How To Negotiate A Car Lease!

You have decided to lease, you've seen those great ads in the newspaper and you are ready to head to the dealership to get that deal!

WAIT!!!

You might be able to save quite a bit of money by knowing what you can negotiate and what you can't.

First, know that the term of the lease (how long the agreement), the limit on miles, and the interest portion of the lease are formulas set by the leasing agent. Although you might have some choices, these items are set by the company.

Also, the residual value of the car, (how much the car is worth at the end of the lease-measured in percentage), is set by the agent. The higher this amount, the better for you! 50% or above is considered excellent!

However, what is not commonly known is that you can still negotiate the sticker price just as you would if you were buying a new car! Sometimes the salesmen won't tell you this if you don't ask! Don't let them tell you that because the car is leased, its price is set in stone! Just as if you were buying a car, find out the invoice price online or the dealer profit margin for that particular vehicle in which you are interested, and begin negotiating up from the invoice price. You'll do much better to do this than if you negotiate down from the MSRP.

When leasing, the MSRP is referred to as your Capital Cost and after you have negotiated down, you'll have an adjusted Cap Cost or Net Cap Cost. You can further reduce your Net Cap Cost by negotiating your trade in if you have one.

Some fees such as the acquisition fee (an up front fee that ends up in your Cap Cost) are non negotiable, as are licensing and registration fees. Document fees are often set -but you can always ask if these seem unreasonably high.

Before you are really ready to negotiate, you should know exactly what vehicle you are looking for, including the package, trim and options you want so that you are comparing apples to apples.

Know your terminology so that you can bargain as an informed shopper!

When you are really ready, an excellent option is to send out an email to 7-10 area dealerships asking for the full information on the terms of the lease, their best Cap Cost and to disclose all fees and interest rates (known in leasing as the money rate). When they know that you are informed it is harder for them to hide some of the information. When you get your best offers, then you can talk to them or continue to negotiate by email. KNOWING how to negotiate a car lease gives you the confidence to save up to thousands over the term of your lease.