is this lease quote reasonable?

timjoe

i’m slugging it out with my local dealer on a 36/12 lease for a 2019 honda accord sport … the latest offer from the dealer is:
*msrp------$ 27100
*sell------- $ 23529 (13.2% discount)
*pmt/mo----$ 295 inc. tax x 36 = $10620
*das--------$ 0
...does this appear to be a reasonable deal or not?...i need a sense from you folks at the forum because i'm new to leasing and i need help.

timjoe

no opinions? do i need to provide more information about the offer?

lowmoneyfactor

timjoe said:

i’m slugging it out with my local dealer on a 36/12 lease for a 2019 honda accord sport … the latest offer from the dealer is:
*pmt/mo----$ 295 inc. tax

Payment w/o tax =???

Sign 'N Drive with only 35 payments?

timjoe said:

do i need to provide more information about the offer?

Yes.

Helpful to post a scan of the dealertrack/AHFC worksheet they gave you...

timjoe

payment w/0 tax = 278 ... first payment at signing, then 35 thereafter...they've not provided me with a worksheet...i'll ask again.

Michaell

timjoe said:

payment w/0 tax = 278 ... first payment at signing, then 35 thereafter...they've not provided me with a worksheet...i'll ask again.

The more details you provide, the more we can help.

timjoe

finally!…dealer sent me the honda finance worksheet for my accord sport potential deal…my initial thoughts/questions:
1. can i insist they take the splash guards off the deal? options like this don't add to residual value, not to mention they increase the price of the deal.
2. sales/use tax $663 … it appears to be 2.8% of the "agreed upon value" of the car --- but what is this tax? it appears on both sides of the worksheet.
3. gross cap cost… should all five of these figures be included to get the gross cap cost of $25,242?
4.rent charge calculation…is this figured accurately?
5. current odometer reading shows as 20 on the worksheet…i doubt that's accurate…shouldn't i insist it be accurate?
6. it's not shown on the worksheet but the monthly pretax works out to $277.54, based on where i live.
*******
so, does anything stand out on the worksheet as suspect, incomplete, sneaky, whatever? also, if the deal looks ethical, does it also look like a reasonable deal?
….any and all questions and comments greatly appreciated!
tim

Michaell

timjoe said:

finally!…dealer sent me the honda finance worksheet for my accord sport potential deal…my initial thoughts/questions:
1. can i insist they take the splash guards off the deal? options like this don't add to residual value, not to mention they increase the price of the deal.
2. sales/use tax $663 … it appears to be 2.8% of the "agreed upon value" of the car --- but what is this tax? it appears on both sides of the worksheet.
3. gross cap cost… should all five of these figures be included to get the gross cap cost of $25,242?
4.rent charge calculation…is this figured accurately?
5. current odometer reading shows as 20 on the worksheet…i doubt that's accurate…shouldn't i insist it be accurate?
6. it's not shown on the worksheet but the monthly pretax works out to $277.54, based on where i live.
*******
so, does anything stand out on the worksheet as suspect, incomplete, sneaky, whatever? also, if the deal looks ethical, does it also look like a reasonable deal?
….any and all questions and comments greatly appreciated!
tim

Can't tell you if it's reasonable, but I'm just a penny or two off that payment calculation.

To answer your questions:

1. You can ask, but doubt it will happen; you can try to shave off $150 from the sales price to compensate
2. It is the sales tax - what state is this for?
3. Yes; I'll guess you live in a state where the tax is assessed against the sum of the payments, then added in
4. Yes
5. You'll probably sign an odometer worksheet attesting to the correct reading.
6. I don't think there is a "pre tax" payment, as the tax is part of the cap cost

timjoe

on sales tax i am in illinois...so it's 6.25%

Michaell

timjoe said:

on sales tax i am in illinois...so it's 6.25%

OK, IL taxes the sum of the payments and collects that money up front.

I don't see anything wrong with the quote.

timjoe

but my monthly payment includes the state sales tax...am i then paying the tax twice?

Michaell

timjoe said:

but my monthly payment includes the state sales tax...am i then paying the tax twice?

No

timjoe

they provided a worksheet but should they also provide a "federal consumer lending act disclosures" sheet?

Michaell

timjoe said:

they provided a worksheet but should they also provide a "federal consumer lending act disclosures" sheet?

That's for a purchase transaction only.

timjoe

my mistake...i meant to write "federal consumer leasing act disclosures"...here's an example i found:

Michaell

timjoe said:

my mistake...i meant to write "federal consumer leasing act disclosures"...here's an example i found:

Please note that the money factor is not to be found anywhere on that worksheet.

timjoe

you're right...how is that possible when this clearly is about a leased car?

Michaell

timjoe said:

you're right...how is that possible when this clearly is about a leased car?

Because the federal statutes don't require it. The auto dealer lobby is pretty powerful, if you hadn't noticed.

timjoe

it's odd that the feds don't require disclosure of the money factor but, nevertheless, is this disclosure sheet something the dealer must provide to me since it will be a lease and not a sale?

Michaell

timjoe said:

it's odd that the feds don't require disclosure of the money factor but, nevertheless, is this disclosure sheet something the dealer must provide to me since it will be a lease and not a sale?

I'm pretty sure it is.

timjoe

you all might be amused (i was) by what the salesman said when i requested they take the mudflaps off the deal....and i quote, "99.9% of people want them on their vehicle and Honda actually wants us to add them as soon as the vehicle arrives at the dealership."

lowmoneyfactor

timjoe said:

...Honda actually wants us to add them as soon as the vehicle arrives at the dealership."

On our prevoius several leases Honda/AHFC absorbed $1500 damage [now it's $1000] so will take this as a null. If the vehicle is stellar - in which case the turn-in dealer will pay AHFC and keep it in their lot as a USED car sell - AHFC sends it off straight-on to auction with damages...... those fender rock chips DO add up there.

lowmoneyfactor

timjoe

timjoe said:

it's odd that the feds don't require disclosure of the money factor but, nevertheless, is this disclosure sheet something the dealer must provide to me since it will be a lease and not a sale?

Michaell

Michaell said:

I'm pretty sure it is.

More than pretty sure... yep, that's the REGM Federal format of the lease document you'll sign:



REGULATION M

lowmoneyfactor

timjoe said:

my mistake...i meant to write "federal consumer leasing act disclosures"...here's an example i found:

A leaser after our own hearts: wondering about the Federal Disclosure Regulation M form all US leasees sign (dissimilar to the lease worksheets dealers provde)

Thank you for the worksheet you provided above...

Here is the REGM form we worked out for you based on your capitalized cost (negotiable), advanced ILLINOIS tax payments: Sign and Drive 282/month, (ie nothing down/282x35 mos.):

https://i.postimg.cc/gcgfSzsN/Tim-Accord.png

timjoe

thanks...my research is nearly done, thanks to this forum

timjoe

signed for a 2019 accord sport 1.5...sell price $23370...lease $290/mo for 36/12k...shown here with danish model...big-time thanks to everyone on the forum who helped a newbie make sense out of the process.

Michaell

timjoe said:

signed for a 2019 accord sport 1.5...sell price $23370...lease $290/mo for 36/12k...shown here with danish model...big-time thanks to everyone on the forum who helped a newbie make sense out of the process.

Congrats!

Thanks for the report.

lowmoneyfactor

timjoe said:

signed for a 2019 accord sport 1.5...sell price $23370...lease $290/mo for 36/12k...shown here with danish model...big-time thanks to everyone on the forum who helped a newbie make sense out of the process.

@timjoe

Thanks for the numbers report. Was this sign/drive or did you pay the first month at signing?

Would like to see the how the RegM form was filled out relative to your state taxing the lease up front and compare it to the lease spreadsheet I posted above based on the dealer worksheet you provided. Was the tax just dumped into the gross cap? If you have a chance

timjoe

paid the first month...and tax was dumped into the gross cap.

lowmoneyfactor

timjoe said:

paid the first month...and tax was dumped into the gross cap.

Thank you @timjoe!

The car AND model look GREAT! Thank you for the reply.

In the states we've lived in - working out the Regulation M entries on our spreadsheet - tax was always "by-the-month". First time we put the capitalized tax upfront AND it seemed to pretty much work out.

Based on your worksheet and https://i.postimg.cc/gcgfSzsN/Tim-Accord.png we provided above there was just a small difference.

Good negotiations for your car... hope to see you 'round in another three years

Regards, lowmoneyfactor