 |
How is the price of a car at the end of the lease determined?In: Car Buying |
Answer
The Kelly Blue Book is the "Bible" of the Car Industry. The "Lease-end" Value is a projection of what the car will be worth "Wholesale" (not Retail) at the end of the "Term" This assumes you stay within the miles allowed for the Lease. Generally 10-15K per year.This also assumes the condition of the vehicle is in the "normal wear and tear" guidelines.
Answer
Actually, lease-end values are available in the ALG guide published monthly. ALG is the bible for the lenders who do leasing or any other residual-based financing. Kelly Blue Book, NADA Bluebook and Blackbook are used principally to determine trade-in value, loan value or suggested retail. Kelly is used primarily in the western states but NADA bluebook is the standard for the central/southwest/eastern parts of the US. Bluebook value and " residual value " are not the same thing, so don't confuse the two-they are in no way related.
Answer
When entering a lease please know that there are 2 kinds of lease 1) open end (bad) 2) closed end (good) This is baced on Nebraska law and lease. As far as I know open ended leases are not offered any more but please watch for them. If you enter a closed end lease the price of the car is set at the dealership before you ever leave. The way we determan that price has to do with the residual this is "the amount that the leasing co. projects you will use of the car".I.E. you lease a Impala for $20000 the residual is 50% we take $10000 and put it away the other $10000 is taken times a lease factor(apr) and divided by term this will give you payment. Now your price in my lease is for the used car at full term is $10000 + a "fixed purchase price increment" at our dealership $500 + a $50 Doc Fee for a end price of $10550. YOU SHOULD KNOW THE PRICE BEFORE YOU SINE A LEASE!!There are opts. at the end of a lease like turn the car in,buy the car and keep it or buy the car and trade it.
|
|
|
First answer by Kislen. Last edit by Sttam. Contributor trust: 156 [recommend contributor]. Question popularity: 222 [recommend question]
|
Research your answer: |
Can you answer other questions about Car Buying?
|
|
Answers.com > Wiki Answers > Categories > Cars and Vehicles > Car Buying > How is the price of a car at the end of the lease determined?
Our contributors said this page should be displayed for the questions below. (Where do these come from ) |
| If any of these are not a genuine rephrasing of the question, please help out and edit these alternates. |
