Does it matter where I apply my trade equity in a new lease?

Comments

• kyfdx Moderator Posts: 269,877

  February 2024

  Rickgrimes2020 said:

  Live in PA. Have $2k equity in my trade. Is it better to

  A: put the $2k to reducing cap cost and then rolling all fees into lease (zero DAS}
  
  B: put it to paying fees, taxes, 1st month (essentially $2000 DAS)
  
  C: Take the equity in form of a check, deposit it in an account and divide it into equal monthly payments across the lease.

  Or does it not matter?

  The dealer may require you to use it as a CAP cost reduction, due to state sales tax rules. But, if they’ll apply it to non-taxable upfront items first, that would be slightly beneficial.
  
  I wouldn’t bother taking the equity as a check for that small of an amount

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• EfrainCooke Member Posts: 25

  February 2024

  I would prefer the offer B. Using the $2k to cover fees, taxes, and the first month's payment (essentially $2000 due at signing) can result in higher monthly lease payments but lower upfront costs. This option may be preferable if you prefer to have lower initial out-of-pocket expenses and are comfortable with slightly higher monthly payments.

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