Need help with SQ5 Lease Terms- Is This a Good or Bad Deal?

[robwrongshoes]

I found a 2014 that I thought I might buy for $45K for SQ5 w/ 26K miles, but the dealer is really pushing me to consider a 36 mo lease of essentially the same car options wise, for $872 a month.

The following terms were offered out of the gate. I've never leased before, so I have no idea if this is a good or bad deal. Any help/input would be appreciated.

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MONTHLY PAYMENT: $872.01
MSRP: $61,900
Cash upfront: $3,000
Rebate: $1,000
Price (after cash upfront and rebate): $57,900
Rate: .00245
Residual: .60
Mileage Per Yr: 10,000
Cents/Mile: .25
Acquisition Fee: $795
Gov't Fees: $564.50
Taxes: $3,062.13
Doc Fee: $150
Maint Premium (Audicare): $849
Total Initial Payment: $4,000
Residual: $37,140

[S-Fore]

Tell the SA that you want $4k off sticker, plus the rebate/loyalty whatever Audi has available now. Thats a solid deal, basically 6% off sticker.

So the Cap Cost will be $56,900 before taxes and cash down.

Don't feel prisoner, get on the internet and start reaching out to local dealers. Someone will have to make their numbers and take the deal. Maybe you have to drive a few hrs to get the car, but hey, a new car is a new car. You have already driven one. As long as it has the options that you want, they're all the same...

[LINDW4LL]

Sounds like a bad deal to me, but I'll let the lease experts chime in.

Personally I'd go for the '14 and save yourself the money since it has all the same options, and low miles... '14 vs '16 does not matter. My $0.02

[robwrongshoes]

Thanks for the feedback. You are so right. Once you stop searching for the needle in the haystack (low mileage used 2014 or 2015 in w/ tech pkg, 21's, carbon atlas inlays and black Nappa leather), you're suddenly free to just "order it up".

Out of curiosity, is .00245 rate and .6 residual good, just average or bad? And are these even worth trying to negotiate, or is it best to just focus on Cap Cost, cash required upfront and the monthly payment?

[robwrongshoes]

LINDWALL, I was sorta of the same mind, but Edmunds suggests retail on the 2014 w/ 26K miles (not really "low" miles) outfitted w/ black nappa, carbon atlas, tech package, 21s is $42,500, yet the dealer will not sell to me for less than $45,500. That's a $3K premium over Edmunds retail TMV in "outstanding condition", and the car is lacking a 2nd key, which really pisses me off, since you gotta pony up $350 right out the gate for another one. I do agree though that there's opportunity to get more off the lease by talking to other dealers, and having them compete for my business. In the meantime, if the 2014 doesn't get sold, who knows, they may realize they're in a position to lose my business outright to another dealer, and come back w/ a better offer on it as well.

[S-Fore]

Residual is set by AoA, you can search that on the web and get the current program(s). Money factor, well that is also set by your lender, however, it can vary based on your credit rating or lender to lender. Money factor is calculated X 2400 to understand it from a APR% perspective.

Thanks for the feedback. You are so right. Once you stop searching for the needle in the haystack (low mileage used 2014 or 2015 in w/ tech pkg, 21's, carbon atlas inlays and black Nappa leather), you're suddenly free to just "order it up".

Out of curiosity, is .00245 rate and .6 residual good, just average or bad? And are these even worth trying to negotiate, or is it best to just focus on Cap Cost, cash required upfront and the monthly payment?

[robwrongshoes]

Thanks S-Fore. What else should I watch out for in negotiations? I know there's some pretty typical upfront fees, including doc and acquisition fee that will need to be paid, along with any cash upfront, and the first month's payment. Will they potentially surprise me with other "hidden" fees? Also, do people tend to have any luck negotiating acquisition fee down, or eliminating entirely?

And last newb question for now-- is $0.25 cents/mile good? Historically, I've run well under 10K miles/yr, so I'm not too worried about going over, but if it's negotiable, and that's higher than average, I'd naturally be inclined to negotiate down, on the off chance I run high...

[Mops@Nemesis]

Did not read replies, but BAD deal. My MSRP was just under $63K, $1K down, and I'm paying $663.

[bomb39]

WTF, what mileage lease?

[DBFL]

The first thing you need consider is how long you plan to keep the car. If you get a new car every few years, leasing is a good option. If you plan to keep it longer than three years you may want to purchase.
Also, it looks like they are trying to sell you the new car at full MSRP. If you get a new car (buy vs lease doesn't matter) you are entitled to the manufacturer rebate. As an ACNA member I get a voucher for 6% off MSRP PLUS any rebates currently offered. The dealership still makes plenty of money with that deal. So I'd definitely ask for 6% off plus the $1000 rebate.
Keep in mind that cash down does not effect the end result of a lease. For example, your monthly lease payment on a 36 month lease is $800 with zero down. Any money you put down comes out of the monthly lease payments. So if you put $3600 down on that same deal the payments would drop to $700 a month. Your total payments after 36 months is the same in either scenario. Money down doesn't change the residual.

[Mops@Nemesis]

WTF, what mileage lease?

8K

[bomb39]

8K

Got it.

For a second I was regretting my purchase :)

But I drive close to 20k a year.

[seanentrust]

FYI lease mileage only matters if you give the car back. If you keep it, sell it or trade it in it doesn't matter how many miles.

But $863 for a lease with almost $4000 down seems insane! I would expect an s6 or s7 for that payment!

[hypoluxxa]

I got a 2016 SQ5 last week for a little less that 54K, Sticker was 62,800. It is a 3 year lease. Put 4K down pay less than 650 with ALL the warranties they threw at me. Service and what not.

[robwrongshoes]

Thanks everyone, this is really helpful. I can feel it now-- I'm going to get a great deal.

Hypoluxxa-- it sounds like you got your SQ5 well below invoice. Are you counting your money down in that 54k figure? I was told margin is 6%, which means your invoice was around $58900, so $54k would be a killer deal at $4,800 below invoice! If others pulled that off, I'm definitely holding out for same or similar!


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[DBFL]

Thanks everyone, this is really helpful. I can feel it now-- I'm going to get a great deal.

Hypoluxxa-- it sounds like you got your SQ5 well below invoice. Are you counting your money down in that 54k figure? I was told margin is 6%, which means your invoice was around $58900, so $54k would be a killer deal at $4,800 below invoice! If others pulled that off, I'm definitely holding out for same or similar!


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Margin is more than 6%. I bought my S4 at 6% off MSRP (plus rebates). I could have gotten a better deal on a different S4. But I wanted one with a 6MT and some other specific packages. There were none on the lot and only one that met my criteria within 1500 miles. So the dealer did a dealer trade and had to pay to transportation for two cars to do the swap. Had I bought one off the lot I could have saved quite a bit more. Had I ordered the car I could have saved a bit of money as well, but unfortunately I waited to long and they had already stopped production of B8.5 S4s.
Anyway, the absolute most you should pay is 6% below MSRP and then take off the additional $1000 rebate as well. I'd start negotiations at 10% off.

[robwrongshoes]

Wish I had started at 10%. I wasn't too far off though. I told them all that I was looking for $5k + $1k dealer incentive. That's close enough to 10%, I suppose.

Anyway, at this point I have a dealer agreeing to above, with 00180 rate for a midnight blue SQ5 with MSRP of $62,730. $1k incentive would be applied to Inception fees, so basically, almost no money down and monthly payment close to $800. Thanks guys for the pointers!


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[Emurray]

Base money factor is marked up from .00120.

[Emurray]

Just leased a sq5 for my wife and after rebates discount was just over 11% off msrp of 63500. Payment is 675 with tax in California 36 months and 12k a yr and audi care. 2k drive off for the fees. Not the best idea to put money down on a lease. Use that money to do msd which will lower the base money factor thus lower your payment. Plus you will get that money back at end of lease. Hope this helps and good luck.

[robwrongshoes]

Thanks Emurray. Very helpful. I want that kind of monthly payment, and the higher mileage.

So if you did two MSDs, they'd be used to pay the last two month's payments?

Also, it sounds like you had access to another incentive beyond $1k I have access to. Can you provide details, if so?

Thanks again.


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[DBFL]

I just noticed that you listed taxes of $3000+ in your initial post. Is the dealer saying that you have to pay that upfront? Or is this to show the taxes over the life of the lease, which would be split into 36 monthly payments? Maybe your tax laws are different than here. I've never had a dealer list it like that. They usually just show the amount of tax on each payment. I don't remember the specifics, but if you buy out a lease in Florida it completely changes the taxes on paid/due on the vehicle. It's something you may want to look into.

[jpsjr]

Bad deal. I just bought my '16 SQ5 2 weeks ago and paid $54,060 with Audi Care and Audi Tire/Wheel Pkg. List was $64,750. Right now you can really get a great deal if you shop around and stand firm on discount. There's also a lots of money that Audi is throwing at the dealers to get these vehicles off the lots.

Jose

[seanentrust]

just curious what the monthly payment would be if financed? It doesn't seem like it would be much more if anything so why not just do that?

[Emurray]

I had the $750 Rebate also since I had just leased a S3 in February. Yes msd is = to 1 month payment. Edmunds lease calculator works really well. I always check the dealer numbers because I got nailed once when the dealer bump up the cap cost that is used to calculate the payment. I think between 10k and 12k miles was $ 12 dollars more a month.

[LINDW4LL]

just curious what the monthly payment would be if financed? It doesn't seem like it would be much more if anything so why not just do that?

A 36 month loan would be ~ $1600/mo, or $980 for a 60 month (@ 1.99% APR)

If one only plans to keep a car for 3 yrs anyway, leasing is less money out of pocket and total cost comes out about the same in the end. And you save $1-2k on sales tax as you only pay tax on your payments rather than the entire value.


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[delz05]

Don't have all the particulars with my lease but I got a 2016 3.0T Q5, S-line, black optics, tech package, Sport Interior and a few other small options... sticker was 54860.00, discount was 6860.00, 1750.00 in rebates, 6500.00 trade equity, 15k miles per year @ 3 years, Audi Care and wheel protection... 540.00 per month... with a residual of 30,000.00 to purchase after the 3 years are up. Dealer said to expect a buy out offer after 2 years because the new Q5 model will be out... I said at that point, it will be SQ5 time!

[robwrongshoes]

All-- After the usual back and forth, I've received a much better offer. I will share more details once I finalize the deal, but the quick and dirty = no down payment, and much lower monthly payment, thanks to additional money off MSRP, and lower money factor.

DBFL-- $3K taxes noted previously are total amount due over 36 month term. You would pay equal installments against that total over the life of the term.

delz05-- Thanks for sharing details on your lease terms. You got a great discount, and certainly had access to more rebates. Perhaps even more importantly, you had a trade-in. We unfortunately don't have a trade-in. It will be interesting to see what the dealership proposes for wheel protection and all that other stuff. Historically, I've ignored products like that, but it appears I'm changing stripes.

[seanentrust]

Don't have all the particulars with my lease but I got a 2016 3.0T Q5, S-line, black optics, tech package, Sport Interior and a few other small options... sticker was 54860.00, discount was 6860.00, 1750.00 in rebates, 6500.00 trade equity, 15k miles per year @ 3 years, Audi Care and wheel protection... 540.00 per month... with a residual of 30,000.00 to purchase after the 3 years are up. Dealer said to expect a buy out offer after 2 years because the new Q5 model will be out... I said at that point, it will be SQ5 time!

$540 a month and 15k a year? I need this deal! How much did you have to put down?

[S-Fore]

How much did you have to put down?

This for starters...

6500.00 trade equity!

[buggravy]

I've been following this thread closely, as I'm probably just a couple days away from leasing a '16 SQ5. Luckily, there are a buttload of Audi dealerships within spitting distance of me, so it has been pretty easy to get what appear to be pretty solid offers by telling dealerships I'm shopping nearly identical cars at competing dealerships for the best deal. So far the best deal has been 10% off MSRP +$1750 rebates, but that was on the most heavily optioned highest price car. This is all with virtually no haggling yet, and its seems like $3K total drive off and payments of around $625 - $650 including tax are easily doable on 36mo/12K, possibly better. This will be the first time I've ever leased a car though, so trying to come up to speed on all that. What aspect of the lease is it that is actually negotiable? Selling price obviously, but I'm not clear if MF and residual are variables, or preset.

[robwrongshoes]

buggravy- let me know where you net out. I'm sticking with $0 down and 10k miles/mo over 36 months on $62,730 MSRP. It looks like I'll pay $228 in inception fees after rebate and $778/mo after that. I'm picking up tomorrow. Will provide an update once I've wrapped up.


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[delz05]

$540 a month and 15k a year? I need this deal! How much did you have to put down?

Nothing out of my pocket... just as indicated

[robwrongshoes]

Trade-in helps, as noted. Wish we had one!


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[buggravy]

Well, unless something goes south in the next 24 hours, I'm signing the lease on a '16 SQ5 tomorrow. Feel like I got a decent deal, though I think I missed out a little by snoozing at the end of June. MSRP of $62,600, paying $3K drive off, and $630/month (including taxes, which are 9% in LA county). 36 month lease, 12K mileage. Looks like I'm ending up with Daytona Gray w/Black/Magma interior, and Black Optics. Pretty pumped.

[SQive]

Congratulations!
If you take a road trip to Texas, I'll show you what a bought one can do.

[buggravy]

Well, unless something goes south in the next 24 hours, I'm signing the lease on a '16 SQ5 tomorrow. Feel like I got a decent deal, though I think I missed out a little by snoozing at the end of June. MSRP of $62,600, paying $3K drive off, and $630/month (including taxes, which are 9% in LA county). 36 month lease, 12K mileage. Looks like I'm ending up with Daytona Gray w/Black/Magma interior, and Black Optics. Pretty pumped.

Well, that actually went South. Bit of a bait and switch by the dealer, with a dog ate my homework kind of excuse. Anyway, back to my first color choice, and only slightly higher deal. Sepang/Black optics, black int. & red calipers. I'm much more excited about this color, and am only at $20 more a month. Pics tomorrow, barring something unforeseen.

[NC_Detail_Garage]

Nothing out of my pocket... just as indicated

What do you consider the $6500 trade equity??

[Audi_Salesman]

Bad deal. I just bought my '16 SQ5 2 weeks ago and paid $54,060 with Audi Care and Audi Tire/Wheel Pkg. List was $64,750. Right now you can really get a great deal if you shop around and stand firm on discount. There's also a lots of money that Audi is throwing at the dealers to get these vehicles off the lots.

Jose

I need to know what dealer you got that deal from so when I get my wife a SQ5 I can go there. That price is way better then employee pricing.


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[delz05]

What do you consider the $6500 trade equity??

remy... not sure what you are getting at... my information speaks for itself. I am fully aware that the equity is a cash value, but as I said, I took no money out of my pocket... no sales tax, no lease fee, nothing. Just as I indicated... trade in only, with discount off MSRP. I hope this clears up your confusion.

[sshah]

Well, that actually went South. Bit of a bait and switch by the dealer, with a dog ate my homework kind of excuse. Anyway, back to my first color choice, and only slightly higher deal. Sepang/Black optics, black int. & red calipers. I'm much more excited about this color, and am only at $20 more a month. Pics tomorrow, barring something unforeseen.

What dealer was this? Looking to get a few quotes. Anyone else with a good deal who wants to share the dealer name and rep that would be great?

Thanks