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Prices Paid: Buying & Leasing Experiences Mazda3 Lease Questions
445 messages, Last post on Nov 23, 2009 at 6:54 PM
You are in the Prices Paid: Buying & Leasing Experiences Forum. Your Hosts are car_man & kyfdx
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Replying to: tracermag (Aug 24, 2007 8:42 am) A cursory look suggests to me that $500 below invoice falls within the domain of reasonableness. However, I would need to do some research that captures supply/demand considerations, incentives, etc. Having done that, I arrive at a sell price or agreed upon value. The sell price is reasonable and so I don't even consider all the other crap like doc fees, advertising, etc. And so "hidden profit" isn't even a consideration because there is none. Afterall, I'm the one that determines the selling price and, everything after that, just falls right into place. I'm always in control of the deal and that is the key. Another key to negotiating is DON'T. I have programmed my TI 84 calculator to do fairly sophisticated lease calculations and have created an excel spreadsheet that does it all including lease amortization schedules. I'm convinced my programs are superior to most, if not all, lease programs used by dealerships only because so many of them contain mathematical flaws. The numbers in my lease proposal are ALWAYS spot on. All the dealer needs to do is say YES or NO. If NO, I simply FAX/email to another dealer. If YES, they can trasfer the numbers in my proposal directly onto the lease agreement. I tell them to draw up the papers and have the keys ready because I don't want to spend any more than one-half hour at the dealership. Every number appearing in the lease contract must exactly match (to the penny) those in my proposal. I insist that the contract be completed correctly and I make that very clear to them beforehand. If their calculations don't match mine, then they made a mistake somewhere and I'm not about to argue with them or try to find their errors. They're in this business and they ought to know how the calcs are done. If not, I walk. End of discussion. Pretty simple, huh? I'm not going to get into a classroom discussion with any dealership about how they do their math. And, I'm not about to educate them either unless, of course, they are willing to compensate me. These people are not the brightest bulbs on the chandelier and academics just isn't a priority item. Most of them can't do math anyway and frequently argue that the "computer does it" with very little understanding. I am a mathematician and so leasing mathematics is a breeze for me. I can do this stuff in my sleep and they should be able to do so as well. But, that's life in America the Great. In Ohio, you have to be very careful particularly if you're considering a sign and drive lease. Dealers frequently miscalculate the payment and, hence, taxes are miscalculated as well. In Ohio, taxes are computed on the total payment. This payment is an intermediate payment, if you will, and is used only for the purpose of determining tax liability. Accordingly, it captures all taxable items capitalized in the lease. Non-taxable items (e.g., security deposit) must be kept seperate and out of this calulation. Therefore, it's important to seperate taxable items from non-taxable items. I have yet to find an Ohio dealer that can correctly compute a sign and drive lease. However, I did manage to find one dealer that agreed with my calculations after they input my numbers into their computer. However, they couldn't arrive at my numbers independently. Below is an example of what I'm talking about... _____________________________________________ 2007 Acura TSX Retail Pricing Information Base MSRP 2007Acura TSX 5 Speed Automatic (CL9687JW) ... 28,090.00 Premium Pearl White . . 0.00 Destination Charge . . 670.00 MSRP .. . ... 28,760.00 Agreed Upon Value . 26,700.00 Amounts Financed 1st Months Payment 361.71 Security Deposit .. 375.00 Acquisition Fee 595.00 Sales Tax  6.00% x 35 x 329.77
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692.52 Capitalized Costs Gross Capitalized Cost . 28,724.23 Capitalized Cost Reduction . . 0.00 Adjusted Capitalized Cost 28,724.23 Residual Data Residual Factor .. . . 0.62 Residual Value (Residual Factor Χ MSRP) . . . 17,831.20 Cost of Money/Term Money Factor . . . 0.00127 Term (months) . 36 Lease Payment Itemization Monthly Lease Payment including Sales Tax .. . . . 361.71 Monthly Lease Payment excluding Sales Tax .. .. 340.99 Taxable Monthly Lease Payment 329.77 ________________________________________________________________________________- - - - - - - ______ Charges Payable at Lease Origination License, Title, Registration Fees (estimated) . . . . . 120.00 Amount Due at Lease Signing .... .... . 120.00 Miscellaneous GAP Coverage Included Annual Mileage Allowance: 10,000 Disposition Fee: None Excess Mileage $0.15 per mile Reg. M Disclosure: NA ____________________________________________ John Medina, Ohio PS: If you're near Medina (near Cleveland), maybe we can have a cup of coffee. Good luck my friend. |
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Replying to: tracermag (Aug 24, 2007 8:42 am) One other area that I forgot to mention and that is the reserve level associated with the cost of money (i.e., money factor, interest rate). When I'm in the data collection mode, I always ask the dealer for the rate with 0% reserves. That rate is called the base rate or buy rate. Reserves work in much the same way that points do on mortgage loans. It is a form of dealer participation ( hidden profit) where the fund provider compensates the dealer for writing the lease at a higher money factor or interest rate. And so, reserves is another potential profit center for the dealer. For example, a fund provider's tiered rate structure might look something like this... 0.00130 + 0% reserves 0.00150 + 1% reserves 0.00170 + 2% reserves A 2% reserve level means that the dealer receives 2% of the adjusted capitalized cost (excluding any acquisition/bank fee). The customer never sees the 2% because it's embedded in the money factor or interest rate. So, I suppose that would be classified as financing hidden profit. Aware of this "hidden profit", I always ask for the buy rate. If the dealer insists on 1% or 2% reserves, I simply deduct the dollar equivalent from the agreed upon value. Sort of like the Rob Peter to Pay Paul Principle. They can jack up the rate as much as they like and I just deduct it from the sell price and use the result as my new sell price. John |
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Replying to: Car_man (Aug 31, 2005 3:50 pm) |
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Hi Car man, I live in Maryland and I am in the middle of looking to lease a Mazda3 GT 5 door(hatchback) I visited the local Mazda dealer and they gave me the following price: Mazda 3 5 door Grand Touring w/Moonroof + Bose package and other additions MSRP: $22,875 Selling Price: $21,785 Could you work up a lease package for 24 months/15,000 a year. Also, what is the current money factor and residual? Thanks in advace.
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Replying to: pfje (Aug 31, 2007 11:00 am) I guesstimate your pyments for 24 months to be 350-360 a month.
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Replying to: steevo (Sep 01, 2007 5:13 am) thats a nice price..is that a 2008? |
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Hello all, Here is the currently proposed deal with no money down. 2007 Mazda3 GT 5 door with Bose/sunroof package and automatic transmission. MSRP $22,775 Selling price $21,805 Residual 64% Money factor .00154 Taxes $1,095 (taxes are 5% in Maryland) Acquisition fee $595 Processing fee $99 The monthly payment would be $443.27 What does everyone think? I have a few questions. Are taxes figured out on the total cost of the vehicle or on the monthly payment? Should I pay the taxes up front or put them into the monthly payment? Is the acquisition fee and processing fee negotiable? Any other comments would be greatly appreciated. Thank you. |
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Replying to: pfje (Sep 05, 2007 5:20 am)
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Replying to: qbrozen (Sep 05, 2007 6:46 am) I calculated the lease on my own came up with an an approximate payment of $375. I'm not sure how taxes are calculated in Maryland - up front on the total selling price or by the monthly payment price. Thanks in advance for any suggestions and/or advice.
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Replying to: pfje (Sep 05, 2007 7:52 am) But, at that monthly price, I'd buy the car.. You'd get the same payment over 60 months, more or less.. Unless you are upside-down on a trade, that price seems way out of line... 
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