Look at Actual Lease Deal

Car manufacturers promote new lease deals every month. They look like great deals. Are these deals good or bad?

Let's take a look at an actual "special" lease offer for a very popular vehicle on the Honda USA website.

It's for a 2026 Honda Accord 1.5T LX model, as a "Featured Lease".

The fine print for this advertised deal reveals a number of restrictions. It also provides enough details that allow us to evaluate the deal and determine if it is good or bad. Let's get started.

Restrictions

• Only available in 22 out of 50 states

• Only 10,000 miles per year allowed

• The deal expires in roughly a month

• Only available for "well qualified" customers (i.e., those with the best credit histories and scores)

Provided Figures

• Payment - $299/month (sales tax, if any, not included)

• Amount due at signing - $3999 (includes first month's payment)

• Term - 36 months

• MSRP - $26,590

• Net capitalized cost - $25,403.66 (discounted price that also includes dealer fee and lease acquisition fee)

• Total of payments - $10,764 (simply monthly payment $299 multiplied by 36 months)

• Lease-end purchase price option - $18,049.90 (Residual Value - 68% of MSRP)

• Over mileage fee - $0.20 per mile over 10,000 miles

Analysis

Other than the restrictions shown above, here are some observations about this deal. They have given us a large residual value of 68%, which is reasonable for this popular car. However, most of the other factors are not so great.

They have teased us with a low monthly payment of $299/mo but hit us with a high down payment of $3,700 (due at signing minus the first month's payment), which makes the effective monthly payment a whopping $607.33 (down payment divided by 12 plus stated monthly payment). Furthermore, they haven't given us much of a price discount — less than $1000.

Now when we enter the figues from this deal into our Lease Deal Calculator, it rates as only a 1 out of 5 — a very poor deal. Using the 1% Rule, we get a result of 2.28% — a long way from 1%.

This poor deal is caused by the high Effective Monthly Payment, and very likely, a highly interest rate (they don't show that for this deal). What appears to be a great deal with a low monthly payment is not a good deal at all. In fact, it might be possible to forget this deal and negotiate a better deal for yourself.

As a side note, we have noticed that since the COVID pandemic, most "special" lease offers from manufacturers (through dealers) are not very special, unlike the old days when the deals were nearly always better than you might negotiate yourself.