So here is what i’ve been quoted.
MSRP $57175
Sale Price $48888
Residual Amount $34030
MF 0.00177
Breakdown of $3888
- $380 1st month payment
- Cap Cost reduction $7167
- Upfront sales tax $776
- DMV transfer $53
- Doc Prep Fee $85
- BMW Acquisition Fee $925
- Less -$5500 total rebate
Total due $3888
What is the upfront sales tax based on? I thought in California you’re only paying for tax on what you finance/lease?
I would rather have the rebates cover the misc fees and the excess from the rebates go towards the cap cost reduction (down payment). I still don’t know how that would effect the upfront sales cost. I’m not sure why I’d be paying for this at signing.
I also tried to do the math on the collector but it does’t look like the math is working out correctly…, there isn’t a place to account for upfront sales tax and when I put the incentives in along with the cap cost reduction, the math is clearly way off on my end. Any assistance with this is appreciated! Thank you in advance!
Up front tax is on cap cost reduction, taxable rebates, and non-DMV fees
Upfront tax on incentives/rebates.
Example the Toyota Mirai has 6k Rebate and you pay 7.75% tax
Upfront tax equals…
9.5% x ( 7167 cap reduction + 925 acq fee + 80 dealer fee) = 776.34
Apparently, you’re paying all the fees upfront (e.g., cash cap reduction (1667)?, acq fee, dealer fee, dmv fee, sales tax (776.34), 1st payment). The calculator shows a dealer fee of 80 yet, you list shows 85. Which is it?
You’re right, in CA the base monthly payment steams are taxed. The $380 payment includes tax…
base payment = .00177 x (41721 + 34030) + (41721 - 34030) / 36 = 347.72
lease payment = 347.72 x 1.095 = 380.75
Do not make a cash cap reduction… among other considerations, a car is a depreciating asset and, therefore, an expense, not an investment. Do apply the rebate to your upfront fees if possible. Don’t let the dealer control the deal!
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One other thing; why do you show a residual of 34030 and not 34876.75 (61% x 57175)? Also, you may want to do all the calculations manually instead of relying on a calculator.
That’s a good question, maybe it’s because the car has about 3k miles on it, but I don’t see why the residual is marked lower because of that. I’ll have to follow up on this. And the dealer fee is $85 (although I though California capped dealer doc fees at $80).
In regards to the cap cost reduction, with the extra amount from the rebates after it covers the fees would it make more sense to apply the balance as MSDs (if that’s possible) or use that towards the selling price of the car, essentially dropping the selling price as intended?
3000 miles? I didn’t know that because you never said anything about that… yes, that is likely reason for the slightly lower residual. Let’s see…
34876.75 - (miles - 500) x .25 = 34030
miles = 3887
Are you sure it’s only 3k miles? My calculations show 3887 miles.
Selling price is selling price. Cap reductions don’t drop the selling price whether they’re rebates, incentives, or otherwise. I would try to use the rebates to offset some of those or all of those upfront fees, including MSD’s. Don’t make any cash cap reductions.
Got it, thank you for the help! Yes the current mileage listed for the car is 3,885, it may be 3,887 if people have test driven it.
I’m waiting for the new quote based on a $0 down basis and I’ll see what the monthly would look like if the excess amount were used for MSDs versus cap cost reduction.
Is this a loaner or demo? 15% off of a loaner isn’t that impressive.
It is a service loaner car. I’m told based on a $0 down/out of pocket basis, my monthly would be $500.
I want to try and figure out how to calculate this on my own, by hand, on a $0 basis with two different scenarios.
-
$0 down/out of pocket with the rebates covering fees and the excess amount going to cap cost reduction.
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$0 down/out of pocket with the rebates covering fees and the excess being used as MSDs.
Any formulas for this specifically? I see all the formulas for calculating your monthly, RV and so on, but nothing these two type of scenarios.
I rolled everything in the lease, acq fees, doc fees etc. Also, get the car for 24 months. It’s only a diff of couple bucks.
You can probably push for 18% discount.
Does this account for the rebates covering the drive off and MSDs? If so, then what about the extra $1,381 left over from the rebates (5500 - 3150 - 969 = 1381)?
Also, why do 2 years vs. 3 years? Looks like the monthly would be less for the 3 year term.
I appreciate all the help, clearly I’m new to this and making it more difficult that it has to be. 
The residual on the car is 59.51% after the mileage penalty. Change that in your calculator. The numbers for 24mo and 36mo are fairly close. Generally people like to go for 24mo lease if the payments are fairly close because there will be less maintenance costs (brakes, tire etc) that you will have to put your money into.
You have $5500 in rebates ? What all rebates are you adding in ?
The calculator will adjust the MF for MSDs, you don’t have to do anything special other than that.
Where are you getting these numbers ($3150, $969) from ?
Also you can ask the dealer for the lease worksheet. It will be much easier to understand the deal that way.
$4500 lease credit and $1000 college grad credit
$3150 being the 7 MSDs and $969 being the drive off fees.
Yeah I should ask for that, that way I can do the calculations and not have to ask for all the various ways to run the numbers.
Leave $3150 out of the calculations. That is just to bring down the MF.
Things to consider are Rebates ($5500), upfront fees (Acq + other - $969) - I would advise you to roll in the upfront fees.
The calc shows upfront fees
