Understanding Auto Leasing: Part 5 – Closing the Deal

negotiating a dealFor those who really like driving a new car every couple of years, vehicle leasing makes a whole lot of sense. It is a general misconception that you can’t “haggle” a lease the way you can negotiate on the price or interest rate of a vehicle you want to purchase. You can actually get a great deal on a lease, not only by looking for specials and incentives, but by using sharp, smart negotiation skills.

When you discuss your leasing options with a dealership salesperson, you should make it clear that you are educated about leasing and that you would like to negotiate a selling price. Solid preparation is more than half the battle in a negotiation, and they’ll know they can’t push you around.

Locate the Car You Want Before You Begin Negotiations

Before you jump into negotiations you should know exactly which vehicle you want to lease. You should also know that vehicle’s standard MSRP, and what deals and specials are already in place for it. To help you search, keep the following in mind:

  • Automakers usually advertise deals with low monthly payments, no cash due at inception, or both. It is actually best to get a deal with no down payment required, because If something happens to the vehicle during the start of your lease, you will lose the money you put down.
  • Once you find a vehicle that has specials like those described above, your next step is to locate the vehicle at a dealer and request a quote. Contact the dealer to make sure the vehicle has the options you’d like. You should be able to get several quotes from several dealers.

Negotiating and Closing the Deal

Some salespeople will tell you that it is impossible to negotiate the lease price (or capitalized cost) of a vehicle, which is the amount that is being financed through a lease, but this is the figure that you do want to talk down. It is very much to your benefit to know what other people in the area are paying for the same car. You can find this out for free from TrueCar.com. Ask about rebates, specials, dealer incentives, and discounts. Ask about all fees that will affect your costs, like acquisition fees.

Pay attention to the following tips while you negotiate:

  • Always negotiate the cap cost or lease price instead of payments. Remember, it is NOT true that the cap cost is not negotiable.
  • Find the dealer invoice cost for your chosen car.
  • Never let the salesperson know how much you love a vehicle.
  • Make it clear that you are willing to walk away if the negotiation does not go in your favor.
  • Do not expect to be in and out. Proper negotiation takes time.
  • Do not allow yourself to be intimidated or confused.

After you have settled at a fair price, make sure to carefully go over the lease agreement. Double-check all the calculations, as detailed in “Part 3: Calculating Costs.”

You did it! Now you have to make sure you hold up your end of the bargain. For more information on what happens after you drive away with your leased vehicle, stay tuned for our next installment, “Driving Into the Sunset.”

March 4, 2013 by Jamie Rettig