ayap

Although it's still a few months before my lease ends, I called Audi Finance to ask about my options.

END OF LEASE BUY OUT:
The Pay off amount, they said, is non-negotiable.

INTEREST RATE:
If I got a loan, it was like 7% - 11% ... wow! interest rate seem too high.

EXTENDED WARRANTY
Then they said extended warranty is between $1,600 - $3,000+

What's your experience?

perlvater

1. When the lease ended on my A8 recently the dealer offered me the option to buy the car 2 month before the end of lease at a very large discount from the "end-of-lease" buy-out price. I sent him a list of the Manheim auctions to make the case and received a 20%+ discount form the quoted price.

2. As for the extended warranty-
a simple fact of math (not understood by most people) is that it does not make economic sense to ever purchase insurance or warranty unless 1.) you either know something about the product that the insurer does not know or 2.) if the loss would affect you in a negative way that "you could not afford". Obviously the cost and the probability of such defects and cost of repairs is very carefully calculated by the insurance or warranty provider and they make a handsome profit in addition to the cost of administering the policy. It would be best if each person would put the money for the various costs of such warranties/insurance premiums in a savings account and then pay out each bill form that. (Obviously this is for smaller things for most people.) Purchasing an extended warranty is very similar to gambling in Vegas. Some people make money, however, the vast majority loose money because the house takes a cut and makes it a slightly unfair bet. This is a fact or the insurance companies and extended warranty companies would all be bankrupt!

April

them if the car sells at auction for less than the residual value on the lease. Hence they have no incentive to bargain with you.

However, the Audi dealer (any dealer) is often able to buy the car out for less than you can yourself. They need to call in your vin# and contract number and get a dealer direct buyout from AFS.

Now they aren't going to sell it to you for what they pay for it, but if you explain what you want to do, then this may fly. Just offer to pay them a flat amount over their cost, and see if the numbers make sense. Say $750 to $1000. It's a slow time of year, so that is in your favour.

They can also usually offer the extended factory certified warranty for less as well. Same goes for financing - the dealer can take your credit app and shop it among several lenders whom they think will be a good fit. It's a bad time to be shopping for car loans, but at least you'll know where you stand.

For something this complicated and ticklish, look for the most experienced Audi Brand Specialist (ABS) who has done this before. Every dealer has at least one, and often several. Ask in the regional AW forum for whom they recommend. Barring that, visit the service manager and ask them from whom they would buy a car.

NOLAessate

The lease on my '05 A6 3.2 ended in late May, and I started communicating with AFS 2.5 months before lease end. There was no movement on the residual at any point. Initially I was offered several interest rates (3.9% w/$650 gift card, 5.9% w/$1200 gift card). As we got closer to lease end, I was offered 5.24% (which I was told was their standard rate) for up to 60 months. There was no mention of a warranty until the last set of communications close to lease end, at which time I was offered a free 4 yr/48k mile exclusionary warranty (and was told that the value of said warranty was $3030).

Obviously AFS would prefer that you buy rather than return the car at lease end. Their enthusiasm for getting rid of the car by sweetening the pot with incentives is going to depend on the specific model and how many of them are already in the pipeline, as well as the proximity to lease end. Additionally, just as AFS periodically adjusts money factors and interests for dealers, the same fluctuation seems to occur with lease end negotiations. If you are not happy with the original set of numbers they throw your way, wait a few weeks and try again. Also, with the current mess on Wall St and the credit crunch, you may see some rates inflated above what I encountered several months before.

Of course, depending on your relationship with your dealer, and your dealer's relationship with AFS, there is always the possibility of having the dealer get the car for you (as was already mentioned).

My thoughts about warranties, FWIW. Yep, they're insurance policies and similar to the Vegas issues. If you bet wrong and lose, however, the costs can be staggering. The trans went out in my A6 at 6k miles and was replaced with a new (not rebuilt) trans. There was so little warning that I barely got it into the nearest dealer before it went into limp mode. The thought of being 2000 miles from home on vacation and finding myself with a $10000 bill for a new trans is more than enough incentive for me to put my money into an extended warranty. My '04 TT 3.2 has one of Bruce M's exclusionary policies, my '02 S8 also has a policy from Bruce, and my '05 A6 has the coverage provided by AFS. With 3 Audis (all outside of the factory warranty period) in my garage, the likelihood of something expensive happening to one of them is similar to house odds in roulette. At least I can control my exposure.

Good luck with your negotiations.

A6Gary

credit union. Given the sales downturn in the automobile business, you should be able to get both a lower buy-out price and a lower interest rate, assuming you have an excellant creit score/history.

swifter

you want to return the leased car and lease another Audi, esp. if the one being returned is, say, over mileage? Can the dealer help provide other incentives, too, such as a lower MF rate?

April

very good traction. If the car is not something they can use, then there is less wiggle room. There still is some room, just not as much. Basically the dealer is going to end up paying your mileage overage - and that money needs to come from somewhere in the deal.

As for money factor, it's normal for a dealer to mark it up a tiny bit over the base rate. Usually a 1/4 of a point. However, the leasing company (be it AFS or another bank) does not usually lower the rate for returning customers unless there is a program currently in place, thus the dealer has no additional savings to pass along to you. It all depends how much the lease bank wants to do business.

Right now, capital is in short supply, so smoking deals from this past Spring or Summer probably won't apply any longer. For purchases, shopping local credit unions and banks to compare with the national stuff that dealers use, is a good way to ensure you get the best rates. On leases it's much trickier. If you can afford to wait, better deals are bound to come along again.

philm35

I disagree.

On a car as expensive and complex as an Audi A6, one repair can eat the cost of a warranty.

My previous car, a '98 Volvo V70 AWD was a perfect example. After the factory warranty ran out, it needed work on the transmission, the cooling system, the driveshaft, the brakes, the window switchgear, and a bunch of other stuff. My extended warranty more than paid for itself.

mdwredb7

AFS has a "remarketing program, that may allow your dealer to sellyou the car back as a CPO (no need for an aftermarket warranty) for less than the residual amonut on your contract. You can also take advantage of lower rates being offered on CPOs as opposed to the rates being offered on non cpo Audis...

GundoA6

I was trying to buy out our A4 at lease end - we have a great deal, and they just don't seem to exist anymore.

Audi would NOT negotiate the lease end buyout price to be anything different than stated.

I talked to them yesterday, current interest rates are 6.5% for a loan between 1 and 6 years.

Time for swapalease! (no affiliation)