Location: Silver Spring, MD
Model: 2016 Highlander Limited with Tech Package
Term: 36 months /12k miles per year
Being offered $4k down, $420 per month
Walk away!!!
What should I offer?
Get the MSRP, the Sale price, the MF and the residual. and post them here. You should put MSD’s down and not and cap reduction. They are having a laugh with that first offer.
MSRP $45,158
Sales Price: $39,860
MF: 0.00124 (2.98%)
Residual Value: 68%
Can you recommend what I should put down and what my monthly payment should be?
With 9 MSD’s and Acquisition paid upfront I make your monthly $278 inc tax at 6%
The MSD’s take it to 0.00052
Drive off $4,152
First month’s payment incl. tax: $278
Down payment: $0
Total MSD payment: $2,700
Registration and doc fee: $480
Tax on cap cost reduction and fees: $44
Acquisition fee: $650
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What does MSD stand for?
Multiple Security Deposits. They are derived from your monthly payment and rounded up to the nearest $25/$50 depending on manufacturer.
Toyota allow 9 of them, with each one reducing your money factor by 0.00007.
At the end of the lease you get all of the money back so they are much better than putting money into a car which you never get back.
Your monthly is $278 which rounds to $300. $300* x 9 = $2,700 which you can see if part of your drive off. You will get that $2,700 back when you habd the car back.
If your Toyota dealer says they have never heard of them make them call the finance dept at Toyota, they all accept them except in NY state.
What would be my monthly payment be with all else constant and the following scenarios:
Scenario 1) No money down for drive off
Scenario 2) $2000 drive off
MD, along with other states like TX and VA, unfortunately levies sales tax on the selling price of the car, rather than just the leased portion. That likely explains the high payment.
You can estimate your lease payment using this calculator: http://leasehackr.com/calculator/
If I do an MSRP of $45,158 and a selling price of $39,860, I get a lower estimate, even accounting for MD taxes. Here’s the program for Highlander Limited, by the way:
2016 Highlander Limited AWD
36/12K: 65% residual, .00124 money factor
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If you want to be successful at negotiating your lease, you need to educate yourself using this forum and read as much as you can to get the “best” deal. For example, instead of asking “what does MSD stand for?”, you could’ve easily searched for this for the definition (the mechanics like rounding to nearest $25/$50, max allowed by what manufacturer, etc.) are harder but you definitely need to know the basics like MSRP, MF, residual %, downpayment vs MSD, taxes in your state, etc. It’s not a lot …
Your first post is very, very, very far away from being a good deal so it is going to be a long slog with this dealer and they may have provided that “offer” to you due to your lack of knowledge. Highlanders are pretty popular on this forum so get familiar with deals that other folks are getting so you can negotiate effectively across the 3 different parts of the lease: depreciation, MF (interest) and sales tax
You will feel awesome once you get the $420/mo (likely without tax) to $278/mo (with tax) that Ed is calculating. With the information on this forum, you should be able to compute the answers to your questions (first post here: http://leasehackr.com/leasing-101) and be within $5-10. The MSDs really help bring the monthly down but if you want to max out at $2k, that is fine too.
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One question I have is where do I put $1250 into the lease calculator for the cash back. I live in Maryland
Toyota is offering a $1250 cash back
I’m not sure which box to put it in the calculator as I live in Maryland
The options in the calculator are:
Taxed Incentives:
Untaxed Incentives:
Post Sale Rebate:
Put 1250 as an untaxed incentive
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I don’t believe the $1250.00 rebate is given on a lease for the Highlander, only a purchase.