Hi - looking for some assistance on negotiating a lease deal and what wiggle room do I have in my search to lease a 2025 Mache
Lease offer provided below
Need help to know if the price is good, incentives, an the MF and what is a realistic negotiation for this
FMC does not use an MF. Your lease rate is 1.75%. It would help to know the sales tax rate.
Hey, thank you for inputs that is helpful, I did not know that!
Also for Tax rate, is this really a negotiable number, or you are saying just for transparency to know what % I am being taxed?
There is a lot of information missing such as adjustable cap cost, cap reduction, capitalized amounts, amount due at signing. Sales tax rate is non-negotiable and is established by your AZ tax jurisdiction. What I find troublesome is the residual factor is only 47% which is non-negotiable for a given lease term and annual mileage requirement. Also, the dealer discount off MSRP is a awful IMO … just 5%. I would check LH signed deals and the LH marketplace to see what others are paying in your regional market.
FWIW-
Don’t waste time trying to decipher a dealer’s worksheet. Otherwise, you’re allowing them to control the deal. They often omit a lot of relevant detail such as the money factor; not itemizing fees and occasionally will make mistakes. Rely on credible outside sources (e.g., LH marketplace and signed deals, Edmunds, etc.).
The only useful thing about dealer lease worksheets is the input data. All data must be vetted such as acquisition fee, doc fee (regulated by some states), cost of money (e.g., money factor), gov fees, residual, rebates/incentives, sales tax rate, etc. Make sure the residual matches the term and annual mileage requirement. Check available tax credits/incentives via the dealer or fund provider who may issue tax credits or, at minimum, may assess a lower sales tax rate to energize sales for some models (e.g., Texas).
Do a deep dive and research a reasonable selling price in your market. Sometimes, dealers embed rebates in their discount. Keep them separate but recognize that transparency may become an issue. Secure a copy of the factory window sticker. Check for non-factory add-ons or dealer-installed options. If possible, eliminate those you don’t need or want. Get a list of customer rebates, incentives, and credits (e.g., electric chargers) including VIN-specific discounts, if any. The dealer has such a list. GM calls this list the Customer Incentive Acknowledgement form which includes mandatory rebate and incentive disclosures. Restrictions may apply to the extent that some rebates may not be required disclosures such as college grad, military, educators, AMEX, Costco, etc.
Organize all researched and vetted data, fictitious example tabled below, with the goal of creating a lease proposal that reflects your target deal. The idea is to create your own deal, not replicate or reverse engineer the dealer’s deal.
Rebates are usually treated in one of two ways: (1) Allocate a portion of the rebates 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 shown below.
Base Pay = .00161 x (36688.30 + 30531.20) + (36688.30 - 30531.20)/24 = 364.77
Contractual Pay = 1.1075 x 370.88 = 403.98
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. I calculated the CCR so that DAS = 0. As a side note, I would not capitalize non-taxable fees such as taxes and gov. fees. In those states that tax the payments, you’ll pay tax on capped non-taxable fees. As such, it’s suggested that non-taxable fees be paid at lease inception whenever possible.
Observe that the 14000 rebate exactly covers the CCR as well as all lease inception fees including 1st payment.
Bottom line: Zero drive-off followed by 23 monthly payments of 403.98 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 a depreciating asset and an expense, 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 or, 24 x .00161 = 3.864%.
It’s very foolish and nonproductive to waste hours sitting in a dealership negotiating. You’ll get dizzy watching some salesperson running back and forth. 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 otherwise, you’ll lose credibility.
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 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 as it’s time to get down to business absent all the BS.
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 excess wear/tear criteria. If all terms are 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 or interest 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.
Hi - I posted on here a bit back looking for help on a lease deal, I’ve since learned much more now
I have been proposed this lease deal - I need help to know if the base deal is good enough to move forward with adding in my trade in and also factoring negative equity
For a 2025 Mache E Select — I am looking to get into the cheapest 2025 Mach E lease with the lowest MSRP
I have currently been able to negotiate post this write up to a monthly of around 450 — awaiting on that write up to be sent but most like knocking down the sell price another 1500 closer to base MSRP
I have a few questions I need help answering before I make a decision
My thought process is that we roll some of the negative equity into the lease and then in 3 years she can start over and finance if she chooses or continue to
Where I need help deciding is — if we get the monthly to 450 then roll in at the max 5K (with the premise that $1000 is $30 on a lease monthly) that would be a note of ~600
Is that understanding correct? If so then I can the choose to pay down the negative equity and get lower and/or still negotiate a higher trade in with the dealer
Thanks in advance for any help as these are some questions I face and just need to talk it out with people who have lease exp
Seems high for a Mach E select, especially if I’m reading that correctly that you’re putting $6k down?
I think the Ioniq 5 is a better lease right now. Or if you’re trying to go more of the saving money route a blazer or equinox EV would suffice.
If you’re dead set on a Mach E I have a GT I’m trying to transfer
Edit: scratch that, I just cant read. You’re putting $500 DAS.
I’d still say this is too high though. And there is no rule of thumb for how much negative equity translates to a monthly payment. That depends on the money factor (or rate in your case with Ford) and the lease duration.
I thought everyone was getting employee pricing. You’re barely getting 5% off in this deal.
Yes I originally thought I was putting 6K down but it’s only 1st month DAS
I will look into both the Ioniq and the Equinox as I did not consider them as options thanks
Would you expect less than base MSRP for this “employee pricing”
I think A-plan is 4.5% off dealer invoice.
Either way, with cars sitting at lots, you should push for a higher discount.
