Lease then Buyout - Contract Explanation

[jd284]

So a $40,000 car would have roughly $3k in sales tax figured into the LEASE price. Then when you want to buy out the lease , you pay ANOTHER $3k in tax? So $6k in tax on a $40,000 car?

no, it’s a little different. The upfront tax in CT is for cap cost reduction only. Mine was $653 which I think was for the rebate. Monthly tax is based on the payment. Buyout sales tax is based on the number in the Kia portal which will be 2-3k depending on the number

 

[gbears]

So a $40,000 car would have roughly $3k in sales tax figured into the LEASE price. Then when you want to buy out the lease , you pay ANOTHER $3k in tax? So $6k in tax on a $40,000 car?

In IL, the upfront taxes are basically taxes on the leased $ amount of the car. And you have to pay taxes on the lease cash.
When you buyout, the taxes are off the Adjusted Cap Cost, basically the $ value remaining on the car.

If you go back a few pages in the thread, @jd284 helped explain this to me. There is an article as well. If you live in Chicago, the lease buyout isn't going to worth it, as Chicago taxes even more.

 

[jjanda]

I've been lurking for some time, but finally looking to pull the trigger on a GT2.

I am in IL, not in Chicago so I guess I want to fully understand the taxes.

The sticker on the car is 55k, I was able to get the dealer to come to 48,200 before the incentive so 38 flat after. It seems like a good deal to me, but I feel like I should be paying 37k max after incentive. I have never leased a car, so not fully understanding of what I am doing but I feel somewhat comfortable after reading through these threads. I plan on buying out right away and putting 15k down and financing the rest through my credit union.

Is anyone able to comment on whether or not this deal is sound?

 

[stasek]

You're getting a

I've been lurking for some time, but finally looking to pull the trigger on a GT2.

I am in IL, not in Chicago so I guess I want to fully understand the taxes.

The sticker on the car is 55k, I was able to get the dealer to come to 48,200 before the incentive so 38 flat after. It seems like a good deal to me, but I feel like I should be paying 37k max after incentive. I have never leased a car, so not fully understanding of what I am doing but I feel somewhat comfortable after reading through these threads. I plan on buying out right away and putting 15k down and financing the rest through my credit union.

Is anyone able to comment on whether or not this deal is sound?

You're getting a really good dealer discount, so with current incentives, this is probably as good as it gets. I'm also in IL - which dealer are you working with?

 

[jjanda]

You're getting a


You're getting a really good dealer discount, so with current incentives, this is probably as good as it gets. I'm also in IL - which dealer are you working with?

Schaumburg, going to willowbrook tomorrow. I will say I went to Napleton Acura/Kia in Elmhurst and had the worst customer service ever. Wanted to get a gauge of prices but the guy would not talk unless I was buying today. Not sure if that is standard in the industry or if the guy was an a**hole.

 

[stasek]

Schaumburg, going to willowbrook tomorrow. I will say I went to Napleton Acura/Kia in Elmhurst and had the worst customer service ever. Wanted to get a gauge of prices but the guy would not talk unless I was buying today. Not sure if that is standard in the industry or if the guy was an a**hole.

Haha.... I'm still searching for my Stinger, but came close couple times. Schaumburg was a good experience - would have probably purchased one from them (2.0 Base w/ Sun & sound package), but wanted the Premium (talking 2019 model).
There's something about the Napletons.... I chronicled my adventure with Napleton Kia of Elgin here....

Another one bites the dust....

Just picked up a leftover ‘19 Premium. Wanted to do the balloon financing, but apparently it’s not available in Illinois at this time. Did the 24/10k lease to take advantage of largest rebate. MSRP - $42590. After dealer discount and rebate - $26800. After TTL and fees, I should be in at...

stingerforum.org

If you haven't done so, check out Classic Kia in Waukegan - they were also quite transparent and willing to work the numbers via email, but again - they only had the Base Stinger.

 

[jjanda]

Haha.... I'm still searching for my Stinger, but came close couple times. Schaumburg was a good experience - would have probably purchased one from them (2.0 Base w/ Sun & sound package), but wanted the Premium (talking 2019 model).
There's something about the Napletons.... I chronicled my adventure with Napleton Kia of Elgin here....

If you haven't done so, check out Classic Kia in Waukegan - they were also quite transparent and willing to work the numbers via email, but again - they only had the Base Stinger.

Funny my brothers fiancée actually worked for Napleton as an accountant for a short period and the way they did stuff was.. sketchy at best.

I guess running through the numbers they gave me seem off though now that i’m looking. I have $48,200-10,200=$38,000. 24 payments at $791. Something seems off with that high payment, hoping they can give me a full contract to look over with official numbers.

Of course going to use this number to get another dealer to come down to 36-37k.

 

[gbears]

I've been lurking for some time, but finally looking to pull the trigger on a GT2.

I am in IL, not in Chicago so I guess I want to fully understand the taxes.

The sticker on the car is 55k, I was able to get the dealer to come to 48,200 before the incentive so 38 flat after. It seems like a good deal to me, but I feel like I should be paying 37k max after incentive. I have never leased a car, so not fully understanding of what I am doing but I feel somewhat comfortable after reading through these threads. I plan on buying out right away and putting 15k down and financing the rest through my credit union.

Is anyone able to comment on whether or not this deal is sound?

A lot of Illinois love lately. I couldn't get any one to get below 50K on 2020 GT2. I went to Napleton Elgin, Schaumburg, Gerald and also emailed/talked with Gary Lang.

Napleton was horrible. Schaumburg had a good price. I ended up going with Gerald because they had the metal color and was a better dealership experience.

Seems like a good deal. If you want the car, pull the trigger and don't look back.

Get the Adjusted Cap Cost number from them if you are buying out. It will be higher than 38 because of the taxes.

 

[jjanda]

A lot of Illinois love lately. I couldn't get any one to get below 50K on 2020 GT2. I went to Napleton Elgin, Schaumburg, Gerald and also emailed/talked with Gary Lang.

Napleton was horrible. Schaumburg had a good price. I ended up going with Gerald because they had the metal color and was a better dealership experience.

Seems like a good deal. If you want the car, pull the trigger and don't look back.

Get the Adjusted Cap Cost number from them if you are buying out. It will be higher than 38 because of the taxes.

I’m really leaning towards pulling the trigger. Gonna sit on the idea until end of June though. Looking at the incentives history I know this 10.2k isn’t going anywhere, and I am fairly certain the car will be there in a month.

 

[Larson]

@ProsperDad Thanks for the responses. I'm chatting w/ dealers today on a deal for a WHITE/black GT2. Van Griffith Kia in Granbury is coming back to me with the wrong rebate values and something different for a balloon vs. lease rebate, so I'm looking at Alliance and Mesquite. Unfortunately, Huffine's McKinney doesn't have the combo I'm looking for right now.

Alliance is mentioning something about the powertrain warranty not transferring if I buy it out, unless I get it certified first and then buy it.

 

[Larson]

So either I'm confused on this whole buyout process or the dealers are. Just got off the phone with a dealer who was telling me there are different rebates for doing the balloon loan vs. lease. He also seemed to think that even though you could buyout on both, with the lease, you'd still have additional costs to cover, even though the rebate is more.

I thought I would be spending most of my time talking dealers down off MSRP, but it seems like I'm just trying to find someone who understands the rebates and balloon buyout at this point (or correcting my misunderstanding).

 

[Irregularburger]

So either I'm confused on this whole buyout process or the dealers are. Just got off the phone with a dealer who was telling me there are different rebates for doing the balloon loan vs. lease. He also seemed to think that even though you could buyout on both, with the lease, you'd still have additional costs to cover, even though the rebate is more.

I thought I would be spending most of my time talking dealers down off MSRP, but it seems like I'm just trying to find someone who understands the rebates and balloon buyout at this point (or correcting my misunderstanding).

Try call KMF they are the one approving leases/loans and sending out actual cash incentives.

 

[snsn]

Silly Question - Is the Lease / Buy Out still working with Kia?
In NJ , I just leased a GT Line - MSRP $39,870 - $6600 Cap Cost Reduction - $33,271 Tot Cap Cost - $18,738 -Adj Cap Cost Res Value, $24,787 - Tot Num of Periodic Payments.
My Monthly is Lease is $495 x 36 mos including tax.
But when I go to my account at Kia Finance the payoff is $35,024.68?
Is this correct? I'm not sure I understand how it works?

 

[Paul32]

Silly Question - Is the Lease / Buy Out still working with Kia?
In NJ , I just leased a GT Line - MSRP $39,870 - $6600 Cap Cost Reduction - $33,271 Tot Cap Cost - $18,738 -Adj Cap Cost Res Value, $24,787 - Tot Num of Periodic Payments.
My Monthly is Lease is $495 x 36 mos including tax.
But when I go to my account at Kia Finance the payoff is $35,024.68?
Is this correct? I'm not sure I understand how it works?

Looks like sales tax.

 

[spiker1234]

Hey guys. So I'm from NJ and going to attempt this lease buyout thing, but have some questions specifically about taxes and add on prices after negotiating the price for the car. I went to the dealer today and the math just doesn't add up to me. I will attach a picture of the leasing agreement, so hopefully someone can make heads or tails of it. How does the deal look to you guys?

Looking at buying a 2020 GT1 AWD Cermaic in silver with red interior. MSRP is $49,140. Was only able to negotiate dealer price down to $45,000. I will be shopping around as that doesn't sound like a great markoff from MSRP. They are going to offer me $250 for my beater of a car, and apparently will get another $750 for the trade in via kia as an incentive (is this true because I haven't heard of this offer?). Leash cash incentives this month are $8,600. So total I would be at $9,350 in incentives + $250 for my trade in which comes to a total of $9,600. That would all be subtracted from $45,000. From there on out I get completely lost on how taxes, title fees, and doc fees fit into calculating the adjusted cap cost, which looks like they have calculated to be $39,155.50. Do the bullcrap doc fees, and online processing fees get calculated into the adjusted cap cost or is it just the taxes and incentives?

Is anyone familiar with NJ? From what I've read we get taxed twice - once for the lease and then again for when you purchase the vehicle.

There is a luxury tax that gets added in NJ for any car that is > $45k, so obviously I need to get my vehicle price below $45k to avoid that $180 fee haha. And looks like a bunch of added on fees like $479 doc fee, $10online processing fee, $5 temp tag, $10 trade title fee, etc. that I will hopefully try to avoid by going to another dealer.

Thoughts? Any and all help is appreciated

 

[jjanda]

Hey guys. So I'm from NJ and going to attempt this lease buyout thing, but have some questions specifically about taxes and add on prices after negotiating the price for the car. I went to the dealer today and the math just doesn't add up to me. I will attach a picture of the leasing agreement, so hopefully someone can make heads or tails of it. How does the deal look to you guys?

Looking at buying a 2020 GT1 AWD Cermaic in silver with red interior. MSRP is $49,140. Was only able to negotiate dealer price down to $45,000. I will be shopping around as that doesn't sound like a great markoff from MSRP. They are going to offer me $250 for my beater of a car, and apparently will get another $750 for the trade in via kia as an incentive (is this true because I haven't heard of this offer?). Leash cash incentives this month are $8,600. So total I would be at $9,350 in incentives + $250 for my trade in which comes to a total of $9,600. That would all be subtracted from $45,000. From there on out I get completely lost on how taxes, title fees, and doc fees fit into calculating the adjusted cap cost, which looks like they have calculated to be $39,155.50. Do the bullcrap doc fees, and online processing fees get calculated into the adjusted cap cost or is it just the taxes and incentives?

Is anyone familiar with NJ? From what I've read we get taxed twice - once for the lease and then again for when you purchase the vehicle.

There is a luxury tax that gets added in NJ for any car that is > $45k, so obviously I need to get my vehicle price below $45k to avoid that $180 fee haha. And looks like a bunch of added on fees like $479 doc fee, $10online processing fee, $5 temp tag, $10 trade title fee, etc. that I will hopefully try to avoid by going to another dealer.

Thoughts? Any and all help is appreciated

I just went through the same fight today about the adjusted capital cost. They will try and roll all the fees, taxes, and first lease payment into that cost. I just told them I will pay the fees and first lease payment separate so I know what the buyout price will be, which for me is dealer discounted price - 10,200. I’ll report back on Friday if this worked for me.

 

[stasek]

Hey guys. So I'm from NJ and going to attempt this lease buyout thing, but have some questions specifically about taxes and add on prices after negotiating the price for the car. I went to the dealer today and the math just doesn't add up to me. I will attach a picture of the leasing agreement, so hopefully someone can make heads or tails of it. How does the deal look to you guys?

Looking at buying a 2020 GT1 AWD Cermaic in silver with red interior. MSRP is $49,140. Was only able to negotiate dealer price down to $45,000. I will be shopping around as that doesn't sound like a great markoff from MSRP. They are going to offer me $250 for my beater of a car, and apparently will get another $750 for the trade in via kia as an incentive (is this true because I haven't heard of this offer?). Leash cash incentives this month are $8,600. So total I would be at $9,350 in incentives + $250 for my trade in which comes to a total of $9,600. That would all be subtracted from $45,000. From there on out I get completely lost on how taxes, title fees, and doc fees fit into calculating the adjusted cap cost, which looks like they have calculated to be $39,155.50. Do the bullcrap doc fees, and online processing fees get calculated into the adjusted cap cost or is it just the taxes and incentives?

Is anyone familiar with NJ? From what I've read we get taxed twice - once for the lease and then again for when you purchase the vehicle.

There is a luxury tax that gets added in NJ for any car that is > $45k, so obviously I need to get my vehicle price below $45k to avoid that $180 fee haha. And looks like a bunch of added on fees like $479 doc fee, $10online processing fee, $5 temp tag, $10 trade title fee, etc. that I will hopefully try to avoid by going to another dealer.

Thoughts? Any and all help is appreciated

Looks legit. I highly doubt you'll be able to negotiate all the other fees. Just be glad you're not in south FL, home of the $1K doc fees .
If it were me, I would not put ANY money down, maybe first payment. If you total the car driving off the lot (I know, I know - worst case scenario), you'll be out whatever money you put down.

 

[DBStinger]

So I have been looking around the area in CA for a Stinger GT2 AWD and take advantage of the 10,200 lease incentive that is active here. I got off the phone with a dealer trying to see what the total cost of purchasing out the car a month after leasing would look like and he had stated that if I were to purchase the car less than a year after starting the lease, then I would have to pay back the incentive. Has anyone else heard about this? Is that accurate?

 

[Rob M]

Is anyone familiar with NJ? From what I've read we get taxed twice - once for the lease and then again for when you purchase the vehicle.

In NJ you pay tax up front for the portion of the vehicle you are leasing. If you cancel the lease early by doing the buyout you would need to request a refund from the department of taxation for the portion of the lease you didn't use. Then you pay sales tax on the value of the vehicle when you register as owner. So you are not really being double charged on sales tax since you can get most of the lease taxes refunded. Check out the NJ Consumer Auto Tax Guide (pdf) for details.

 

[Rob M]

So I have been looking around the area in CA for a Stinger GT2 AWD and take advantage of the 10,200 lease incentive that is active here. I got off the phone with a dealer trying to see what the total cost of purchasing out the car a month after leasing would look like and he had stated that if I were to purchase the car less than a year after starting the lease, then I would have to pay back the incentive. Has anyone else heard about this? Is that accurate?

Generally, Stinger lease contracts don't list any such limitations. Not sure whether a dealer would be able to sneak such language into the contract. You just need to be really careful to fully understand everything in the lease contact. If true, it would have to be stated in the agreement.