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How to Calculate Monthly Lease Payments

173 messages,  Last post on Apr 11, 2013 at 2:36 PM

You are in the Prices Paid - Buying & Leasing Experiences Forum.

What is this discussion about? Car Leasing

Dissecting the Deal - How To Spot a Good Lease
 
10 Steps to Leasing a New Car
 
The "Residual Value" of Leasing
 
Calculate Your Own Lease Payment

Messages Page 17 of 18

#161 of 173 Re: Taxes on lease [delta737h] by qbrozen

Feb 20, 2013 (12:09 pm)

Replying to: delta737h (Feb 19, 2013 3:25 pm)
I don't believe the tax is capitalized in NJ. At least, I can't find any evidence that supports that.
 
So that OH lease you pasted, I can see that, if interest wasn't charged on the tax, the payment would be about 60 cents less. AFAIK, if you did that same lease in NJ, the payment would be $220.38.
 
Maybe I'll see if my sister can bring over her lease contracts we did a few weeks ago so I can take a look.

#162 of 173 Re: Taxes on lease [qbrozen] by delta737h

Feb 20, 2013 (12:27 pm)

Replying to: qbrozen (Feb 20, 2013 12:09 pm)
Tax can be capitalized at the lessee's request. I have constructed several lease proposals for individuals in the State of NJ over the past three (3) years and have never had a problem with any of the NJ dealerships doing this. They really don't care and neither does the State of NJ. Either way, NJ will receive the tax payment upfront. The fund provider simply advances the dealer the cash to pay the taxes and the lessee re-pays the tax, included in their lease payment, over the term of the lease.
 
If you have any questions about the lease contract, please let me know.
I'll be glad to address them.
 
John

#163 of 173 Need Help with Payment by javacafe

Feb 20, 2013 (2:26 pm)

I received an offer from a Volkswagen dealer on a 2013 CC
 
MSRP 32890
 
Sell price 29576
 
Money factor.00010
 
Payment of $479/month with $1000 down + fees.
 
Is this a good deal??

#164 of 173 Re: Taxes on lease [delta737h] by qbrozen

Feb 20, 2013 (2:39 pm)

Replying to: delta737h (Feb 20, 2013 12:27 pm)
I'm having a tough time following your posts. I thought you used the term "capitalized" to mean the total the interest is charged on. The simple question is, "does NJ charge interest on the tax if you don't pay it up front?"
 
I'm saying no, because that's what I've read. Are you saying yes or no?

#165 of 173 Re: Taxes on lease [qbrozen] by kyfdx HOST

Feb 20, 2013 (4:36 pm)

Replying to: qbrozen (Feb 20, 2013 2:39 pm)
NJ collects the tax upfront...
 
If you wish your bank to pay the tax and then add the amount to your capitalized cost, then you will certainly pay finance charges on that amount...
 
NJ doesn't care.... they always get it upfront...

#166 of 173 Awww by bwaa

Feb 21, 2013 (12:03 pm)

ARRRGH I WISH I HAD READ THIS POST BEFORE I LEASED MY SUBARU FORRESTER AHHHH :'(

#167 of 173 Re: Taxes on lease [qbrozen] by delta737h

Feb 22, 2013 (7:18 pm)

Replying to: qbrozen (Feb 20, 2013 2:39 pm)
NJ does not charge interest on the tax if it's not paid upfront because they're not the entity that funds the lease. It's the fund provider that charges interest on the tax if it's not paid upfront because the tax is financed (capitalized) in the lease. NJ does not finance leases. Banks and manufacturer finance subsidiaries (e.g., American Honda Finance, etc.) finance leases.
 
John
TheAutoLeaseGeek

#168 of 173 Re: Taxes on lease [delta737h] by qbrozen

Feb 23, 2013 (8:52 am)

Replying to: delta737h (Feb 22, 2013 7:18 pm)
I didn't actually mean the state of NJ. I meant in NJ. I am well aware NJ isn't charging interest like a lender.

#169 of 173 Help on getting monthly payments right by sepi60

Mar 18, 2013 (3:00 pm)

Hello everyone:
  
So, I'm trying to practice my calculations before going to the dealer today, but something doesn't add up. For the lease special offered at:
  
http://www.bmwusa.com/standard/content/Vehicles/2013/X1/xDrive28i/
  
with MSRP of $38,345, $725 Acquisition fee, $750 loyalty rebate, and $3,624 first month (including $2500 down, $725 acq. fee and $399 first month payment), I get monthly payments of $412 (pretax and excluding license and reg), when I use 0.0013 for money factor and 0.6 residual factor for 10,000 miles per year. (these are the values currently offered by BMW financials).
  
Here is my calculations:
Net Cap Cost = 38345 (MSRP) + 725 (acq. fee) - 2500 (down payment) - 725 (acq. fee paid upfront) - 750 (loyalty rebate) = 35095
  
Month depreciation = (35095-23007)/36 = 336
Interest = (35095+23007)*.0013 = 76
  
Total = 336+76 = 412
 
The only way that I can $399 seems to be if I include first month payment in "cap cost reductions", to bring the net cap cost down to $34696, which reduces the monthly depreciation to
$325 and the finance charge to $75 (total ~$400). But including first month payment in the "cap cost reduction" doesn't make sense to me. If I do that, should I then divide the total depreciation by 35 instead of 36 (since one month is already paid)?
 
Am I missing something?
  
Thanks much

#170 of 173 Re: Help on getting monthly payments right [sepi60] by kyfdx HOST

Mar 18, 2013 (5:30 pm)

Replying to: sepi60 (Mar 18, 2013 3:00 pm)
What you are missing is the selling price of the vehicle... You aren't going to pay MSRP, are you?
 
There is an unspecified dealer discount in the advertisement...

Messages Page 17 of 18

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