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2020 Tacoma Lease Payment

Discussion in '3rd Gen. Tacomas (2016-2023)' started by SunnyDTaco619, Oct 3, 2019.

  1. Oct 13, 2019 at 4:14 PM
    #101
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    I would ask them to show you exactly what the cap and residual are. The cap should be what you negotiated off the MSRP

    Also....make sure the payment has nothing else built in...gap insurance, extra maintenance or care of any kind. You also want to know exactly where your $1k is going. If they fail to provide any of that....walk.
     
  2. Oct 13, 2019 at 4:23 PM
    #102
    brosenz

    brosenz Well-Known Member

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    Please could explain the concepts and terms, I am confused, thanks
     
  3. Oct 13, 2019 at 4:29 PM
    #103
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    Cap cost = the price

    Residual = predetermined value of the vehicle after the lease is over (assuming in average condition and within alloted mileage)

    Term = length of lease/buy

    When you lease you basically pay the depreciation. So it's the difference between the cap cost and the residual. The smaller the gap, the smaller the payment
     
  4. Oct 13, 2019 at 5:10 PM
    #104
    brosenz

    brosenz Well-Known Member

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    Thank you, please could you explain couple of concepts:

    - What is cap cost, Sale price? Meaning MSRP - Discount?
    - How do you calculate residual, is it 72% of MSRP (40K) or Sale price (35.5K)?

    Thanks
     
  5. Oct 13, 2019 at 6:21 PM
    #105
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    The cap cost should be the negotiated price of the vehicle. Whenever possible you want the dealer to lower the cap cost to make the gap between the it and the residual smaller. Its no different than negotiating the price off MSRP when you're buying it. Then tell them you want that negotiated price used as the cap cost.

    If you decide to lower the cap cost more by putting your own money (cap cost reduction), more down payment for lack of a better term....have them figure the lease both ways....with and without your money in the deal. You may find that there isn't a significant difference. Take the difference in the 2 payments X 36 months. If that number is greater than your "down payment" then it might make sense to do it. If not, hang on to your cash.

    As for the residual? No way for me to know how that's being calculated. But if they're telling you 72% then I'm sure that would be off MSRP. Unless it's some sort of subsidized lease from Toyota Financial Service. Then the residual could be fluffed up.
     
  6. Oct 13, 2019 at 6:37 PM
    #106
    brosenz

    brosenz Well-Known Member

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    In my case with the 2020 TRD Sport, MSRP = 40K, they gave me 4.5K discount, that means the cap cost is 35.5K
    Residual = 72% of MSRP = 40K * 0.72 = 28.8K
    MF = 0.00205


    Monthly payment will be broke down like this:

    Depreciation = (35.5K - 28.8K) / 36 = 186
    Rental charge = (35.5K + 28.8K) * 0.00205 = 132
    Taxes (6.5% FL) = 21
    Monthly charge = 339


    Other charges (dealer fees, tag, registration) = 2.4K / 36 = 68
    Monthly total = 339 + 68 = 407


    They were charging me $439, and I offered $400 with 1K (-$30/month) down, meaning I reduced the payment by additional $9/month= $430 with $0 down (sign & drive)

    They were telling me they were loosing money, I don't think so, unless my calculations are wrong. Thoughts?
     
    Last edited: Oct 13, 2019
  7. Oct 13, 2019 at 7:12 PM
    #107
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    Are you saying you offered to throw $1000 into the deal and it lowered your payment $9 a month? If so, that doesn't favor you. $9X36 = $324. You're better off keeping your money.

    I can understand some dealer fees....registration and title maybe. But where does the $2.4k come from?

    You're paying 6.5% of the base payment per month. They can't turn around and charge you sales tax again
     
  8. Oct 13, 2019 at 7:20 PM
    #108
    brosenz

    brosenz Well-Known Member

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    Please let me clarify:

    They asked for $439/month, I said $400 with $1K down, $1K equates to $30/month and I asked them to lower another $9.

    Regarding the 2.4K it was around $0.9K dealer fee, then $0.8K another dealer fee and 0.7K tag and registration, no more taxes. I questioned them why the 2 dealer fees, they gave me an explanation that I didn't buy it, but went along.

    I hope this clarifies, do you agree with my calculation, numbers and formulas overall?
     
  9. Oct 13, 2019 at 7:28 PM
    #109
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    The lease itself sounds good. But $2400 in dealer fees is absurd. They deserve to make money, just like any business. However, those fees would cause me to walk. But that's just me. My local dealer charges $699 for title/registration.

    Tell them you'll do $1000 on all fees and you'll sign right now. They want to hear a commitment to buy now. If they say no....walk away for a day or 2. A good salesman will call you back within a few hours to a day or so. Let them make the next move after your offer
     
  10. Oct 13, 2019 at 7:34 PM
    #110
    brosenz

    brosenz Well-Known Member

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    One of the fees was "Pre-delivery Service charge": $995
    The other one was like "Dealer Service Fee": $699
    Tag and Registration: $600

    I agree with you, they should charge only one of them, both seems abusive.
     
  11. Oct 13, 2019 at 7:36 PM
    #111
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    Too much. Just too damn much in my opinion
     
  12. Oct 13, 2019 at 7:37 PM
    #112
    brosenz

    brosenz Well-Known Member

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    Note that this is a sign & drive deal, meaning the $2,400 is included in the $400/month. No even first payment, all included in the $400, that means I have only 35 payments of $400. Actual lease payment is less, $400 x 35 / 36 = $389
     
  13. Oct 13, 2019 at 7:42 PM
    #113
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    But if you offer $1000 on the fees, that basically lowers the cap by $1400, further reducing your payment

    With $2400 in dealer fees they aren't "loosing money"

    However, if you're comfortable with the numbers as they are, then I say go for it. A "good deal" is as much a state of mind as it is raw numbers
     
  14. Oct 13, 2019 at 7:43 PM
    #114
    brosenz

    brosenz Well-Known Member

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    Thank you, I really appreciate all the feedback and advice
     
  15. Oct 13, 2019 at 7:44 PM
    #115
    Plain Jane Taco

    Plain Jane Taco ALL human beings deserve equal treatment

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    No problem.

    I've leased many vehicles over the years for my wife.
     
  16. Oct 13, 2019 at 7:48 PM
    #116
    brosenz

    brosenz Well-Known Member

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    Somebody told me once, that a 1% of MSRP for monthly payment is a very good lease, that's what I always use as a target, in this case 1% of 40K (MSRP) = $400/month, I have to get rid of the 1K down to be on track.
     
  17. Oct 13, 2019 at 7:55 PM
    #117
    Plain Jane Taco

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    Sounds about right.

    If you like a new vehicle every 3 years, always under warranty and you keep your vehicle in at least average condition, then leasing can be right for you.

    Make sure the mileage allotment works for you. If you go over it can get pricey at the end of the lease. Too little and you've paid for miles you never used.

    Good thing about the Tacoma, is it's resale is strong enough to probably trade it in a month or 2 before the lease ends to avoid any mileage penalties as opposed to turning it in at the end
     
  18. Oct 13, 2019 at 8:06 PM
    #118
    Navigator1

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    What was the Cap cost and residual on this. That’s a good deal.
     
  19. Oct 14, 2019 at 11:22 AM
    #119
    350DGRZ

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    You should never put a down payment on a lease.
     
  20. Oct 22, 2019 at 9:51 AM
    #120
    Skythings

    Skythings Well-Known Member

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    No disrespect - however such a blanket general statement is not always applicable. Every leasing company is different and every lease is unique and every person is unique. There are times to put money down which do work to your personal advantage or situation. Toyota Canada used to have a interest buy down plan where you could put up to 10 security deposits down on your lease. Each security deposit bought your interest rate down 1/2 a percent. I put down $10,000 to bring my monthly payment on a Tacoma down to $200 per month. Put down another $2000 in security deposits, brought my interest rate down to zero. At the end of the lease I exercised my first right to purchase, got my $2000 multiple security deposits back and put that down towards the truck and bought the truck for my previously agreed residual amount based on a negotiated final price, not MSRP. When I ran the spreadsheets for finance vs lease, the lease was slightly more expensive ($600) over a 48 month term & refinancing the buyout amount over 3 years, but it gave me so many more options than financing at a time of uncertain income. That worked for my specific situation then. Turned out my income was stronger than planned when I originally signed the lease and I paid the buyout in cash.

    I love leasing because I can generally tailor a lease to fit my specific situation. To me leasing is simply another way to finance a vehicle with much more flexibility and many more options verses traditional financing. The fundamental key to leasing is the type of vehicle & the type of lease. Vehicles such as Tacoma's hold their values so well that you would be an absolute idiot to return your truck to the dealership at the end of the lease and not exercise your option to purchase. (walk away or closed end leases) I have seen up to $8000 in equity in a Tacoma at the end of a lease. Drop that truck off at the dealership, they ding you for cracked windshield, burns in the upholstery and then they keep your $8000 in equity. If during the term of your lease the Tacoma market collapses, then you have that option to return it to the dealer and make it their problem. If you financed it, it's yours and the banks.

    Something to consider also is the annual mileage charges. In most leases these overage charges are only applicable if you return your vehicle at the end of the lease. If you buy it out at the lease end, you do not pay these overages. Negotiate the lease with the lowest annual mileage as possible if you know your buying it out anyways.
     
    itrsteve likes this.

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