01-02-2018, 10:28 PM | #1 |
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Rent Charge 6614?!
Hi all,
Just got back from the dealer to see that my "rent charge" is listed as 6,614.00. For context the Depreciation and Amortized amounts add up to 30,924.31. Is there any recourse here? I have paperwork that was signed that says my money factor was locked in at .00152...in my haste to get in the car, I didn't see that the Rent Charge was so high. Thanks |
01-02-2018, 10:37 PM | #2 |
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What the heck is rent charge?
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01-02-2018, 11:01 PM | #4 |
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01-02-2018, 11:09 PM | #5 |
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So I figured it out (p.s. this is why I don't do leases). The dealer shafted me on the money factor by doing a nice little bait and switch. I was quoted at .00152, only to get .0019 or so (per my calculations).
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01-03-2018, 02:49 AM | #6 |
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The a way to defeat this, just go into the new car sales office when your numbers are 'plugged'. I did it yesterday for my PCD X5M, new sales manager was off yesterday who I ordered from so his associates had to prepare the paper work (wanted to Dec 2017 incentives and departed for Italy and flying. Back into GSP for the PCD next week. I told them what the price was ($1,000 under dealship coast), $4,000 in rebates and buy MF of 0.00152. I was told you have to be a really good customer to buy MF. Anyway, I was assisting putting the numbers into centernet for my deal. Also, helped that this was 5th BMW over six years from this center. My 'assigned' CA was clueless about the whole process- he gets the token PIA credit.
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01-03-2018, 11:07 AM | #9 |
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01-03-2018, 12:07 PM | #10 |
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Yea, that beings said, the "interest" on a lease makes no sense. You're better off financing the car for 6 years. You'll get a lower interest and net almost the same on payment. I'm running the numbers now...almost wish I went for the finance.
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01-03-2018, 12:27 PM | #11 | |
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All jokes aside, feel free to share your detailed analysis. I'd be interested in seeing it. |
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01-03-2018, 01:09 PM | #13 | |
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FWIW, a .00152 MF equates to about a 3.648% APR, while BMW's current finance rates are 3.89%.
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01-03-2018, 01:15 PM | #14 |
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BMWFS was also offering 0% for 60 months and 1.9% for 72 months using the demo car loophole. I'm not sure if these special financing offers have carried forward for 2018.
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01-03-2018, 01:19 PM | #15 |
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If you can snag a promo like that it can make purchasing a little more appealing, but you also have to remember in most states you'll be on the hook for an extra ~$50k worth of sales tax.
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01-03-2018, 01:49 PM | #16 | |
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Tomato / Tomato at the end of it all. It is nice to be able to give BMW two middle fingers when the car is ready for return in 3 years. |
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01-04-2018, 12:08 PM | #18 | |
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Mercedes-Benz and Porsche charge high lease rates because they don't want to eat the risk like BMW does ... So for me, if someone is offering to take risk off your plate for nothing, the polite thing to do is let them. But it is a much trickier financial contract that's widely misunderstood and also used to dupe morons - thus my advice is, if you can't/won't read a lease contract, NEVER do a lease because chances are you got screwed ... and the funny thing is, having done at least 20 across three brands and 10+ dealerships I've never had a single contract that (a.) The dealership finance department understood, and (b.) Wasn't chock full of errors. So if you did a lease and didn't read it all and tie all the numbers - it's probably wrong.
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Last edited by GrussGott; 01-04-2018 at 12:18 PM.. |
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01-04-2018, 01:03 PM | #19 |
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On a lease aren't you only paying interest on sale price - residual? So on a 60% residual and an 80k car (assume $0 discount) you're only paying interest on $32k, right?
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01-04-2018, 01:12 PM | #20 | |
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Think of it this way. BMWFS is loaning you $80k to buy a car, with an agreement to purchase the car from you after 3 years.
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01-04-2018, 02:00 PM | #21 | |
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You pay interest on the Net Cap Cost (or Adjusted Cap Cost), which is the total price of the vehicle minus any rebates, discounts, and downpayment AND the Residual, which is how much the car is worth at the end of the lease. Therefore, if your Adjusted Cap Cost is $72,000 ($80k MSRP minus $8k in rebates and dealer discount), then you add that to the residual $45 (ballpark number) and multiply it by your Money Factor: .00152. That will get you your monthly Rent Charge (in essence the cost to finance the vehicle). |
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01-04-2018, 02:06 PM | #22 |
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That's only if you finance. I paid cash and had no interest to pay.
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