Hello,
My Chevy Bolt lease will expire in a few weeks and I am considering extending it for 1 or 2 additional months while I decide what I want to get next.
I originally got an amazingly good deal on my Bolt $1.6K one-pay for the entire 3 years.
The issue I am facing now is that GM financial is calculating $480+tx per month for the extension, they using a total of $17.3K they see as a “payment” divided by the duration of the lease (36m) to come up with $480+tx per month.
I am guessing that the $17.3K “payment” they are seeing includes the $1.6K I actually paid as well all incentives (~$15.7K) I qualified for at the time of the lease. I told GMF that I actually only paid $1.6K but the rep said that their record shows the $17.3K .
Has anyone experienced a similar issue where the monthly payment is incorrectly calculated for a lease extension on a one-pay?
Any ideas of what can be done to fix it?
Pulled my contract, the amount paid in cash shows the correct amount ($1605) , but GMF is basing their calculation for the lease extension on the “Single scheduled payment” of $17370 that includes credits and rebates.
Effectively GMF is making lease extension unfavorable for one pay leases.
As they should. When your lease was established, the one-pay of 17,370.38 was calculated by first calculating the monthly payment based upon a discounted money factor, an adjusted cap cost, residual, and term. It should include all rebates/credits. The discounted payment is multiplied by the term. Tax is levied on the product to determine your one pay. It’s perfectly logical for GMF to divide the one-pay by the term to determine the extended monthly payment and then, levy tax. That’s how it is done.
But what if your local city or state approves a higher sales tax (like to build a new sports stadium) in the time period between when the one pay was signed and today?
PS, you’re the only LH member that may actually give this any serious thought hehe.
How would it work with a regular lease with monthly payment?
Wouldn’t the extension just be the same as the monthly payment?
If this lease wasn’t a one pay, the monthly payment (with the higher MF) would be ~$60.
Yes, I believe the policy is that you’re able to extend for the same payment for one month, though they don’t accommodate for any additional mileage. I’ll probably do it before turning mine in since I’m so far under mileage given the MY23 swap.
According to your lease contract, the single scheduled payment is 17,370.38. The lease extension is based on this amount and, apparently, excludes rebates/non-cash credits as you have already received them at lease inception. The rebates/credits have been exhausted and are no longer applicable beyond lease end (i.e., you have already received the full benefit of these credits). As such, it’s perfectly logical for GMF to divide the one-pay by the term to determine the extended monthly payment.
What this means is that the adjusted cap cost is less than the residual value. In such an instance, GMF would have never funded the lease. Otherwise, they would be paying you $60 per month. The only way forward is to do a one-pay or, do a monthly lease by adding some options so that the adj. cap exceeds the residual and satisfies GMF’s funding criteria.
Yes, plus tax. So, you’ll pay tax on tax.
It would be the monthly payment plus tax. But here is where you might have a legitimate argument. Suppose you’re doing a monthly lease payment instead of one-pay. Let’s assume a gross cap of 70,000 and rebates/credits of 12,000. This translates to an adj, cap of 58,000. Further assume a residual of 42,000. GMF will fund this 36-month lease for monthly payments of $D. The extended payment would be $D plus tax.
And here is the kicker… the $D payment already includes the rebates/credits and so, you continue to receive that benefit (lower payment because of rebates/credits) beyond lease end if you extend. So, with a monthly lease payment, you continue to receive the benefit of the lower payment if you extend but don’t receive the benefit if you extend a one-pay lease. That would seem to be inconsistent. I believe your GMF lease agreement is silent with regard to lease extensions. You need to call GMF and talk to someone other than the customer service drones as they’re totally clueless. Get to the leasing or legal department.
It looks like the difference is in how the one pay is structured such that the rebates are applied as the payment rather than as an upfront cap cost reduction.
With this one pay, your capitalized cost is much higher, and as such, the total depreciation paid is much higher.
It would likely be a different story with tge lease extension price if the rebates had been applied as cap cost reductions when structuing the initial lease.
That also would have made the one pay itself cheaper due to the lower total rent charge.
just went through this with mine. My one pay was $5200 and i was looking to extended mine and they came back at $580 a month so i said forget it. I was told if you need to extend more then 2 months ur local chevy dealership can call in and request it.
Section 6 of the posted contract shows that the rebate and noncash credits are deducted from the sum of the one-pay, the acq fee, and registration fee leaving the amount owed of 1,605.43. So, the credits are simply deducted from the total amount owed (they come off the top). For a monthly lease, the rebates/credits are deducted from the gross cap and the resulting monthly payment computed with the credits already baked in. In the case of an extension, lessee continues to receive the benefit of the lower payment but does not receive that benefit in the case of a one-pay. That triggers an inconsistency. For the one-pay, the benefit ends at lease end. For the monthly, the benefit continues after lease end.
Every one-pay is paired with a discounted monthly payment not because of the credits. It’s due to the TVM… prepaying the monthly payments using a discounted cost of money (money factor, interest rate). This is analogous to its monthly payment lease cousin. From that apples-to-apples perspective, there is no inconsistency and, I believe that is what GMF is focusing on.
This one pay was structured with the rebates being applied as part of the single payment rather than as a cap cost reduction. If the rebates had been applied as a cap cost reduction, as they are on a monthly, you would not have the extension problem and you would have a greater savings in total rent charge paid.
I have seen one pays written up on ccap leases structured in both ways where an otherwise identical one pay ends up quite a bit lower because it was structured with the rebates as a cap cost reduction rather than part of the single payment. The only difference being the total rent charge as a result of the lower adjusted cap cost when calculating total rent charge at lease inception.
I had already checked with GM multiple times, they always came back with the $480 figure. I tried to point out the double standard in their calculation (for one lease vs regular lease extension) but that didn’t go anywhere.
What is your goal here? Do you expect them to extend your lease for ~$50 a month?
I think it is pretty clear that the huge amount of rebates and incentives have been exhausted during the lease period and that benefit is no longer there.
You know this was an incredible deal and would be a unicorn in these times. Sounds like you want to ride that wave a little longer, but just be happy you got the deal then. Time to look for a new one
