You Get What You Negotiate
Leases are absolutely negotiable. Some factors are more fixed than others, many depend on the lessor and the dealership, and several will vary based on you, the lessee. To get the best deal, be informed, shop around and prepare to present yourself in the best possible light.
Knowing the key factors that will influence the total cost of your lease is imperative to negotiation. These factors are:
- Selling Price
- Acquisition Fee
- Security Deposit
- Taxes and Fees
- Net Capitalized Cost
- Residual Value
- Money Factor
- Disposition Fee
The Selling Price
When you’ve made it to the dealership, and are ready to lease a car, keep in mind that many factors of your lease are decided by the lessor- not the dealer. Of course, the dealer communicates with the institution that’s financing your lease, and will work with them to get you the best deal, but there is really only one number that you can negotiate with the dealer: the selling price.
Reducing the Money Factor
While the lessor, not the dealer, will set the money factor, there are certain things you can do to ensure you get the lowest money factor that you can qualify for. Find out how putting down a security deposit, or even multiple security deposits, or reducing the Net Capitalized Cost with a down payment may improve the terms the lessor will offer.
Take Advantage of Promotions
Another thing to think about before heading to the dealership is when you lease. Many dealerships have end-of-year specials and holiday deals. But if you don’t want to, or just can’t, wait for the next holiday weekend, simply waiting until the end of the month may get you a great deal. Car dealerships also tend to lower prices between July and October to make room on the lot for the next year’s models. Lessors also will offer specials, through their partner dealerships, so while these may not be advertised directly to you, the consumer, ask the dealer about available offers. Read our article about holiday weekend shopping for more about promotions.
Before you go to the dealership, it’s always a good idea to do some online research about the prices and dealers in your area.