JupiterMoon
Well-known member
- Joined
- Dec 11, 2016
- Messages
- 245
wwhitney said:I'm unclear on what you are suggesting. My previous post was comparing two scenarios:JupiterMoon said:Run the numbers....reduce your cap cost by $7500 and see what residual you'd need to be at to equate to 57% at zero cap cost.
1) Current deal, $2,500 Capital Cost Reduction from GM, residual is (say) 60% of MSRP
2) Hypothetical deal, $7,500 Capital Cost Reduction from GM, residual is (say) 60% of MSPR minus $5,000.
I'd prefer deal (2), as I expect to want to buy out the lease. But if you know you want to turn in the car, and you live in California, and your money factor is only 0.0005, then deal (1) is $250 cheaper.
Cheers, Wayne
Wayne,
What I am saying is that even with the tax hit on the cap cost reduction amount, applying the tax credit to the cap cost will result in a lower monthly payment and less rent charge and less tax (even with a lower residual) than were you to not apply that tax credit to the cap cost but increase the residual.
I'm strictly speaking about returning the vehicle.
Run the numbers in the two scenarios and see what you get:
A) 57% residual with no tax credit
B) 47% residual with $7500 tax credit + tax on that credit.
You will pay more per month with (A) than (B).
They are trying to make it look like it's a sweet deal to inflate the residual and con us out of the full tax credit. Not only are they pocketing the tax credit but they are also making even more on increased base payment and rent charge. It's a win win for them not to give us the entire tax credit towards the CC.