Visited 4 dealers yesterday to browse new cars. Seeking advice as a newbie

This will be my first time I lease a new car or buy a second hand dealers one. Previously I drove as occasional driver in my parents' cars including the Impreza hatchback I had recently.
I did own motorcycles in the past but never applied for a car credit application. Seeking advice on what to prepare before returning to a dealer showroom.

1. I signed up for the APA Toronto and am planning to use their new car buying / referral service that supposedly offers discounts and pre-negotiated rates through brokers / certain dealers.

2. Is signing up for CarCostCanada worth it? Would I have to use the price they release for a certain model and negotiate myself?

3. I've been living in the GTA (Ontario) for 4 months. Credit applications ask for previous address if less than 3 years. I lived in an apt. for 5 years until 2016 in MTL, moved in Aug 2016 and rented rooms since then, moving a lot for school and work. Longest room rental was 8 months, landlord accepted cash only no receipts. Sketchy I know. How can I show stability in my living situation on those applications?. One thing to note is I've been using Canada Post mail redirection service since Aug 2016 and never notified my bank, nor the SAAQ of the move. Only recently in July 2018 did I convert my QC to a ON license. Should I run a credit report via Equifax?

4. How can ask save time if I'm looking to test drive particular models like the Elantra GT, Forte5, VW Golf, Civic HB, Corolla iM or new one and I want them in manual only, plus don't want to waste time with lower ranked salesman who just want to sell me a monthly payment at MSRP? My new work schedule has me doing 12 hour shifts with 2 days off to visit dealers, so limited.

1. Why would you pay a sales broker if you could simply negotiate yourself? People are usually getting brokers because they can't negotiate stuff or they simply don't have the time to shop around. You'll pay some extra for that kind of service and I would simply recommend you spend an extra hour dealing the price and that money will be placed back right into your pocket

2. Yes it is, will show you the markup on the car you are interested into and you're probably going to realize markups are smaller than what people expect. It will also give you a better understanding of why a dealer cannot meet an offer you are giving

3. You can run a credit report but that's not going to make it easier to pass credit for a car..

4. You shop around dealers until you find a car that you are interested in the configuration you are looking for that is ready to test drive. Most of the dealers are not preparing the cars ready to drive until the car is sold, but in some american dealers PDI's (pre-delivery inspection) are done as soon the cars come in and is ready to take the road for a test drive. And as for the salesman trying to sell you the car at MSRP, what is the exact problem about it? Salesmans are trying to sell you the car for the most they can, you want to buy the car for the cheapest you can... what's the difference? A sales rep job is to conclude a deal at a price that is the closest to the MSRP and it is a normal behaviour. If you are looking for some tips, PM me and I will be able to help you on that

Wow thanks for the quick reply! I will review and reply later

I forgot something.
5. My work situation is temporary here in Ontario with possibility of returning to Quebec by spring 2019. I asked a KIA salesperson if I can lease in ON and then if I get another job in QC next year, can I register it and continue to use it in QC? I heard once from an individual on leasebusters that the finance company, in that case VW Credit Canada? I forgot the name, refused to allow cars leased in ON to be transferred to QC without special permission.

Also 6. How to calculate a monthly lease payment and what info to ask the salesperson when he's running the numbers? Years ago I read an American book on leasing that used money factor in the calculations. Can someone show a typical calculation, breaking down the numbers in this example?
Let's say 2018 Golf 5dr Comfortline 5MT @ MSRP, 36 month lease, 1.99% interest rate, $499 admin fee (is admin fee a bogus charge that's just extra dealer profit?). Options: light package $750, driver assistance package: $1750. Tire tax $100, 13% HST.

EuroEnthusiast said:

Also 6. How to calculate a monthly lease payment and what info to ask the salesperson when he's running the numbers? Years ago I read an American book on leasing that used money factor in the calculations. Can someone show a typical calculation, breaking down the numbers in this example?
Let's say 2018 Golf 5dr Comfortline 5MT @ MSRP, 36 month lease, 1.99% interest rate, $499 admin fee (is admin fee a bogus charge that's just extra dealer profit?). Options: light package $750, driver assistance package: $1750. Tire tax $100, 13% HST.

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just go on any manufacturer web site ..the build and cost tool are there

A lease payment is calculated on the current MSRP minus the estimated residual value at the end of your lease term. So, if the car is $20k, and estimated to be worth $12k at the end of a 4 year term, you will be paying the $8k difference and only playing taxes and interest on that amount.

Residual values are non-negotiable and change month to month on most vehicles. Residuals drop during the year, so while all 2018 cars are listed as 2018, a 2018 sold in December is not going to maintain as much value as a 2018 that was sold/leased in January. Interest rates generally drop over the course of the year however, so it kind of compensates for it.

Admin fees are bogus. You can negotiate them and straight up walk if they don't remove them. Dealers are not legally allowed to tack on any fees other than advertised MSRP unless they actually add things to the vehicle such as accessories and/or warranties, which you need to consent to anyways. (in Quebec anyways)

Most of the vehicles you listed are roughly in the 7-8% profit range, car cost usually recommends splitting that in half and asking for that as a discount.

EuroEnthusiast said:

Also 6. How to calculate a monthly lease payment and what info to ask the salesperson when he's running the numbers? Years ago I read an American book on leasing that used money factor in the calculations. Can someone show a typical calculation, breaking down the numbers in this example?
Let's say 2018 Golf 5dr Comfortline 5MT @ MSRP, 36 month lease, 1.99% interest rate, $499 admin fee (is admin fee a bogus charge that's just extra dealer profit?). Options: light package $750, driver assistance package: $1750. Tire tax $100, 13% HST.

Click to expand...

Here is quiclky how to calculate the lease payments:

Price of car (including all options, packages, extended war, 3M film, etc...) + all fees (tires, admin, AC , etc...) - Buy back = XYZ ammount x 13%HST = ammount to finance @ 1.99% on 36 months.

Hope this helps!

srt_mod said:

just go on any manufacturer web site ..the build and cost tool are there

Click to expand...

I know. But I would like to see the complete breakdown and do it with my own calculator.
Example: show me how to calculate the interest rate in a lease payment. Is money factor even used anymore?

When you lease, I don't really see the issue with "shopping for a monthly payment", as long as you compare apples with apples (same term and km allowance).

Still unsure about point #3: what to write for previous address since I've been renting rooms from 8/2016 to now. Bouncing from address to address shows instability. I also had a job with my previous employer that lasted only 2 months in Val d'Or, I was renting a room for cash there and the property has since been sold. Before that I was a student in Quebec City (do I write that as profession?), again renting a room for cash.

EuroEnthusiast said:

Still unsure about point #3: what to write for previous address since I've been renting rooms from 8/2016 to now. Bouncing from address to address shows instability. I also had a job with my previous employer that lasted only 2 months in Val d'Or, I was renting a room for cash there and the property has since been sold. Before that I was a student in Quebec City (do I write that as profession?), again renting a room for cash.

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What was your address on your drivers liscence during that period? on your income taxes repport? Just put that one!

hugo3499 said:

What was your address on your drivers liscence during that period? on your income taxes repport? Just put that one!

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Good point. I guess when I request a credit report from Equifax or TransUnion, I will find out what my address history is with credit bureaus? The address on my QC license was the apt. I lived in from 2011-2016. I never notified the SAAQ of the move to Quebec City since I didn't trust that homeowner with my postal mail (very nosy woman).

JoeyV said:

A lease payment is calculated on the current MSRP minus the estimated residual value at the end of your lease term. So, if the car is $20k, and estimated to be worth $12k at the end of a 4 year term, you will be paying the $8k difference and only playing taxes and interest on that amount.

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Taxes yes, but wrong for the interests... Interests are calculated on the WHOLE care value.

hugo3499 said:

Here is quiclky how to calculate the lease payments:

Price of car (including all options, packages, extended war, 3M film, etc...) + all fees (tires, admin, AC , etc...) - Buy back = XYZ ammount x 13%HST = ammount to finance @ 1.99% on 36 months.

Hope this helps!

Click to expand...

No, no, no... Finance cost is calculated whole car value.

This is how/why you save money by giving multiple deposits.

You might be right, but I don't understand how they could do that? On the financial aspect of things, the lease amount is a financed amount, since you're only financing 8K, how can they charge interest on the total value of the car if that's not the financed amount?

calling @GGTI

EuroEnthusiast said:

Good point. I guess when I request a credit report from Equifax or TransUnion, I will find out what my address history is with credit bureaus? The address on my QC license was the apt. I lived in from 2011-2016. I never notified the SAAQ of the move to Quebec City since I didn't trust that homeowner with my postal mail (very nosy woman).

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There are not the CIA looking for Ben Laden! They are asking for your address to confirm your identity not to see if you move often.

I live and bought a car in Ontario. Watch out for all the bogus fees they add.
Green Tire fee of 499$ for nitrogen filled tires, tell me to shove it up their ass and spin on it.

I negotiated all the fees out btw. It's pretty easy.

g-ng said:

I live and bought a car in Ontario. Watch out for all the bogus fees they add.
Green Tire fee of 499$ for nitrogen filled tires, tell me to shove it up their ass and spin on it.

I negotiated all the fees out btw. It's pretty easy.

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bro u still have the rolla ?


as for buying a car in ontario I have no fkn clue sorry for the highjack

When you've managed to negotiate a fair price for the vehicle price and the salesman tries to get you to sit down with the finance & insurance guy, I guess the finance manager, which protections are worth it on a lease whose term does not exceed the bumper to bumper warranty? Is there some coverage that protects you from end of lease fees for damages?

Also I saw a lease transfer ad and the individual is offering a cash incentive because the wheels have curb rash. If they're not replaced at the end of the lease, is a customer liable for their refinishing or replacement?