I made an agreement with a dealer here in Florida on a lease. I’m going to be paying inceptions up front. They were going to be around $3,000. I received a text from the GM with the copy of the agreed sales price, etc - see attached.
It seems like he put the inceptions into the lease payment, then an additional $3,000 down. Am I missing something?
Thanks!
Nick
This makes very little difference.
In the future, just specify how much you want to pay due at signing. Yah, in some states it can make a slight difference in tax applications on some of the upfronts, but we’re usually talking about a few dollars difference.
I said $3,000 … but we specifically said it was only for inceptions - nothing into equity of the vehicle. But it seems like, if you add all these extra fees up, it’s roughly $3k.
Should these not be taken out of the payment that’s calculated?
If the fees are capitalized and then you pay a capital cost reduction, you’re essentially just paying for the fees. If they’re charging you upfront for the fees AND a cost cost reduction, that’s a different story, but in this case, it’s just a book keeping thing.
Let’s look at a simplified example. Let’s say you’ve got a $10k vehicle and $2k in fees. You agree to pay $2k in fees up front.
In your situation, the lease cost is $10k and you pay the $2k in fees upfront. You are left paying $10k over 36 months, so you have a payment of $278.
In this situation, they capitalized the fees into the vehicle value, so the lease cost is $12k, then the $2k is applied to reduce the lease cost. You are left paying $10k over 36 months, so you have a payment of $278.
In both situations, you pay $278/mo with $2000 due at signing. How they book kept things on the contract makes no difference.
Yes exactly … I see your point. But I specially said to the GM “paying inception fees up front” and he happen to say it’ll be around “$3k” I said that’s perfect, I’ll pay that up front. But when he brought the paper over it had “$3,000 down” I said obviously it’s not EXACTLY $3,000 so what if it’s a little less, or a little more? He said you’re putting down $3,000 - doesn’t matter if they are a little higher or lower. So here I am thinking, when I left, that the monthly payment would not also include any of the inception fees - which looks like $3k according to this paper.
Unless I’m really not understanding, it seems that the payment includes $3,000 of stuff I was supposed to just pay up front for. But now it seems like I’m putting $3k down AND I have taxes and fees rolled into the lease payment.
? Shrug lol thanks
This isn’t really anything different though. There are some states where some fees paid upfront aren’t taxed and when they’re rolled in they are, but that’s literally the only potential difference in net cost.
IMO, the biggest issue in your negotiation strategy here isn’t the capitalized vs upfront on the fees, it’s that you made an ambiguous offer. Don’t do that. Always specify a specific number. If you want to pay $3000, say $3000. The moment you say an ambiguous amount, it opens up the door for them to have it fall in their favor.
Bud who cares?
You are coming up with 3k your payment is what you want. Do you REALLY care if its CCR/taxes or the puppy fee?
Total out of pocket and monthly are all that matter
Yea I was just trying to understand really … when I look at the paper I just see taxes and fees that look like it’s rolled into the lease payment, so I thought the payment should be based off of a $3,000 less cap cost.
But I understand now with the example above. Basically bookkeeping. No difference. I see that now.
Thank you.
I guess if it makes you feel better tell the GM exactly what you said here. I will pay inception fees at delivery and be specific to him/her as to what “inception fees” are and how you want them applied. Most consumers are not savvy enough with leasing to know the difference between Due at signing and Downpayment.
Also, you can put their deal sheet into the calculator and see how all the numbers work.
