[pcmike]

Can someone explain what "Capped Fees" are on this deal... I think I'm getting hosed

I went to a local MINI dealer who claimed that they would sell me a 2010 MCS at invoice+$1200. So I sat around and we worked up the configuration I wanted (really what my mom wanted, I'm just doing this for her) and then we took that configuration/MSRP (from miniusa.com) and worked out a lease based on that. I ended up with a copy of the lease agreement that shows all the line items and what not, but what has me concerned is the "Capped Fees" line item which amounts to $1474. I've never read about this line item and I have no idea what its for or what is included in it. I put in a voicemail to the SA and I've yet to hear back. Below you'll find images of the miniusa.com configuration + the lease details. Thanks for the help!

Configuration:

Lease:

 

[pcmike]

The more I look at this dealer's lease details.... the more I think I'm being screwed over to be honest. If you take the MSRP (combined price) from the configuration and then add $150 to it for some sunroof decal (vinyl) my mom wants.. (which the dealer wants $300 to install, but forget that for a minute) you get a MSRP price of $33,567. This dealer's lease lists the Adjusted Cap cost as $33,266. It might as well be freaking MSRP! I really need to know what the hell this $1474 "Capped Fees" are. They essentially nullify any perceived discount I thought we were getting...

Also, should dealer installed options be considered "additional equipment" and not figured into the MSRP of the car? Does that even sound right? By doing that and not figuring it into MSRP its not taken into account in the residual which further makes the deal not that good. I'm really thinking this dealer pulled a fast one on me by claiming invoice+$1200!!

Can someone please give me their take on this?

 

[pcmike]

I've come to the conclusion there is absolutely no savings on any new car lease unless its lease cash, credits of some sort, or the dealer being completely honest and reducing the car. There are just way too many ways for a dealer to high the true cost of the car in a lease. In this instance the dealer discounted the MSRP, but freaking added it back in as a "Capped Fees" line item. This whole experience of leasing two cars now has really soured me on dealers in general. They truly aren't helping you out at all. At the end of the day, you're not getting anything for nothing..... you are paying EXACTLY what they want you to pay; they just call things by different names to deceive you. What a crappy lesson in life.

 

[pcmike]

Based on my realizations here... my new strategy for leasing my next car is going to be this...

1) Goto bmwusa.com and get the MSRP for the car I want
2) Come here and get the MF/residual
3) Plug the above into the lease calculator and get a monthly payment
4) Play with the calculator by adding X amount of down payment money to get the monthly payment to what I want my payment to be
5) Tell the dealer "I want X amount from you towards my down payment (cap cost reduction), if you can't do it.. bye"

This way we're both 100% on the same page. I know exactly what the monthly payment should be and if its not that, obviously the finance guy is just screwing around with the line items and what is above and below the line. It really sucks that I'm just coming to this realization now!! I really got too caught up in all the numbers and didn't see how they relate to each other. I think I see the big picture now and should be well equipped for the next time!

 

[tturedraider]

To answer your initial question the term "capped" refers to capitalized costs, that is costs rolled into the lease payment. Or in the case of making a down payment or getting a rebate it would be a capital reduction which lowers the lease payment.

 

[pcmike]

tturedraider,

I understand all of that. What I don't know is what exactly "Capped Fees" are. All I know is it raises the price back up to MSRP (or within a couple hundred). I understand what capitalized means. Anyhow, I guess the only way I'll find out is by waiting for the SA to call me back and tell me.

 

[krwest1]

The capped fees looks like it includes the acquisition fee. The base fee is $725, but it is probably marked up to $925. That leaves $549 for a dealer doc fee. Is that typical for your area?

Dealer added accessories are usually not residualized, so they greatly increase your lease payment because you are paying for the full amount over term of the lease. Your dealer is calculating them correctly.

From what I can see, they are giving you a $2k discount, which is good for a Mini. However, they have a fairly high doc fee, and are marking up the acq. fee by $200 and possibly marking up the MF, too.

If you got rid of the accessories, and got them to lower/remove the doc fee, you would have a pretty solid deal, IMO.

 

[pcmike]

krwest1,

Gotcha. You'd think they'd put those "fees" into the"Up-Front Fees" line item to be completely transparent. Not factor them into the "deal" and let me pay interest over 3yrs on them! Some of the crap dealer's do really confuses the heck out of me. Especially if we were trading in a car... just let the trade-in cover the stupid fees, don't roll them into the deal.

 

[krwest1]

Some lease worksheets that I've seen have the fees broken out, and some don't. Hopefully the dealer will get back to you and confirm what they are. You can pay the fees upfront or roll them in -- it's just a personal preference. Obviously, the more you pay up front, the lower your payment will be. I personally like to roll in everything possible, especially if the MF is low, and just pay the first payment up front. Yes, you'll pay more interest, but it's minimal in the grand scheme of things, and it leaves the cash free for other uses. Also, if the car is totalled during the lease, you most likely won't get any of the money back that you put down up front.

 

[wmo168]

The capped fees looks like it includes the acquisition fee. The base fee is $725, but it is probably marked up to $925. That leaves $549 for a dealer doc fee. Is that typical for your area?

Dealer added accessories are usually not residualized, so they greatly increase your lease payment because you are paying for the full amount over term of the lease. Your dealer is calculating them correctly.

From what I can see, they are giving you a $2k discount, which is good for a Mini. However, they have a fairly high doc fee, and are marking up the acq. fee by $200 and possibly marking up the MF, too.

If you got rid of the accessories, and got them to lower/remove the doc fee, you would have a pretty solid deal, IMO.

I agree the cap fee is $929 Acq mark up plus Dealer fee which is typical in Florida. Florida charges $500 - $700 in dealer fee. My senses is that they did not give you any discount on the car. They should lower the MSRP on the car from 33000 to actual invoice + $1200, remember, all those add on need to calculate at Invoice price and not MSRP like Sport Package etc...

$33000 for a Mini Cooper S is a lot of money...

 

[pcmike]

The actual costs I figured out (if you add in the $740 addtl equipment and $1200 over invoice) is $33,184. That's only $82 less than what the dealer arrived at. I 100% agree with you that its still too much on a MCS..... but try explaining that to my mom! She wants what she wants, I'm just trying to save her money any way I know how (but at the same time she has to agree with me, for example she still insists on getting the dealer to install certain stupid aftermarket crap).

Thanks guys.

P.S. This post was extremely long and then the forum took a crap on me and wouldn't post it! So above is just a short summary of what I originally wrote.

 

[pcmike]

Alright I think I got everything figured out and maximized. Below you'll find the final deal. Just so you know, I put the $740 (additional equipment+installation) into the "inception cost" on the spreadsheet and rolled it into the payment since the spreadsheet has no way for you to add additional equipment. Also, I used $2400 as the cutoff amount for inception (seems high enough in my opinion!!). So based on $2400 it breaks down as: $504.47 1st payment, $550 security, $320 (registration, again high I think), $800 acq fee (high to me), and $225.53 leftover for dealer fee (still high imo!). The $2400 inception costs are going to be paid form $9500 for trade-in.. leaving $7100 leftover to be given to us in the form of a check. Let me know if you guys thing this is a good deal or not. It amounts to MSRP-$1,948 on a pretty loaded 2010 MCS.

 

[wmo168]

$510 lease a month for 3 years? Why not buy it and save you from Disposition Fee $350.00, Acq Fee $800 and used fees, miles fee $550, those alone will pay for the sales tax on the entire purchase.

You can own the car by doing financing for 60 months at 0.9%

Auto Loan $30670
60 Months @ 0.09%

$512.34 a month

 

[pcmike]

Where are you going to get a 0.9% interest rate on a 2010 MCS?

 

[BWM135]

Where are you going to get a 0.9% interest rate on a 2010 MCS?

From BMW Financial. In October of 2010 .

I think you're a bit too worked up about this, it sounds like you're early in the negotiations, and every other dealer is going to attempt to do some profit taking on an MCS lease. After all, you're ordering a 2010 model, not taking an inventory car that they are in a big hurry to see gone. As said earlier, part of the capped fees is the acquisition fee that's mandated by BMW, the other part is the doc fee that every dealer charges in some form. And as stated the dealer accessories kill you on a lease.

If you're angry about how the lease is structured, just have the dealer break out the stuff you want to pay up front. And make sure the numbers are using the correct residual and that you know the base MF. Minis sell well but they're not in short supply, give the dealer the $1200 over and margin on the accessories and insist on the buy rate MF, base acquisition fee, and waiver of the doc fee. I expect they will agree to that to get the deal done.

I do agree with the idea that you should consider a purchase, especially since you're buying a '10 model. Between the fees, the lack of a compelling lease program early in the model year (which is to be expected), and the fact that Minis tend to hold their value well I'd say the smarter thing to do is buy the car. With good credit you should be able to get financing in the 4-5% range.

Keep us posted on how things are going.

 

[wj94]

$510/month for a Cooper S with $2400 down? That's like a total of $575/month. You can take over my lease on my 09 JCW Mini for $397/month. $500+/month to lease an S is crazy.

 

[pcmike]

Actually it wasn't $575/m.. that would be outrageous with $2400 down. It came out to $488/m with I forget how much down. I'll have to fill you guys in on the details later tonight when I can look at all the paperwork. Also, I'll have to explain my entire experience.. what a freaking day!! The dealer tried to rip us off hardcore and we basically told them to go get f'd and they ended up conceding. Crazy afternoon.

 

[pcmike]

Incase anyone is following this and wants to see the final deal a scan of it is below. Just keep in mind that we ended up getting a Tire/Wheel Warranty as well as a Paint Dent/Scratch warranty for $949. Also, keep in mind the MSRP on the car was $33,000 even.. then my mom insisted on a crap load of dealer accessories (side scuttles, roof decal, mirror caps, some floor mats, some stupid glove box organizer, and probably something else I'm not aware.... plus the dealer painted on some pin striping). Of course all of this crap costed extra and some of it had labor charges associated with it. All that extra crap is figured into this final agree. Just keep all that extra crap in mind when you're assessing whether this deal was good or not. PLUS, keep in mind that I'm probably not going to be allowed back when my dad picks up his car (I kid); the finance guy was pretty pissed off at me. He initially wanted to charge us $1,195 for the acq fee and roll it into the monthly. He also wanted to give us a $1,000 less on our trade-in to "offset" the "discount" I was able to get by shopping around. He essentially want to give us $1,000 and take it. The short of it is that they were not happy with this deal at all!

 

[Newmanium]

Be happy with your deal - but it's generally an act when the dealer pretends to be unhappy with the arrangement. Typically gets exactly the reaction you gave him.

Most dealers won't be clicking their heels together and grinning sheepishly as you sign the paperwork .

As long as you're happy with the deal, that's what matters.

 

[wj94]

$488 per month x 36 months + $3568 paid up front = $21,137
$21,137 / 36 = $587 per month total cost

For that much you might as well just buy the car. Your dealer charges an $818 processing fee? :yikes:

The MSRP on my car was $30,300 and I am paying $397/month for 15k miles per year with $0 down, all taxes and fees rolled into the lease. Only thing due at signing was first month's payment and security deposit. If you're happy with it, good deal....but I think you could do a hell of a lot better.