I’ve done all the research on MF/RV and deals others have gotten. Know what rebates I qualify for. Found a ton of potential vehicles on lots. Now - what is my best approach to present an offer to a dealer for a lease? Is it best to just email my offer and tell them my monthly payment, % off MSRP I want and what rebates I qualify for? Do I mention the MF/RV? What has worked best for people. I’ve been sticking out lately so maybe it’s my approach.
From my relatively short time here, my understanding is there are two approaches. If you have done all your homework and know what your target deal is, just tell them your offer is xxx monthly with tax with xxx DAS. Or, provide a very detailed offer, but you have to make sure all the information is accurate and correct, leaving no room for ambiguity. It can’t be anything in the middle- either get right to it or be very detailed.
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FWIW, here is my approach coupled with an example…
Organize all relevant data, tabled below, with the goal of creating a lease proposal that reflects your target deal. The idea is to create your own deal (proposal), not replicate the dealer’s deal.
Rebates are usually treated in one of two ways: (1) Compute how rebates will be allocated. Rebates are often used to cover lease inception fees with any remaining balance used as a CCR, or (2) Use the entire rebate as a CCR.
Next, perform monthly payment calculations like those shown above.
Base Pay = .00161 x (36829.40 + 30531.20) + (36829.40 - 30531.20)/24 = 370.88
Contractual Pay = 1.1075 x 370.88 = 410.75
Now, table all lease inception fees and how they are to be paid. Depending upon how the CCR is calculated (there are several different formulas), will determine the amount due at delivery (signing). Suggest that the CCR be calculated so that DAS = 0 or DAS = 1st payment plus Gov. fees. As a side note, I would not capitalize non-taxable fees such as taxes and gov. fees. In those states that tax the individual payment streams, you’ll pay tax on capped non-taxable fees. As such, it’s suggested that those fees be paid at lease inception, if possible.
Observe that the 14000 rebate exactly covers the CCR as well as the remaining lease inception fees including 1st payment.
Bottom line: Zero drive-off fees followed by 23 monthly payments of 410.75 each.
Commentary
No need to pay large out of pocket cash upfront especially with large rebates. If cash is used as a cap reduction, you could lose most or all of it in the event the vehicle is stolen or totaled. Remember, a car is an expense and a depreciating asset, not an investment. Use the cash to invest in goods and services or other more meaningful and productive investments, particularly if you can earn the equivalent of an after-tax rate of return exceeding 24 x MF.
It’s very foolish and nonproductive to waste hours sitting in a dealership negotiating. This can be a huge distraction. You need time to think and formulate questions within the privacy of your own home. This leads me to suggest…
Craft a lease proposal (example below- the round peg, round hole won’t work) and email it to the sales manager (SM), not a floor salesperson as they’re often Mickey D order takers and lack knowledge. Be sure to contact the SM first to let them know you’re emailing them a one-page lease proposal b/c you want to close the deal today or, at the very latest, tomorrow. Send the proposal as soon as you hang up. It must be comprehensive, authoritative, professional-looking, and flawless. Negotiate via phone/email. Be nice but firm. Explain to them that it is your practice not to deal with multiple dealers simultaneously as it is poor business practice and that you refuse to play foolish games like “can you match or beat this”. Above all, say what you mean and mean what you say. Remember that local dealers know each other. Speak in a commanding and business-like voice that exudes confidence. Unless they’re very stupid, once they see your fabulous proposal it will speak volumes. They’ll immediately know it’s time to put away their toys and board games b/c it’s time to get down to business absent all the BS.
All numbers should be accurate otherwise, you’ll lose credibility. Negotiate via phone/email. Once an agreement is reached, ask the dealer for a review copy of the lease agreement and all contract addenda BEFORE you go to the dealer and sign. Moreover, it’s helpful to know the terms and conditions of the lease contract such as early termination liability criteria and purchase option criteria as well as lease amortization methodology and excess wear/tear criteria. If all is as agreed, tell the SM that you’ll come in to sign asap. You don’t want any surprises or dealer excuses like …. Oh, we made a mistake. That’s unacceptable and shouldn’t be tolerated.
If the dealer isn’t transparent or is uncooperative or showing signs of incompetence, WALK AWAY AND MOVE ON!
Leasing is time-consuming and requires a good deal of study and attention to detail. If you don’t have the time to commit, perhaps your best alternative is a good broker. There are some outstanding brokers on this website. However, if you’re willing to commit your time and resources, be sure to always control the deal. That can only be achieved with education which breeds confidence and increases the likelihood of success.
??? Let me know.
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This is extremely valuable advice thank you! Mind if I try throwing a proposal together and having you give it a quick look? Not to validate the inputs per say or calculations but just on approach?
I’ll be delighted to look at your proposal. BTW, this approach has worked well for me for years.
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What’s the car/trim and what % are you looking for?
Silverado EV Loaners - either 15% off a 2025 LT with no loaner rebate from GM or 10% with. Or a 24 WT for 18% with loaner rebate.
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What does that equate to for an effective monthly payment for both? Link to the calculator?
Do you have this proposal sheet in a shareable format and are willing to share it?
No, I don’t have a template. The reason is that tax treatment varies by state. So, it’s impossible to create a one size fits all. Sorry.
To add to that, people have been asking for templates and formats since this forum began. It’s as if they think it’s a magical solution to the problem. It’s not.
No templates will help unless:
- They pick a hackable vehicle
- Know their target
- Present an actionable offer in any concise way
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Interesting. My proposals conform to what you have described yet, they are useless if used as a template. No template is useful b/c leases can be structured in many different ways. For example, how does one structure a cost minimizing proposal for a traditional monthly pay lease given $15K worth of rebates and $6K trade equity? Certainly, not by using the entire 15K as a CCR and contributing $3K out of pocket cash to cover upfront fees. YIKES! How would one structure a single pay lease given the same criteria?
Providing templates is an open invitation for people to be brain lazy by putting a round peg into a square hole. If scrutinized by a dealer, it could result in serious credibility issues. For example, my posted lease proposals levy tax on the sum of the base payments. A poster irresponsibly used it exactly the way I had structured mine without any thought whatsoever and despite my warnings. He was from a state that taxed the individual payment streams. The dealer told him that his proposal tax calculations were inaccurate. Gee, I wonder why.