Deal Check - 2024 RAM 1500 BIG HORN 4X4 CREW - $506.61/monthly // 36/10k

Ask the Hackrs Buy/Finance
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1

Long story short, I am getting ready to redeploy and will need a car. Have done hundreds of hours of research on buying a used RAM but now I am about to head home 3-4 weeks and leasing entered my mind. I don’t have as much time before I NEED a vehicle (sold mine before leaving). Can someone help me with the below lease details?

My principle logic: Lease to buy. The lower payment makes it more comfortable in the short term, and the 51% residual makes the lease end buyout remain in comfort zone.

Lease deal is for 36/10K but I imagine I will exceed mileage significantly but again am not worried as the residual will be something I can finance at the end of the term (or maybe slightly before).

Details from a broker I reached out to here: Link

I am stationed in GA and as far as I can tell I will have to pay 7% of fair value up front and then again when I buy it out.

Details (if you prefer not to click the link):
2024 RAM 1500 BIG HORN 4X4 CREW CAB 5’7" BOX

MONTHLY PAYMENT $506.61

TERM: 36

ANNUAL MILEAGE: 10,000

TOTAL MILEAGE 30,000

MATURITY DATE 11/5/2026

AGREED UPON VEHICLE VALUE

MSRP $54,670

DISCOUNT $7,380.45

$47,289.55 GROSS CAPITALIZED COST

VEHICLE SELLING PRICE $47,289.55

$47,289.55 NET CAPITALIZED COST

GROSS CAPITALIZED COST $47,289.55

TAXED INCENTIVES $0

$47,289.55 CAPITALIZED COST REDUCTION

CASH DOWN PAYMENT $0

$0 ADJUSTED CAPITALIZED COST

NET CAPITALIZED COST $47,289.55

CAPITALIZED COST REDUCTION $0

$47,289.55 DEPRECIATION

ADJUSTED CAPITALIZED COST $47,289.55

RESIDUAL (54%)

$29,521.80

$17,767.75 RENT CHANGE

ADJUSTED CAPITALIZED COST $47,289.55

RESIDUAL AMOUNT $29,521.80

MONEY FACTOR 0.00017

LEASE PAYMENTS 36

$470.09 BASE MONTHLY PAYMENT

DEPRECIATION + RENT CHARGE $18,237.84

LEASE PAYMENTS 36

$506.61 MONTHLY PAYMENT

DEPRECIATION $493.55

RENT CHARGE $13.06

$506.61 DUE AT SIGNING

FIRST MONTH $506.61

GOVERNMENT FEES (UNTAXED) $500

ACQUISITION FEE (TAXED) $895

DEALER FEE (TAXED) $899

TAX - TOTAL LEASE PAYMENTS $1,240.17

TAX - ACQUISITION FEE, DEALER FEE$121.99

$4,162.77 TOTAL COST

CASH DOWN PAYMENT $0

DEPRECIATION $17,767.75

RENT CHARGE $470.09

FEES PAID UPFRONT $2,294

TAXES PAID UPFRONT $1,362.16

AFTER SALES FEES $395

$22,289

2

First, thanks for your service. I’m dense and didn’t see the total due at signing. Therefore my previous post doesn’t make sense. I just ended up buying a used silverado, man I wish the days of $3XX/mo truck leases we’re still around.

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3

What do you need in a vehicle?

This generally ends up being a waste of money. New car loan finance charge vs the sum of acq fee + lease rent charge + used car loan finance charge.

It’s even worse if your presumption is correct that you’ll pay tax on fair value twice by leasing then buying

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I need something reliable and a family hauler. We also plan on doing camping so I prefer something 4x4 and with some towing capacity.

Being in the military I am also trying to buy something that is future proof… I.e. if they cut me orders to go back to upstate New York I don’t want to have to be back in this situation trying to trade or buy something else since my needs will have changed.

As for your waste of money comment… I understand buying cars in general is a waste of money… Unfortunately I am in this predictament because they moved us to Korea 3 years ago and so we sold our cars, so when we recently returned we had to buy my wife a car (ended up being a small SUV) that would get our family around and was reliable before they sent me to Poland for the last several months.

If I had a car I would probably just sit on buying until I had better money down or the market stabilized.

I am accepting a bit of a loss money wise to be able to get into something that is an investment (not equity wise) in terms of securing reliable mode of transportation for the foreseeable future within a comfort zone to my budget. Although with the 13.5% discount on MSRP and the near 0 MF on the lease… I am not sure that it really ends up being much loss. Not entirely sure of the fees you mentioned if you could elaborate for a child please.

I am open to any advice in terms of flaws in my logic are.

I am also looking at a used RAM but trying to find out that is in the same budget and that is something I can get under warranty is rare and also may get derailed when the dealer fees etc are stacked on top.

I am in GA. So I will pay fair value on the amount of lease payments when I sign (reflected in the calculator link) and then I guess when I buy it out it will be fair value on the cost of the truck at that point… it wouldn’t be much different then financing it is just split between transactions.

I appreciate your time and dialogue.

5

This doesn’t seem like a horrible deal given the current market. How set are you on the RAM? Have you checked with @Jrouleau426 on how much the equivalent tundra would run?

If you lease with TFS you will have the added benefit of being able to transfer the lease. This RAM will likely be underwater for the entire duration of the lease and it can’t be transferred, so gives you no flexibility to get out of it.

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6

Yes I actually chatted with him. Good dude. Unfortunately, for what he has on ground I cannot afford it. I think Toyotas in general have really good demand so whereas the Ram becomes affordable because they are knocking 13% off MSRP I think in Toyotas world, getting to at MSRP is a win due to high demand.

I appreciate the advice.

7

Would an AWD SUV work? Last time I checked there were big discounts on reliable vehicles that hold their value over time, such as Honda Passports for example.

Or if you want to actually wait, then there’s a thread on the forum titled “What can I buy for $10k” or less.

I think $18,000+ (the total cost of the quoted RAM lease) + the cost of gas is too much to pay for waiting. And personally I think CJDR products are not reliable enough to buy.

8

I don’t want another SUV. We already have an SUV and based on the things I have needed from my vehicle (and not had) in recent history, having a truck would have almost always solved the problem.

You lost me on the ‘What can I buy for 10K” thread. I am not seeing that anywhere and I also don’t understand the ‘waiting’ reference.

To elaborate on why I chose Ram…. I have spent the last month researching used trucks and from hundreds of hours of getting into the weeds this is where I stand…in the absence of being able to control for good maintenance (buying used)…

-GMs have issues due to DFM/AFM which will require the engine to be replaced. There is class action lawsuit pending.

-Fords have settled class action lawsuits on their 10 speed which comes in every new(er) f150. Their DOHC engines are also complex and prone to serious failure.

-Ram 5.7 hemi has a mechanical flaw that CAN potentially cause lifter failure and the HEMI tick… the ‘tick’ also may just be exhaust manifolds which is far more likely but far less serious.

-Toyotas…got it. They have reputation (albeit inflated for the trucks that have brand new power train) for being ridiculously reliable and this causes insane used car prices….

BLUF of all that is that every manufacturer has their problems as they relate to major powertrain issues. These conditions increase in likelihood with decrease in maintenance and increase of usage.

This led me (originally looking at used) to examine warranty programs. What I found in warranty programs is that if I can find a RAM in the certified or still in its powertrain warranty, I can extend the warranty through MOPAR and will actually be covered if those lifters failed and ultimately, while there is a mechanical flaw, there are conditions (minimal idling, replacing oil pump with high volume variant) that can be controlled for to decrease probability of failure. The warranty covering what I wouldn’t be able to control for (previous maintenance)

Ultimately, I just want to buy something that isn’t going to be a sunk ship… I don’t expect any vehicle to be maintenance free but as long as the powertrain survives I can live with the other maintenance. In terms of that aspect RAM seems like the best bet.

9

Look for a 2023. They’ve got deeper discounts right now and $4500 in lease cash for Big Horn trims.

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10

I’m around 10-12% off tundras. But you’ll likely have equity at lease end making them the same price or cheaper. Of course that’s not a guarantee but if used values stay similar to what 2022 tundras are selling for then you’ll have a few thousand in equity.

11

I thought I reached out on your thread… I will double check and send you a message in accordance with whatever your thread prefers.

Edit: I read your thread. Thought about reaching out but never got around to texting you. I will shoot you a text sometime in the coming days once I digest what you have posted so far.

Edit #2: Sent you a text. -Joe

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Yeah the discount they gave me on a 2024 was like 13% so the RAM is definitely seeming like the best bet. I did however stumble onto another thread about CDJR and ALLY leasing and its kind of turning me off to commit to the terms and then potentially the lease contract stipulations (buy out details, ‘smart lease’ etc) blow up the deal and I just waited two months and still don’t have a vehicle.

13

I might’ve missed that. Was this an Ally lease quoted above or CDJR?

14

Thank you for your service and sacrifices. Have you checked the incentives on this? I didn’t see a breakdown but some companies in the past have doubled down on veteran discounts during this month for Veteran’s day.

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15

I am not sure. I haven’t gotten that far into the lease as I was just feeling out the numbers and trying to decide.

16

Would a Tacoma work for you?

17

I have not checked that. I also don’t fully understand the incentives. I was assuming that using a broke they were going to try to get the best possible incentivized deal since that makes the likelihood of closing the deal go up but I also see a bunch of incentives on the calculator that are all super specific and weird. Still trying to understand all that.

18

At first I was almost exclusively considering mid-sized trucks. I just think one of the big things that we end up doing a lot in the military is driving across country due to a move or to see relatives and it would be very very nice to have a crew cab on a full size where the kids have buffer space and can’t kick our seats. I have already driven the entire perimeter of the US in a Acadia and then again a Durango, I think the short time I rented a Ram crew cab was the most comfortable we have been in a vehicle.

If I get a smaller truck I was looking at a maverick or something I could just finance new… but I don’t want to buy something that just ends up not solving the main problems that had me looking at a full size.

I appreciate your back and forth with me on this.

19

Thank you for your service. Since you are a super supporter you should definitely take some time and play around with the different incentives. If I use a Ft Benning zip there is a potential total of $7500 in incentives on a 2023 Big Horn 4x4 5’7" box if you can find one that you like. Also a very low MF using CCAP (not SFS) so you are paying mostly depreciation if your goal is to buy it out at the end. 5k of standard incentives and then $1000 Ram website TDM, $500 military, and $1000 loyalty if you still have that Durango(?) for $7500 total. I recently picked up a 2023 Laramie trim and very happy with it so far.

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20

Yeah so I was playing around with the calculator but I don’t understand what deals apply and what don’t. The broker giving me 13% off MSRP was a massive deal (it seemed), but I will go back and mess with the calculator. I have never leased before let alone thought about leasing so bit out of my depth here. No I don’t have the Durango. We sold both our vehicles before we went to Korea so yeah.