High Money Factor Gen2 R1S lease

[GrzPkWD]

Hi all,

I’m taking delivery next week of an R1S dual motor performance. Just got a lease offer for a 36 month lease with 63% residual (great!) and a MF of 0.00327 (terrible!). I’ve got top tier credit and solid income, low debt., etc., so I can’t fathom why the MF would be so high. And the delivery team just says ‘that’s what Chase came up with.’

Am I screwed here? Is this an instance where a large cap cost reduction makes sense to reduce the amount that’s subject to that crazy interest rate?

This has me considering purchasing instead to get a promo 2.99% APR…

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[rivianbuff]

Isn’t that MF equal to a 7.8% interest rate? .00327 x 2400 = 7.8%. If so, sounds reasonable.

 

[ndmiller]

Same reason my saving account is paying 5.25 nowadays...

 

[GrzPkWD]

Yes we’re definitely in (if at the tail end of) a stretch of high interest rates, no argument there. I’m just accustomed to seeing below-market money factors and APRs for car leases / purchases - including Rivian’s offer of 2.9% for a purchase. But I guess there’s enough demand for these cars that it’s wishful thinking to expect that from Rivian?

Another forum user kindly shared a F&F discount with me - with that plus the fed lease credit, and a 63% residual value, the lease is actually not a terrible deal. I’m sure I’ll forget all about it once I pick the R1S up next weekend. ?

 

[jjswan33]

Yes we’re definitely in (if at the tail end of) a stretch of high interest rates, no argument there. I’m just accustomed to seeing below-market money factors and APRs for car leases / purchases - including Rivian’s offer of 2.9% for a purchase. But I guess there’s enough demand for these cars that it’s wishful thinking to expect that from Rivian?

Another forum user kindly shared a F&F discount with me - with that plus the fed lease credit, and a 63% residual value, the lease is actually not a terrible deal. I’m sure I’ll forget all about it once I pick the R1S up next weekend. ?

The solution is to just buy the car in a few months, perhaps with a lower interest rate loan as rates come down. You won't pay the rent charge for the rest of the term. Or course you would lose your ability to trade the car back in at the end.

 

[GrzPkWD]

The solution is to just buy the car in a few months, perhaps with a lower interest rate loan as rates come down. You won't pay the rent charge for the rest of the term. Or course you would lose your ability to trade the car back in at the end.

Interesting, really? I thought that if you purchased mid-lease, you had to pay all remaining rent & depreciation charges? I’ve bought at end of lease several times, but never mid-lease. My hope is to keep the Rivian beyond 3 years - am leasing in part to get the fed lease credit, and to have an easier out in case I (unexpectedly) don’t like the R1S.

 

[jjswan33]

Interesting, really? I thought that if you purchased mid-lease, you had to pay all remaining rent & depreciation charges? I’ve bought at end of lease several times, but never mid-lease. My hope is to keep the Rivian beyond 3 years - am leasing in part to get the fed lease credit, and to have an easier out in case I (unexpectedly) don’t like the R1S.

Depreciation yes, rent charges no. I just did this earlier this year with an Ioniq 5 lease, I confirmed multiple times with the dealership I could do this and they confirmed. My pay off was a little murky for the first few months and then it was clear.

There are some small extra fees with a lease as you know, for example the acquisition fee. I've heard legally that if you buy before 3 months it's no longer considered a lease and they might claw back the tax credit portion, as always YMMV.

 

[GrzPkWD]

Depreciation yes, rent charges no. I just did this earlier this year with an Ioniq 5 lease, I confirmed multiple times with the dealership I could do this and they confirmed. My pay off was a little murky for the first few months and then it was clear.

There are some small extra fees with a lease as you know, for example the acquisition fee. I've heard legally that if you buy before 3 months it's no longer considered a lease and they might claw back the tax credit portion, as always YMMV.

Definitely worth looking into, thanks.

 

[CarGuyCarl]

That money factor seems perfectly reasonable.

 

[GrzPkWD]

Ok thanks all, this all helpful context & info.

 

[Electrified Outdoors]

Hi all,

I’m taking delivery next week of an R1S dual motor performance. Just got a lease offer for a 36 month lease with 63% residual (great!) and a MF of 0.00327 (terrible!). I’ve got top tier credit and solid income, low debt., etc., so I can’t fathom why the MF would be so high. And the delivery team just says ‘that’s what Chase came up with.’

Am I screwed here? Is this an instance where a large cap cost reduction makes sense to reduce the amount that’s subject to that crazy interest rate?

This has me considering purchasing instead to get a promo 2.99% APR…

Was yours 10/12/15 for mileage?

I believe Rivian was buying down the MF on Gen1 leases.

63% seems pretty standard for residual and the rate seems inline with market conditions.

Rivian is offering some additional incentives for taking delivery before 9/30 but not a lower MF unfortunately.

Feel free to PM me if I can be of any further help.

 

[dcmackintosh]

Depreciation yes, rent charges no. I just did this earlier this year with an Ioniq 5 lease, I confirmed multiple times with the dealership I could do this and they confirmed. My pay off was a little murky for the first few months and then it was clear.

There are some small extra fees with a lease as you know, for example the acquisition fee. I've heard legally that if you buy before 3 months it's no longer considered a lease and they might claw back the tax credit portion, as always YMMV.

Correct. The cost of the lease is the $895 acquisition fee, and the rent for the first month, plus any additional months that you don't buy out the lease. In our case, the rent is $556/mo. There's no early purchase fee, and you avoid the $495 termination fee. The benefit is the $7,500 lease credit.

 

[cobras.risers]

I just signed my contract but I can’t find the money factor listed explicitly in the contract. Are people just calculating it on their own?

 

[GrzPkWD]

I just signed my contract but I can’t find the money factor listed explicitly in the contract. Are people just calculating it on their own?

I asked my guide… but yes you can plug it into an online lease calculator too.

 

[johnj2803]

I just signed my contract but I can’t find the money factor listed explicitly in the contract. Are people just calculating it on their own?

I asked my guide regarding the money factor.

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