no money down, a 72 month finance at 1.49% is $697 a month! So...that may be a buy scenario.

If he puts that $11,500 down on the purchase, which I still wouldn't do because the rates are so low, the payment comes down to $529.55...

But, if you consider my Lexus I just leased, the payment is $700 a month, leasing saves me $200 a month over a 72 month, $340 a month over a 60 month. When you factor in my tax savings, for me on that car its a no brainer.
__________________
~Steve~
2014 Jeep Grand Cherokee Overland V6 4X4. Maximum Steel w/ Vesuvio Jeep Brown/Indigo Blue. Advanced Tech Pkg.
2013 Lexus GS350 AWD, Liquid Platinum w/ Flaxen. Luxury & Cold Weather Pkg
Previous Jeep: 2011 Grand Cherokee Laredo X w/Nav, QT1 & Trailer Tow
Reply With Quote
  #30  
Old 03-08-2013, 02:03 PM
sndrsk's Avatar
Member
My Jeep: 2013 3.6L WK2
 
Join Date: Feb 2013
Location: Des Moines, Iowa
Posts: 183
Thanks: 0
Thanked 2 Times in 2 Posts
Rep Power: 141858
sndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond reputesndrsk has a reputation beyond repute
Garage
Re: 2014 Overland ordered, look at this money factor

Quote:
Originally Posted by AAAA View Post
I've never leased a car. Is it normal to have life insurance and accident and health insurance on the invoice?
Those are add-ons that you can decline. I've never seen a dealership offer that, though.
__________________

Reply With Quote
  #31  
Old 03-08-2013, 03:41 PM
Premium Member
 
Join Date: Mar 2013
Posts: 33
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 542
ominous24 is on a distinguished road
Re: 2014 Overland ordered, look at this money factor

When telling him that I will not use the trade on the down payment because I would lose it in case of the car being stolen or totaled, here was his response:

Quote:
That is not true. I have experienced it first hand and had had customers go through it. It is up to you, but if that were to occur, you would get money back.
He doesn't seem to have an agenda either way on this, he is indifferent either way with it. My credit score is over 800 so it isn't like any down payment is needed.

So now you guys have me thinking, so tell me if my process is flawed as I await an email from my bank on their current interest rates. I take the lease for 36mo, 12k miles. I only put maybe 7k miles on a vehicle per year. At the end of the lease the vehicle does not have the estimated 36k miles, it has about 20k. The vehicle will be worth more than the residual so if I decide to keep it, I am buying a vehicle at the residual even though it is worth more.

I need to try to estimate the same scenario on an outright finance on 3 years down the road so I am waiting on my bank's best interest rate.
__________________
Reply With Quote
  #32  
Old 03-08-2013, 04:05 PM
torifile's Avatar
Member
My Jeep: 2014 5.7L WK2
 
Join Date: Jan 2013
Posts: 633
Thanks: 27
Thanked 13 Times in 9 Posts
Rep Power: 1316898
torifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond reputetorifile has a reputation beyond repute
Re: 2014 Overland ordered, look at this money factor

For about the 5th time, he's wrong. You have no equity in the car when you lease. If he's telling you that, you should find a different dealer because either he's ignorant or lying.
__________________
Reply With Quote
  #33  
Old 03-08-2013, 04:07 PM
Premium Member
 
Join Date: Mar 2013
Posts: 33
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 542
ominous24 is on a distinguished road
Re: 2014 Overland ordered, look at this money factor

Quote:
Originally Posted by SW03ES View Post
He's wrong. Car salespeople know nothing about leasing, especially Jeep/Chrysler salespeople because its really rare a buyer leases one. You get into luxury car dealers its way more common. Even then, I have never met a finance manager at a luxury car dealer who knows more about leasing than me, let alone a salesman.

I completely understand that, I spent 3 hours at a typical dealership a few days ago where the salesman just graduated from "car salesman university," the guy never even heard of the terms residual value or money factor.

Not to say this dealership where I have my order placed is flawless, but this is a very small, family owned dealership. They don't have a sales manager, they only have two guys who do all the sales and financing together. As we went through everything, we sat at his desk and he had his computer screen facing me the whole time.
__________________
Reply With Quote
  #34  
Old 03-08-2013, 04:08 PM
Premium Member
 
Join Date: Mar 2013
Posts: 33
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 542
ominous24 is on a distinguished road
Re: 2014 Overland ordered, look at this money factor

Quote:
Originally Posted by torifile View Post
For about the 5th time, he's wrong. You have no equity in the car when you lease. If he's telling you that, you should find a different dealer because either he's ignorant or lying.
Yes, I know what you are saying 100%. If I stick with a lease I will not be putting money down.
__________________
Reply With Quote
  #35  
Old 03-08-2013, 04:57 PM
Premium Member
 
Join Date: Mar 2013
Posts: 33
Thanks: 0
Thanked 0 Times in 0 Posts
Rep Power: 542
ominous24 is on a distinguished road
Re: 2014 Overland ordered, look at this money factor

OMG now I am just stumped, lol.

I can get 1.99% on 72mo.

vs.

.00001 with residual 52%, after 3 years I can get 1.49% for 36mo to pay off the remainder (if decide to keep the vehicle)

Any financial wizards out there to tell me the best deal?
__________________
Reply With Quote
  #36  
Old 03-08-2013, 06:39 PM
SW03ES's Avatar
Premium Member
My Jeep: 2014 3.6L WK2
 
Join Date: Jun 2011
Location: Gaithersburg, MD
Posts: 1,739
Thanks: 14
Thanked 39 Times in 34 Posts
Rep Power: 1303316
SW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond reputeSW03ES has a reputation beyond repute
Re: 2014 Overland ordered, look at this money factor

I don't think he's trying to screw you over, but he IS wrong.

Quote:
Originally Posted by ominous24
OMG now I am just stumped, lol.

I can get 1.99% on 72mo.

vs.

.00001 with residual 52%, after 3 years I can get 1.49% for 36mo to pay off the remainder (if decide to keep the vehicle)

Any financial wizards out there to tell me the best deal?
Lets think about this here. If you lease it and put nothing down, your payment would be $668.62.

If you financed at 72 months @ 1.99% with nothing down your payments would be $727.54

So leasing only saves you $58.92 per month.

Bear in mind that Ally charges you a fee if you buy out the lease, I want to say its like $2,000. Ally is the only lender that charges such a fee. So, your buy option is not $26.091, its really $28,091.

The total of your lease payments over 3 years is $24,070.32.

if you buy the car after the lease, the payment goes up to $798.36. (total of $28,740 over 3 years)

If you add the cost of leasing the car to buying the car afterwards, total cost to purchase is $52,811.28.

Had you simply bought the car from the get go your total cost to own would be $52,382.88

So leasing and buying here costs you about $500 more, BUT some states will make you pay sales tax and registration on the car again when you buy out the lease, so that makes it worse.

Bear in mind though, had there not been that $2k Ally fee, you would have actually come out ahead leasing and then buying, thats pretty rare and because of your incredible money factor.

Hope that helps!
__________________

__________________
~Steve~
2014 Jeep Grand Cherokee Overland V6 4X4. Maximum Steel w/ Vesuvio Jeep Brown/Indigo Blue. Advanced Tech Pkg.
2013 Lexus GS350 AWD, Liquid Platinum w/ Flaxen. Luxury & Cold Weather Pkg
Previous Jeep: 2011 Grand Cherokee Laredo X w/Nav, QT1 & Trailer Tow
Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
2014 SUMMIT ORDERED 2/20/2013,,NOW FOR THE WAIT! :: 2014 Jeep Cherokee Summit RUIDOSO JAMES Member Garage Discussions 4 03-20-2013 02:32 PM

Powered by vBadvanced CMPS v3.2.3

All times are GMT -5. The time now is 09:58 PM.


Powered by vBulletin® Version 3.8.8 Beta 4
Copyright ©2000 - 2014, vBulletin Solutions, Inc.
Copyright 2012 - JeepGarage.Org
The Jeep Grand Cherokee Owners Community