Here is the background. I’m in Texas, so leasing is rough: you have to pay taxes on the full sales price unless you can get tax credits. So, BMW has an interesting financing product - the Owner’s Choice balloon loan, that gives low payments for a short period (like a lease) with a balloon payment (the residual) due if one wants to keep the car (but maintaining the option to return). So, this is the best I can approximate my Owner’s Choice loan with the calculator:
**Selling Price: $40,6xx
**Monthly Payment: $347
**Cash Due at Signing: $0
**Residual:0.65 (after mileage deductions)
**Leasehackr Score: 11.5
Given the taxes, the deal is quite good - a hacker score of 11.5 years. Total payments of $8322 over two years. I’d be happy enough with this…
But! The Owner’s Choice is a loan, which means that the car will be titled, for its first time, in my name! Which means that I can claim tax credits of $4001 on my federal return and a rebate of $2500 from the state of Texas, which would bring the total payments to $1821 ($76/mo) and a hacker score of 46.1!