How to Negotiate a Car Lease

Being prepared before walking into any car dealership is the key to getting a great deal. Knowing the terminology and what is negotiable in a car lease will let the dealership know that you've done your homework and expect fair lease terms on your new car.

Research the car you want to lease online and find out what the MSRP is Manufacturer's Suggested Retail Price). A good deal for a negotiated selling price is $500 to $700 under that number. An even better deal is $800 or $900 under it. Have that number in mind when you go to the dealership.

Visit the dealership and choose the car you want to lease. Ask the dealer to tell you what a two- or three-year lease would cost. Don't go above a 36-month lease; the car will be out of the warranty at that point. Tell the salesperson you don't just want to know what your monthly payments would be but what the actual negotiated selling price of the car is.

Don't accept the first number the salesperson gives you, especially if it's not close to the number you had in mind. They'll expect you to negotiate it down.

Leases use a complicated system to determine the finance percentage you'll pay each month. Unlike "buying" a new car where the better your credit rating, the better your finance percentage, a lease is not as flexible. They base it on something called a money factor, which translates to a percentage. This is determined by the car company (not the dealership) and is not based on your credit rating. Banks do not typically offer financing for a new car lease so don't bother to comparison shop.

Ask if the dealership is running any rebate specials on leases. This could knock $500 to $1,000 off the price. If you graduated college recently, they may have a special rebate for that too.

You will be given the option of having 12,000 or 15,000 miles a year allowed for your mileage and the price difference will be between $50 to $100 per year. While it's tempting to go for the extra mileage, keep in mind that many car makers will forego the extra mileage at lease turn-in. So, although they tell you that every mile above the limit will cost up to 35 cents per mile, they may forgive that number if you lease another vehicle from them.

Don't let the salesperson talk you into choosing a car that has more options than you want. For example, the only difference between two identical cars may be that one has car mats for $175. Since they're worked into the car's price, you're paying a small monthly percentage for leasing those mats. You can buy car mats from a store for a fraction of the price instead.

Before leaving the dealership, make sure you know the MSRP, the negotiated lease price, the length of the lease, mileage allowance and what the bottom-line monthly payments will be. Ask the salesperson about the acquisition fee. This is a non-negotiable fixed price set by the car maker that is attached to every lease deal.

Go to the lease calculator online (see Resources below) and plug in the numbers to see if you come up with the same figure as the dealership. If the numbers match and you are satisfied with that price, make a deal with them. If not, call your salesperson and see if you can negotiate the discrepancy.


  • You might also consider taking that final negotiated number and presenting it to another dealership. However, it may not amount to much on the bottom line.