Last post on Dec 12, 2013 at 4:17 PM
You are in the Prices Paid - Buying & Leasing Experiences
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Lexus RX 450h, Lexus RX 350, Car Leasing, SUV
#800 of 2773 Re: money factor for Houston dealership was too high? [gotlogos1]
Dec 14, 2007 (6:11 pm)
Just to add to this information - the dealership said they were absorbing the sales tax on this vehicle as part of their promotion for December. Is there normally a sales tax that is added to the purchase price of a LEASE or is it normally added to the monthly payment?
Here is the deal we made:
2008 Lexus RX 350 FWD w/ Nav, Prem. Plus, Heated seats & Rain sensing wipers, Liquid Graphite 18 inch wheels, Cargo mat and wheel locks
+ $300.00 Front Tinted Windows (dealer installed)
+ $200.00 pin stripe
$41,000.00 (Paid, savings of $3, 966.00)
+ $134.05 (Title, License, Registration fees)
+ $600.00 (Acquisition fee)
+ $506.00 (L&M fee and Doc fee)
$42,240.05 (total capitalized cost for the LEASE)
$632.70 monthly (36 month/ 36K Lease with .00225 money factor, $632.70 due at signing which was first month payment)
(Dealer provides free loaner car for services except oil change and free pickup and delivery for any major service such as the 15K service. All services are free for first 25K - I am assuming this is standard for any Lexus new car lease or purchase? Except for the free pickup and delivery for the 15K service?)
It appears from this forum that the BUY rate for this lease is .00155 from LFS to the dealer, during the December to Remember Sales Event. The dealer has to work from this. I understand there will probably be some mark-up, but at this point, I am wondering if I paid too much of a mark-up at .00225? I am not sweating it though, I didn't find this forum until too late. I am educated for my next rendevous. They did start at .00255 and reduced it to .00225. They themselves told us we had excellent credit.
I would appreciate any feedback on this deal and also, what are the facts with sales tax on a lease? Did I indeed receive a 'special deal' on this that you normally don't get outside of their sales events, where they 'absorb' the sales tax cost? They charged the L&M fee (1.25 percent) as part of that 'deal', giving me a net savings on sales tax of about 1800.00 or so (??).
The market is Houston, Texas.
TIA for any feedback!
#801 of 2773 Re: money factor for Houston dealership was too high? [gotlogos1]
Dec 14, 2007 (8:14 pm)
I'm not sure how it is done in Texas, but in Washington the sales tax is added to each lease payment. You didn't state the residual used in your lease calculation, but assuming it is 56% (which is what CarMan provided in earlier posts) then I get a lease payment of $625.56 without adding any tax. A calculation using the Tier-1+ money factor of .00155 gives a lease payment of $578.37. Adding a 9.1% tax to that would give a payment of $631.00. I think your dealer is "absorbing" the sales tax (and more) by charging you the much higher money factor! Deceptive!
#802 of 2773 Re: money factor for Houston dealership was too high? [briegel]
Dec 14, 2007 (8:45 pm)
Thanks briegel...It appears in Texas, not sure, but you pay the tax up front otherwise, no matter what the promotion, they would have to show a monthly breakout of the sales tax on the financing disclosure, which they do not, it simply lists the payment.
Two dealerships mentioned this sales tax promotion, so I think it is very legitimate. I would like to hear what other Sales event customers have experienced this month.
Maybe it is because of the sales tax absorption, basically a gimmick (shrugs), that they may not have had the room to provide a lower money factor. But I am sure I could have negotiated a few points lower if I knew their buy rate.
Overall I feel good about the deal, but i woul dfeel very good if I could confirm that I indeed saved a legit 1.5-2 grand in the deal via sales tax gimmick.
And of course, I learned much from the experience and I do love the car.
#803 of 2773 Re: Money Factor & Residual on 2008 RX 350 FrontWD [Car_man]
Dec 14, 2007 (9:01 pm)
Thanks Car man. Just leased my 2008 Lexus RX last Friday. Decided not to get Navigation System. Felt I didn't really need it. Anyway, here is the deal I got with the Lexus Dealer in Birmingham, AL.
Got the 2008 Lexus RX Luxury Value Edition, with memory seats, rainsensing wipers, and towing prep package for $37,000. 36 month lease with .00155 money factor, 15,000 miles per year. Monthly payment including lease tax is $546. Paid $965.00 up-front fees. Considering there is not much competition for the dealer in our area, I feel I got a pretty good deal. I'm VERY HAPPY WITH MY NEW LEXUS!!! Thanks for your help.
#804 of 2773 Re: money factor for Houston dealership was too high? [gotlogos1]
Dec 14, 2007 (9:28 pm)
You essentially got the equivalent of the "December to Remember" promotion money factor (.00155) and paid the sales tax (rolled into the lease payment). They just played games with how they presented it to you.
#805 of 2773 Re: money factor for Houston dealership was too high? [briegel]
Dec 14, 2007 (9:47 pm)
Just to make sure we have FACTS here, to help us all...They spoke of L&M money and this was listed on the sales/lease contract as part of the fees.
They mentioned that Lexus, not them, was payin 5 percent of the sales tax. Subtracted from our 6.25 percent rate in Texas for new car purchases. They essentially aborbed about 1800.00. We paid the other 1.25 percent via the L&M fee itemization.
They started at .00255 at the one dealership in town and when we mentioned to the dealership that we eventually bought from that the other dealership offered .00225 money factor, they matched it with no questions.
Both dealers volunteered the sales tax promotion info so I don't think this was a sales gimmick/sleazy tactic ONE of the dealers used. I think it is a GIMMICK but somehow it comes from LFS and is either regional or national. The GIMMICK does seem to save you money but its playing games, confusing to the customer, I certainly would rather not play games.
I'm just curious if other purchasers this month were told about the sales tax promotion and what kind of MF they paid. I want to know if we way over paid on the MF. If so, I have issues with my local dealership. Of course it is contingent on what the bottom line out-the-door lease payment was...i.e. if they did indeed play games with numbers but we still got a good overall deal because they gave us a higher discount on the car, then ok, but I know next time I will be a much better informed lease customer.
#806 of 2773 Re: money factor for Houston dealership was too high? [gotlogos1]
Dec 14, 2007 (10:02 pm)
That promotion must be regional. They (LFS) are getting the sales tax promotion covered by a higher money factor than is available in other parts of the country. It probably works out to be about the same.
#807 of 2773 Re: money factor for Houston dealership was too high? [briegel]
Dec 14, 2007 (10:25 pm)
Yes...I am thinking it must be regional as I don't see anyone here talkign about it...
They do mention that there is x amount of taxes and fees rolled up into the monthly payment. Bottom lin eis- if it is tax deducatible...you need ot be able to separate out that tax...
#808 of 2773 Re: RX 350 Lease in So Cal [socalguy61]
Dec 17, 2007 (10:22 am)
Longo Lexus through their Internet dept (This is the 4th car my husband and I have bought/leased from Longo Internet dept.) I would recommend them for Toyota and Lexus. They don't tack on "paint protection" "lojack" or any "extras" as many of the other SoCal dealers seem to do. We have found the best price their, probably because they are the biggest dealer in SoCal.
Dec 21, 2007 (8:50 pm)
Does anyone know if the 400h qualifies for the Dec to Remember lease money factor of .00155 posted elsewhere on these forums. I am being told the mf for the hybrid is .00275 and that the lower mf is only for the gas RX. I am getting a good discount off MSRP of $3,000. Thanx!