Leasing at Lawless CDJR
Why Is My Lease Payment Different Than the Advertisement?
One of the most common questions we hear is:
"I saw a lease advertised online. Why is the payment different when I ask for a quote?"
The answer is that every advertised lease is based on a specific set of assumptions. While every dealership advertises differently, understanding what's included-and what's not-can help you make an apples-to-apples comparison.
What Can Affect an Advertised Lease Payment?
Sales Tax and Registration Fees
Many lease advertisements do not include state sales tax or registration fees.
At Lawless Chrysler Jeep Dodge Ram, our lease payments exclude only state sales tax and state registration fees.
Why?
Because we serve customers from both Massachusetts and New Hampshire. Since New Hampshire does not have a state sales tax, including tax in the advertised payment would actually make the payment inaccurate for many of our customers.
All other dealer fees are already included in our advertised lease payments.
Down Payment and Upfront Costs
Many advertised lease payments require a significant amount due at signing.
For example, an advertisement may say:
$299 per month
But the fine print could require $4,995 or more due at signing.
In many cases, that amount isn't just your down payment. It may also include items such as:
- Dealer documentation fees
- Bank (lease acquisition) fees
- First month's payment
- Other upfront costs
Depending on the dealership and lease program, these fees can add $2,000 to $2,500 or moreto the amount you need to bring with you on delivery day.
At Lawless, we take a different approach.
The amount advertised as "Due at Signing" is the amount you put down toward the lease. We include the dealer documentation fee and lease acquisition fee in the lease itself rather than requiring you to pay them upfront. The only additional costs are state sales tax and state registration fees, which vary depending on where you register your vehicle.
Our goal is simple: when you see "$4,995 Due at Signing," that's the amount you should expect to bring-not $4,995 plus another $2,000 in fees discovered later in the process.
Mileage Allowance
Lease advertisements are also based on a specific annual mileage allowance.
Common lease programs include:
- 7,500 miles per year
- 10,000 miles per year
- 12,000 miles per year
- 15,000 miles per year
A lower mileage allowance generally results in a lower monthly payment.
If you drive more miles than your lease allows, you may incur excess mileage charges at the end of your lease, so it's important to choose a mileage plan that fits your driving habits.
Available Rebates
Some advertised lease payments assume you qualify for every available incentive.
Examples may include:
- Military rebates
- Returning lessee (lease loyalty) rebates
- Employee pricing programs
- Other manufacturer-specific incentives
Not every customer qualifies for these programs.
At Lawless, we strive to advertise payments that don't rely on incentives that only a small percentage of customers qualify for. If additional rebates are available to you, we'll gladly apply them to lower your payment even further.
The Advertised Vehicle
Lease advertisements are often based on one specific vehicle in inventory.
In some cases, that vehicle may have fewer options, an uncommon color, or a combination of equipment selected specifically to achieve the lowest possible advertised payment.
That's not necessarily misleading-it's simply how many lease programs are advertised.
At Lawless, every lease advertisement includes the actual stock number of the featured vehicle so you can review its equipment before visiting the dealership. If that vehicle is no longer available, we'll work to locate another similarly equipped vehicle whenever possible.
The Lawless Difference
We believe customers deserve clear, straightforward pricing-not surprises when they arrive at the dealership.
That's why our lease advertisements are designed to tell you exactly what to expect.
Our advertisements include:
- The advertised monthly payment.
- The exact amount due at signing.
- The featured vehicle's stock number.
- Dealer documentation and lease acquisition fees already included in the advertised payment.
- No reliance on rebates that most customers don't qualify for.
- Clear disclosure that only state sales tax and registration fees are additional.
Our goal is simple: to make comparing lease offers easier so you know exactly what you're getting before you visit our dealership.
Still Have Questions?
Lease programs vary based on the vehicle, lease term, annual mileage, and available manufacturer incentives.
If you'd like us to explain one of our lease offers-or compare it to another dealership's advertisement-we're happy to walk through the numbers with you. We believe an informed customer makes the best decision, and we're committed to making the leasing process as transparent and straightforward as possible.
Lease vs. Finance: Which Option Is Right for You?
One of the most common questions we hear at Lawless Chrysler Jeep Dodge Ram is whether it's better to lease or finance a vehicle. The truth is that there isn't a one-size-fits-all answer. The right choice depends on how long you keep your vehicles, how much you drive, and what is most important to you.
Understanding Money Factors and Residual Values
If you've ever leased a vehicle, you've probably heard terms like Residual Value and Money Factor.
While they may sound complicated, these two numbers are what determine almost every lease payment.
Understanding how they work can help you better compare lease offers and understand why some vehicles lease much better than others.
Want to talk auto finance?
What Happens at the End of Your Lease?
As your lease comes to an end, you'll have several options available. The good news is that the process is usually straightforward, and in many cases you don't need to make a decision until the final few months of your lease.
Here's what you can expect:
Step 1: The Leasing Company Will Contact You
Most leasing companies will reach out several months before your lease expires to discuss your options. This gives you time to decide whether you'd like to:
Purchase your current vehicle
Lease or finance a new vehicle
Return your leased vehicle
Explore whether your current vehicle has equity
If you're already thinking about your next vehicle, you don't have to wait for the leasing company to contact you. A dealership can review your options at any time.
Option 1: Purchase Your Vehicle
If you've grown attached to your vehicle, you may choose to buy it.
The purchase price is typically:
Residual Value + Purchase Option Fee
The residual value was established when you signed your lease and represents the predetermined purchase price at the end of the lease.
Some banks also charge a purchase option fee, which is commonly around $500, although it varies by leasing company.
In many cases, purchasing your leased vehicle is handled directly through the leasing company without dealership involvement, although we're always happy to answer questions or assist if needed.
Option 2: Lease or Purchase Another Vehicle
Many customers choose to lease another vehicle when their current lease expires.
Manufacturers frequently offer incentives to encourage returning lease customers, including:
Lease loyalty rebates
Bonus cash for current lessees
Special financing or lease programs
These incentives can often lower the cost of your next vehicle.
In some cases, manufacturers also offer Pull-Ahead Programs, which may waive several remaining lease payments to help customers get into a new vehicle before their current lease officially ends. These programs vary throughout the year and are not always available.
Option 3: Trade Your Vehicle
Many people don't realize that a leased vehicle can sometimes be worth more than its payoff amount.
If your vehicle's market value exceeds the lease payoff, you may have equity.
That equity can often be applied toward:
A new lease
A vehicle purchase
Your down payment on another vehicle
In some cases, customers can trade their leased vehicle several months before the lease ends if sufficient equity exists.
The best way to know is to have your vehicle appraised and compare its current value to the lease payoff.
Option 4: Return the Vehicle
If you simply want to return your leased vehicle, the process is straightforward.
Before returning your vehicle, the leasing company may schedule a lease-end inspection.
The inspection typically evaluates:
Excess mileage
Excessive dents or scratches
Interior damage
Windshield damage
Tire condition
Other wear beyond normal use
Normal wear is expected. The inspection is designed to identify damage or wear that exceeds normal use.
Most leasing companies also charge a disposition (turn-in) fee, which is commonly around $500, although this varies by manufacturer. In many cases, this fee is waived if you lease or purchase another vehicle through the same manufacturer.
Returning Your Vehicle
If you decide to return your lease, simply bring the vehicle to the dealership.
We'll help complete the return process and answer any questions you have.
After the vehicle is officially grounded by the leasing company, you'll typically need to:
Remove your personal belongings.
Cancel your vehicle registration through your state's registry or DMV.
Contact your insurance company to cancel coverage after the registration has been canceled.
Return all keys, owner's manuals, and accessories that came with the vehicle.
Once the leasing company completes its final review, you'll receive a final statement if any charges remain.
These may include:
Excess mileage charges
Excessive wear and tear
Disposition (turn-in) fee
Outstanding property or excise taxes (if applicable)
Any remaining unpaid obligations on the lease
Many customers receive little or no additional charges because they stayed within their mileage allowance and maintained their vehicle throughout the lease.
Not Sure Which Option Is Best?
Every lease situation is different.
Sometimes purchasing your current vehicle makes the most financial sense. Other times, trading early or leasing a new vehicle can provide the greatest value-especially if manufacturer incentives or lease loyalty programs are available.
If your lease is ending within the next six months, stop by Lawless Chrysler Jeep Dodge Ram. We'll review all of your options, determine whether your vehicle has equity, explain any available manufacturer incentives, and help you decide which path is best for your situation-without any obligation.
Want to talk auto finance?
How Is a Lease Payment Calculated?
A lease payment is made up of two primary components:
Depreciation - How much value the vehicle is expected to lose during your lease.
Finance Charge (Money Factor) - The cost of borrowing the bank's money while you lease the vehicle.
After those are calculated, any applicable sales tax is added based on your state's tax laws.
What Is a Residual Value?
The Residual Value is the estimated value of the vehicle at the end of the lease.
The leasing bank establishes this value before the lease begins.
Residual values are usually expressed as a percentage of the vehicle's MSRP-not the negotiated selling price.
For example:
MSRP: $50,000
Residual: 60%
Residual Value: $30,000
This means the bank estimates the vehicle will be worth $30,000 when your lease ends.
One important thing to understand is that the residual value does not change.
Whether:
You negotiate a lower selling price,
Receive dealer discounts,
Put money down,
Or qualify for rebates,
the residual value remains exactly the same.
The only factors that typically affect the residual are:
The specific vehicle and trim level.
The lease term.
The mileage allowance you select at the beginning of the lease.
A lease with 10,000 miles per year will generally have a higher residual than one with 15,000 miles per year because the vehicle is expected to have fewer miles when it's returned.
What Are You Actually Paying For?
Using the example above:
MSRP: $50,000
Residual Value: $30,000
The bank expects the vehicle to lose $20,000 in value during your lease.
That $20,000 is the portion you're primarily paying for.
If you leased the vehicle for 36 months, the depreciation portion of the payment would be approximately:
$20,000 ÷ 36 = $555.56 per month
Before rebates, discounts, finance charges, taxes, and fees are applied.
Dealer discounts and manufacturer rebates reduce the amount being financed, which helps lower your monthly payment.
What Is a Money Factor?
The Money Factor is essentially the interest portion of a lease.
Instead of quoting an Annual Percentage Rate (APR), leasing companies use a much smaller decimal number called a Money Factor.
For example:
Money Factor: .00225
To estimate the equivalent interest rate, simply multiply the Money Factor by 2,400.
.00225 × 2,400 = Approximately 5.4% APR
Just like an interest rate on a traditional loan, a lower Money Factor generally results in a lower monthly payment.
Don't Forget Sales Tax
In Massachusetts, sales tax is paid on the monthly lease payment.
For example:
Monthly lease payment:
$500
Massachusetts sales tax (6.25%):
$31.25
Total monthly payment:
$531.25
Unlike purchasing a vehicle, where sales tax is paid on the purchase price, lease customers generally pay tax as part of each monthly payment.
Why Do Some Vehicles Lease Better Than Others?
One of the biggest misconceptions is that lower-priced vehicles always have lower lease payments.
That's not necessarily true.
Lease payments are heavily influenced by:
Residual Value
Money Factor
Manufacturer lease incentives
Dealer discounts
Available rebates
Sometimes a $60,000 vehicle can actually lease for less than a $45,000 vehicle if:
The bank assigns it a higher residual value.
The manufacturer subsidizes the Money Factor.
Additional lease incentives are available.
That's why lease payments don't always follow MSRP.
A vehicle with stronger manufacturer support can often produce a surprisingly low payment.
The Bottom Line
Every lease is built around the same basic formula:
Vehicle Price
Minus Discounts and Rebates
Minus Residual Value
Plus Finance Charges (Money Factor)
Plus Taxes and Applicable Fees
Understanding these components makes it much easier to compare lease offers and recognize why one vehicle may lease significantly better than another-even if it has a higher sticker price.
If you're comparing multiple lease options, our team is happy to explain exactly how each payment is calculated. We believe the more you understand about leasing, the more confident you'll feel when choosing the vehicle that's right for you.
Ready to begin?
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Lawless Chrysler Dodge Jeep Ram
196 Lexington St
Woburn, MA 01801-4741
- Sales: (781) 376-2500
Stress-Free Car-Shopping
Speaking of new Dodge, Jeep, Chrysler, Ram models, you have your pick of our showroom. Our local dealership keeps a great stock of used cars, trucks, and SUVs in inventory. With competitive prices offered on every pre-owned model for sale on our lot, you won't find a reason to visit any other dealership in Woburn.