Incentive to lease new Telluride

[flude7]

I intend to pay cash for a new Telluride purchase, however, local dealership says I can get $2700 off MSRP on an EX in stock by doing a “lease-to-purchase” and then paying it off a month later with no penalties. All I’d have to pay at pickup is the first month’s lease payment. Anybody ever heard of that offer? Any small print that has not been told to me?

 

[jw_tx21]

I intend to pay cash for a new Telluride purchase, however, local dealership says I can get $2700 off MSRP on an EX in stock by doing a “lease-to-purchase” and then paying it off a month later with no penalties. All I’d have to pay at pickup is the first month’s lease payment. Anybody ever heard of that offer? Any small print that has not been told to me?

You could try that - but read the fine print carefully. The lease cash is intended to be an initial incentive to lease with KMF, but their money factors are so high, the interest charge will be approximately $5000 over the course of a 3-year lease. A lease to purchase would mean that you start the lease, but then have the opportunity to buy it out (payoff early) for the car's value. Regulation can vary state by state... and it depends on the fine print in the lease contract - because some lease contracts require you to payoff the full value of the lease up front and then buy the car at the residual - in which case you wouldn't save any money because the money factor is so darn high - and you'd have to pay the rent charge too!!

You could also try a one-pay lease - i.e. ask to pay (MSRP-2700-residual value) - aka depreciation - up front - you may have to add some for interest expense - and then buy the car at its residual value in 3 years.

But be careful - because Kia charges an acquisition fee on leases ($650 and a disposition fee of $300 to buy) - so out of your $2700 "savings" you're really only getting about $1700 because the rest will be eroded in fees. There could also be a buyout fee - so just read everything.

You could take the KMF finance offer rebate currently $1000 and then pay off in a month to at least get the $1000. Just be careful taking the lease cash with intent to purchase... leases can be less flexible than standard finance contracts.