Here’s How to Tell if You’re Getting a Good Lease Deal on Your Acura
If you're looking for a new Acura, leasing might be your best option. It's not the only way to get into a great pre-owned or brand new Acura car and it does come with some advantages over buying outright like lower monthly payments and no maintenance cost to name a few.
In this article, we will break down the different variables in a vehicle lease. First, let's talk about residual value - what to expect from your vehicle when you return it at the end of a lease agreement.
One thing that turns people off is comparing numbers; some auto dealers may express their prices differently than others making it difficult for customers to know if they are getting a good deal or not.
To help our clients decide between leasing and financing a new Acura, here comes our guide on how to evaluate leases so you don't get duped into paying more than you should.
>>> Need Help? Call Us Now at 630-521-3362 to Speak with an Acura Lease Specialist <<<
Residual Value – What Is It and Why You Should Pay Close Attention to It
The residual value on a vehicle is the estimated worth of your car after the lease ends. If you don't know what that means, it's how much someone would have to pay for your car at end-of-lease minus depreciation and excess wear and tear.
High residual values mean lower monthly payments since there will be more equity in the leased vehicle.
The first thing you should do when leasing a new car is to check out its Residual Value (also known as an expected Trade-In Value). The higher this number, the lower your monthly payments should be.
How much you will pay monthly to lease that Acura sedan or SUV depends on three factors:
1. Sales price and interest
2. Credit Score – the lease offers that you see advertised are usually for people with a perfect credit score. That doesn’t mean you won’t be able to lease a vehicle with a less than perfect credit score but your monthly payments will be higher.
3. Lease Term – that includes the length of the lease, the initial payment, and possible charges at lease end.
One of the most important things to understand when leasing a car is what it will cost you in total. The residual value at the end of your lease period determines how much you pay for depreciation and interest over three years, so make sure that's clear before signing on dotted lines!
I know this sounds very dry so here's an example: Say you leased a $50,000 Acura MDX with 50% residuals meaning you are going to have to pay $25,000 plus interest in 3 years.
Money Factor – Here’s What You Should Know About It
The next most often used phrase after the residual value is the money factor. Think of it as an APR. The money factor can usually be expressed in one decimal, like 0.004 for example, but all you have to do is convert it into an actual APR percentage by multiplying the number x 2,400! For instance: If a dealer offers up this weird decimal rate (0.004) then multiply that with 2400 and get 9.6%!
When you see the money factor represented by a whole number, that means all you have to do is divide it by 2.4. One thing worth mentioning though - the financial institution decides what this value will be and not the dealer.
Read the Final Print Before You Sign Your Acura Lease
It's easy to quickly skim over all the numbers on a lease agreement and think you're getting an amazing deal. But what about those fees that seem small but can add up in the long run? You may not even notice them because they are so tiny, like a $500 disposition fee or a $400 acquisition fee. They might seem insignificant but they add up.
For that reason always read ALL of the fine print before you sign the lease agreement! Leasing a car might seem complicated and even scary but it’s not once you understand the basics. To check out our current Acura lease deals and talk numbers with our lease specialists either stop by our dealership in Westmont, IL, or give us a call at 630-521-3362.