Brand new (not loaner or demo) 2023 Jeep Compass latitude Lux 4x4, 80th Special Edition
Black exterior and interior
Base Price: $33695
Optional Equipment: diamond black crystal pearl-coat paint, 29L package, including Sun and Surround Group, Dual Pane Pano Roof, Premium Alpine Speaker System. MSRP with factory installed options: $38365
Vehicle selling price $34534.51 ($4065.49 discount off MSRP)
Trade in allowance on 2021 Jeep Compass latitude $20500 (above Carmax value and above Chrysler payoff, which was $17074.86,equalling to $3425.14 in equity applied as down-payment to a new lease), resulting in $14034.51 taxable price in MD, with MD tax levied in the amount of $842.08 Total Credits: $9008.14
Dealer processing charge: $500
Title and reg fee: $275
Unpaid balance: $27695.14
Acquisition Fee: $695.00 TOTAL DAS/CASH PAID OUT OF POCKET: $333.00 Monthly: $333
P.S. Deal signed in August, before Labor Day holidays.
It’s the amount of equity you applied, which absolutely counts, just because it didn’t physically come out of your pocket, it doesn’t mean it’s not equivalent to a down payment that was due at signing.
I understand, but my traded-in Jeep Compass wasn’t worth what they paid for it, they did it to justify on paper the discount I was getting on the new car. Besides, I didn’t trade in a car I owned, it was Chrysler’s car which I leased for $300 and zero down-payment (I didn’t trade anything to get 2021 deal), so my cost in gaining this equity was literally nothing. I was paying for depreciation and rent charges since January 2021, in all fairness this wasn’t “equity” I could tap into if I sold it to Carmax or Carvana or any other wholesale buyer, since their offers were matching my payoff quote and was nowhere near what dealer paid for it to sell a new car with steep discount.
Skipping the step of taking a check (and obviously depositing it into your bank account) doesn’t change the fact that trade equity is still coming out of your pocket.
No matter how the dealer justified it, they applied $3,425 in trade equity, you can’t just ignore it, or say they overpaid, or whatever, money is money. If the deal wouldn’t be possible without the trade in, then you need to consider that to get a true picture of the pricing.
I won’t argue on this point, I will leave it open to interpretation. I just know my car was not worth in wholesale what they paid for it, because I run my vin numbers and get trade-in appraisals and offers from major wholesale buyers like CarMax, and I run the Edmunds doc com’s own TMV on all cars I trade. They paid close to retail to buy off '21 Compass, I don’t count it as real-world equity. I couldn’t tap on that ‘equity’ if I took my car to CarMax (highest bidder at the time), who was matching payoff quote.
I am not arguing on this specific point, I have opinion and you will not dictate me what my opinions are. It’s outside of your control. I justified my opinion and will leave it to readers to interpret it, should they wish to disagree.
I think my point is that to the economics of your deal, it’s irrelevant, could you have gotten this deal without the trade-in? If no, then you really need to consider that trade value as part of the effective costs, because the deal would literally be impossible without it.
Except it was not a real “money” I could get if I walked around and tried to sell my car at wholesale price. None of the bidders , like Carvana or Carmax, let alone local dealers, would pay above my payoff quote if I was out to just get rid of my car at wholesale price. Applying your logic, I couldn’t sell my Jeep for what I did without getting a new car, so why not count that as the reason why dealer overpaid on something that was worth thousands less than their payment?
Carmax and carvana is not the final authority on used values. Apparently your used car had a value of $20500 and that needs to be reflected in the equation here. Unless you can get this deal without your trade in then it’s applicable.
They are wholesale buyers, they pay what they calculate to be a trade-in value (often above Edmunds dot com TMV), they then spend their money to recondition car and put it for retail sale. No wholesale buyer pays retail on a trade in. Show me one and I will change title of my post.
Except, I don’t think he would do it in his right mind if I drove there to just sell him my Jeep. No one would. They used my Jeep as a back-door to justify on papers discounts given on a new car. This is what happens in a real world. Any accountant can juxtapose the numbers any way they want, but in real world my Jeep was not worth (as a wholesale buy) the amount I have got for it.
