Im currently looking at my closed end motor vehicle lease agreement for my Toyota Corolla LE and i noticed in box 7 (amount due at lease signing or delivery) includes a Document fee of $395
then in box 13 (itemized of gross cap cost) im also paying acquisition fees of $650
my question is: can any of these be avoidable for my next lease?
They also added a $500 cap cost reduction when I strictly said i didnt want to put no money down and instead negotiate over the cap cost of the car we agreed was okay on. do they often do this?
Doc fees and acquisition fees are part of the process.
No money down and no money due at sale are two different things. If you said no money down, they likely structured the deal with no cap cost reduction (down payment), but with money due at sale to cover some of the fees.
If you said no money due at sale and they didnât listen, you should have moved on.
Echoing Max. In many cases, the dealer may structure a deal on paper in a way that gets it approved by Toyota Financial that may not reflect the actual reality of your out of pocket costs.
Also as others have said, typically âdownâ refers to upfront payment/deposit while âdueâ generally refers to money due at signing to cover fees. You can always roll those into your total loan and make your deal a true sign and drive but you have to specify that.
Pretty much every lease Iâve had looks on paper absolutely nothing like what the actual deal is. Iâve never not had a dealer show on the contract that there was cash exchanged at signing when in reality there was none. They always get very creativeđ
Hi just signed lease papers for a 2020 Hyundai Ioniq electric in MA.
We got $105.89/month with the 6.25% sales tax on top of the $99/month deal Hyundai has. $1500 down payment which is essentially $989 + title + reg + doc fees.
But the dealer looks like they added $1200 appearance package.
So the capitalized cost has gone up from $31,817.67 to $33667.67 with the $1200 appearance package and $650 acquisition fee.
But the depreciation is kept at $2205.16 and then Rent charge of $1382.60 to keep total of base monthly payments to $3587.76.
Residual value is $16679.60 and adjusted capitalized cost is $18884.76
Capitalized cost reduction is $14782.91
So my question since my monthly payments are the same, do I need to worry about the add ons if I never intend to buy The vehicle at the end of the lease.
The manager probably makes more commission by selling those products, even if it means reducing the sales price further to keep the payment and DAS the same.
Thanks max_g. Was not sure if your response was to my query or to PartyHatâs original question.
If it was to my query, I donât have to worry about it because my monthly payments and first payment are fixed? And this is the way dealership makes more money by honoring the national advertised deal but by moving around items? Thanks in advance. Somehow I had a nagging suspicion that I might be hit by these down the road.
Look, thereâs a ton of levers, pull one (add ons), and pull another (bigger discount to compensate), and you get an identical payment, everyone wins.
They make more commission from the add on, and you get a good (hopefully great) deal.
Plus you already signed, unless MA has a cool off period or something similar, itâs yours so enjoy!
Thanks HersheySweet. Yeah have not taken delivery of the car and Am hoping to make sure I do the right thing. If my payments are fixed and I am not impacted by this add on, then I will keep th contract and take possession of the car.
I definitely paid for it as you said. My nagging worry is how did I pay for it as my monthly payments are capped and my initial payment is capped.
My best guess is I paid for it by the increased residual value as the sale price got bumped up. So if I decide to keep the car after 3 years I will pay that extra. But if I return it I wonât be hit. Is that a good way to understand it.
In my Gross Capitalized cost it says $31,817.67 (Agreed upon price of the vehicle). They added $1200 appearance package and $650 Acquisition fee to make it $33,667.67
The residual value is $16679.60
So it is 52.42% of the $31,817.67 or 49.5% of the $33,667.67
On Edmunds they say 49% residual. Hence I am assuming the residual got bumped up. If I donât buy at the end it is immaterial to me but still have the nagging feeling that someone is paying for this and might be Hyundai getting stuck with a vehicle with higher residual than they can resell for. But somewhere else I read that residuals cannot be set by dealers and is fixed by Hyundai finance. So not sure.
Yes it says $31,817.67 is the agreed upon price. Actual MSRP on the car is $33,045 + Destination which is $34040. Using that the residual comes to 49.3%.
Either way if the dealer can squeeze in this appearance package it will be hurting Hyundai if I turn it in. Not sure if they let them get away with that. Hence thinking how this got added in. Alternate explanation is Hyundai had additional incentives to the dealer beyond the $99/month 36 months, $989 down before taxes/fees that they advertised and which is what we asked for.
The paperwork also has $14000 in Rebates and Non Cash Credits. That could be another thing they played around with as well. Give more incentives which they probably share with Hyundai whereas the appearance package is pure profit.
Very happy with the deal. Just trying to eliminate any unknowns as I have never paid for the dealer add ons as I always buy our cars and this is the first lease.
Is the appearance pack on the window sticker? If itâs on the window sticker, it should be residualized and would increase the RV. If it was a dealer add on, it shouldnât be on the window sticker and would not included in the RV. What was the appearance package?
