Hi everyone, thanks for all the contributions to this forum, I have learned a lot already and am seeing how much better I could have done on previous leases.
I’m in Oregon, where there is a $1k Toyota cash incentive going on. The sales tax on new cars is 0.5% as of the beginning of this year.
Here is a quote I received today from a Toyota dealer for 36/12k:
**Cap Cost Reduction**
Trade Allowance: + 0.00
Payoff: - 0.00
NET Trade: = 0.00
Rebate: + 0.00
Total Customer Paid Cash: + 1,000.00
Inception Fees: - 703.15
Net Cap Cost Reduction: = 296.85
Taxed Cash Down: 296.85
**Cap Cost**
Selling Price: 42,703.00
Discount: - 3,690.00
Add Ons: + 0.00
Back End Adds: + 0.00
Fees: + 652.50
Up Front Fee Tax: + 0.00
Capitalized Taxes: + 25.83
Gross Cap Cost: = 39,691.33
Net Cap Cost Reduction: - 296.85
Net Cap Cost: = 39,394.48
**Residual**
MSRP: + 42,703.00
MSRP Adds: + 0.00
Total MSRP: = 42,703.00
Residual Factor: 0.63
Annual Mileage: 12,000
Base Residual: = 26,902.89
Estimated Mileage: 0
Pre-Charge: 0.10
Mileage Adjustment: - 0.00
Excess Mileage Amount: - 0.00
Residual Adjustment: + 0.00
Adjusted Residual: = 26,902.89
**Monthly Payment**
Lease Depreciation: + 346.99
Lease Charge: + 31.16
Base Lease Payment: = 378.15
Fees: + 0.00
Use Tax: + 0.00
Total Payment: = 378.15
Overall, this seems like a good deal (or at least it matches the lease calculator), and with MSDs I should be able to get it down another ~$26/month, but I have a few questions for the forum:
The “Inception Fees” reduce the 1k incentive to 1/4 of its value. I don’t know what those are – if they include the $650 acquisition fee, then it’s being counted twice: once in the cap cost reduction and once in the cap cost (included in “Fees”). Am I reading that correctly?
Should I ask for a full breakdown of “Inception Fees” and “Fees”?
The standard MSRP and Invoice before add-ons for this model is:
MSRP: $41,930
Invoice: $38,283
This particular vehicle has roughly $1298 (retail) of add-ons.
Yes ask what the fees are, most likely acq and doc fee. Unless you want the retail add ons, say you don’t want them or find a dealer that doesn’t have them. Make sure you figure out gap coverage, Toyota doesn’t include it. I’m confused about the add ons, are these dealer installed or options on the car, the term add ons implies dealer installed.
wow. Didn’t know it was that much of a difference from state to state. Lived in 4 states so far, from south to west coast. I guess I have always lived in higher taxed states.
Oregon doesn’t have sales tax (this is a one-off tax, see below). It has a high state income tax, though. Neighboring Washington has sales tax (6.5%?), but no state income tax. You can probably figure out where Vancouver, WA residents go to Costco.
Prior to this year, I don’t think new car sales were taxed at all. This is a new “Vehicle Privilege Tax” that dealers pay for the privilege of selling cars and also applies to cars purchased out of state by OR residents.
Depends where you live in Washington. If you live in King or the immediate surrounding areas, tax is quite high. Our tax on leases up here in King is 10.3% and if you live in Seattle, it is 10.4%. Not to mention, the 1.3% RTA tax on the full value of the car each year at the time of registration.
I misunderstood the worksheet - the $1k cap cost reduction is not a Toyota promotion (they are saying the cash promotion requires a different/higher money factor), but is in fact a down payment. Here is the fine print on the cash promotion.
So in the original worksheet as shown, it is $1k down, and the inception fees include the first month’s payment. I’ll post an update with the figures adjusted for no downpayment and MSDs.
It’s not a fee it’s just the total due at signing, the dealer can setup the deal however they want. Typical it’s best to roll everything into the cap cost. You are taxed on the fees if you roll them in as opposed to paying them up front, but in your case I would roll everything in(low tax rate). How many dealers have you requested quotes from?
I’m trying to get this one to a place where all the numbers line up and I understand every figure, then I can check around with other dealers if the consensus here is that I can do better on the deal.
