MRSP / Monthly Payments

[nj2Type-S]

in buying a new vehicle, how much would one save by negotiating the MRSP as opposed to the monthly payments? i've heard on numerous occassions that negotiating the MRSP of the vehicle is better but i don't fully understand as to why this would be true. thoughts?

[The Cosworth]

MSRP is what you will actually pay in the end, if you just negotiate the payments you are still paying the price they set out before, you could just be paying more interest over a longer period of time. (what they will do is either extend your payments for longer, up to 8 years on a new car, or try and drop the bank rate (unlikely), or throw in your pro-pack and things like that)

If you can get the MSRP down and a decent interest rate then your laughing

[Redlyne_mr2]

Rates cannot be negotiated so all you have left to negotiate is MSRP.

[adam c]

all depends on the vehicle

some dealships won't budge some will.. the more u negotiate the more you will save..

simple..

[Aleks]

What car is it? You negotiate from Invoice cost up not from MSRP down. This works well for most makes. Rare cars/ hi demand ones you pretty much pay full price tho.

[TomcoPDR]

Can you negotiate the MSRP if you're going to lease? Or are the lease rates set by factory (per model)

[Crymson]

I would think that lease rates are based on MRSP, but people ususally on think in terms of their monthly payment.

I'm sure salesmen jsut drool when someone comes in and in response to "how much are you looking to spend" they hear "under 500$ a month", because that means they get to sell a vehicle for full price.

[benyl]

Yes, you can negotiate on a lease.

The residuals are set based on the MSRP. Anything you negotiate down from there comes off your payment.

[nj2Type-S]

Originally posted by Aleks
What car is it? You negotiate from Invoice cost up not from MSRP down. This works well for most makes. Rare cars/ hi demand ones you pretty much pay full price tho.

i was looking to finance a 2008 civic si sedan.

[Aleks]

That's going to be tough. The markup on those is 1200-1500 but I doubt they'll pass on any more than $500 off the price. Try and get the lock nuts and mats thrown in as well as cheap 3m.

I would lease that car over 30 months with 0% down and under 400 / month payment at 1.5%

[nj2Type-S]

the monthly lease rates are awesome, for sure, but i'd much rather just own it after 4 yrs.

but aren't the monthly payments calculated from the price of the vehicle, interest plus all the other taxes and whatnot? so say for example, with $0 down for 48 months purchase financing, a civic si sedan will be $651.65/month. if, for example, the monthly was negotiated to go down to $625/month, wouldn't that mean that they've lowered the MSRP on the vehicle since all the interest, tax, etc is based on the MSRP?

i apologize for my seemingly vast knowledge of this subject and thanks for the replies! :thumbsup:

[Strider]

Yes... if you stick to the same term, same interest rate then you're effectively negotiating on the total price of the vehicle. It's generally recommended that you negotiate based on the total price as opposed to payments though, just because it's a lot cleaner.

Where it gets bad is people who buy based on how much they can afford per month and end up extending their loan to decrease payments.... in the end, they don't save anything (and in a lot of cases, end up paying more).

You say you'd rather own the vehicle after 4 years... but at 1.5% lease rate, you may as well lease for 4 years and buy it out at the end. In the meantime, the difference you would have paid between finance payments and lease payments can sit in a high interest bank account (or other investment vehicle) to earn extra money until you withdraw it to buy the car out.... Maxboost crunched all the numbers and it turned out he saved $600 on an Si by leasing (in addition to investment profit) vs financing... search up the thread.


Originally posted by nj2Type-S
the monthly lease rates are awesome, for sure, but i'd much rather just own it after 4 yrs.

but aren't the monthly payments calculated from the price of the vehicle, interest plus all the other taxes and whatnot? so say for example, with $0 down for 48 months purchase financing, a civic si sedan will be $651.65/month. if, for example, the monthly was negotiated to go down to $625/month, wouldn't that mean that they've lowered the MSRP on the vehicle since all the interest, tax, etc is based on the MSRP?

i apologize for my seemingly vast knowledge of this subject and thanks for the replies! :thumbsup:

[nj2Type-S]

king of cars was a sweet show, hehe. :D