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I'm curious how these numbers are generated? and how they differ from calculations for new car buying? I'm curious to learn about the differences in money flow/costs in leasing from buying(and financing a loan).

 

As some of these guys are urging you to do is call the dealership. See if you can switch that contract from a lease to a buy. Why do I have the inclination that they won't though. But it never hurts to ask. As they've said before, you shouldn't let so much time pass by asking us since we really don't know what the dealer will say. Good luck in any case.

 

That's why you should never rush into things or let the dealer get the upper hand. When you said you were about to walk out on the deal, he knew you weren't because you were too interested in closing a deal so he wouldn't budge.

You got to have all the #s worked out and not let Closer have control of your deals.

 

At this point I'm sure he's fully aware of the fact he shouldn't have done this or that. What's done is done, he's looking to see if he can somehow rectify the situtation.

Call the dealership!

 

Clearly the dealer is in it to maximize profits. They take your lease contract and directly sell it to Infiniti financial within a few days and get paid based on the contract details. For your sale, they're probably selling the contract for well over $8000 since they get a big fraction of the interest profits. It's in the dealer's best short-term interest to not do anything for you, unless it can make them even more money.

Again, it's worth going in to the dealer and voicing that you know that they took advantage of you and give them an opportunity to take care of it before you publish how they took advantage of their customer at every opportunity.

 

The true anuity calculations for leases are very similar to that of buying, with one added complication: the residual of the car. Basically with a lease you effectively take out a loan over a VERY long period (to get the monthly payments down) and then pay off the entire loan at the end of the lease term with the residual value of the vehicle (by giving them back the car or the buy-out cash). It is really no different than buying, other than the effective loan period is over a longer term (so you'll pay more interest in the long run), but this is generally offset by the fact that you only pay sales tax on the portion of the car that you "own" (you pay sales tax on every payment, rather than financing the sales tax on the entire purchase price up-front like with buying).

So the simple way to understand the lease math is as follows:

1) Take the MSRP of the car and multiply by the residual % to get the "value" of the car at the end of the lease term.
2) Calculate the "present value" of this future value using the offered APR (APR = 24 * money factor). The present value of the residual is less than the future value at the lease term, and is basically equal to the amount of money that you would need to invest today at the given APR to result in the residual value at the end of the lease term.
3) Subtract the present value of the residual from the *offered price* of the car (hopefully this is far below MSRP if you've negotiated well). This delta is the amount that you're actually financing to generate your lease payments.
4) Take this delta and do the standard monthly payment calculations used for buying new cars. This will give you your monthly payment minus sales tax.
5) Add in your sales tax to the individual montly payment, and you're done.

Again, a lease is just a loan for purchasing with a fixed balloon payment of the set remaining value of the car at the end of the term. From a financial standpoint, it makes more sense than buying when you can get a better cost of money (lower APR).

 

Something is up with those numbers. Your gross capitalized cost is $36890, but your adjusted cap cost is only $320.37 less at $36569.63. All of your down payment minus the first month's payment and Lojack should have gone in to net cap cost reduction.

What is your "rent charge" listed as in section 5 of your lease agreement? This is effectively how much you're paying in interest over the term of the lease.

 

Rent Charge Is7886.65

 

Yeah, it looks like they gave you the car for the price they stated, but stuck you with about an 8% interest rate.

So perhaps your best bet is to go in there and demand a better rate since you probably qualify assuming your co-signer has great credit.

 

^^^ makes me feel better somewhat lol but yeah my grandma's credit score is P E R F E C T to the T. They even said that her credit score was GOLD! So I don't know whats up?? So did I or did I not get ripped off?? I mean why is the residual value and the amount that I pay all together for the 42 months almost end up at 50gs????

 

Well let's break it down. You effectively paid:

$36890 for the car
$995 for lowjack
$940 in misc fees ($595 bank fee, $45 doc fee, $300 registration fee)
$7887 in interest
$1985 in taxes

= $48697

If you had gotten the previous minimum 5.16% APR, you would have saved about $3000 in interest. You could have also saved about $2000 on the price of the car by negotiating closer to $1k over invoice. So yes, given your grandma's PERFECT credit, you got ripped off. They hid all their profits in the interest rates and virtually MSRP vehicle cost. They straight jacked you for $5000.

 

When I bought my first new car the same freaking thing happened to me, I didn't really read the payoff versus lease carefully, and I realized that I was paying way too much. I remember reading on the contract somewhere that you do have an option to back out of the deal within 72hours, but that could be before you take delivery of the vehicle. Buyers remorse sucks, but you don't want to relive it every time you turn the ignition on. Call the consumers rights in your state, but I think you should try and take it back...literally you could be paying that much to buy the car if you rework that deal...

 

Ring the dealer / contact a lawyer. Just do it, do it now... what's the worse that could happen. Stop pissing around on the forum. Like Nike said just do it.

 

First, what I would do is to get pre-approved form any of the lending company you can find, once you get approved? just "buy-out" your lease, it have nothing to do with the dealership now, if you go back to dealership? they still(might) get you for 10% interest rate, since you got that car for MSRP so you didnt really over paid for the car (per say), what they got you on is the interest rate. And that was the reason when I asked you if your name was on the contract agreement or not, if not? they base the interest rate solely on your Grandmom's credit, since your Grandmom have "gooden" credit, they shuould give her lowest rate possible.

Oh yeah, You DID over paid for the lo-jack!

 

Buying out his lease isn't going to do anything for him. You're bound to the interest payments as a "rental fee". To buy out the lease he would need to just make every payment up front.