"Ford Options" Mach-E Lease vs standard lease - similarities and differences

[Skepteach]

Can I get an update on the current status of Ford Options? I'm starting to work with a dealer who has a RWD Premium standard battery available and they've never done a FO deal. I would like to be prepared for (and corroborate) what they come back to me with on Monday. I'm looking for APRs for 36 and 48 months, and want to make sure the $1k incentive is still in effect.

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[RickMachE]

As long as you purchase the vehicle as it's first owner (not lease) and your 2022 tax liability ("total tax" on your 1040) is greater than $7,500, you'll get that full amount credited to your liability.

I massively reduced my W-4 withholdings during 2021 and now that I'm filing my 2021 taxes, I can see the $7,500 impact to the taxes I still owe.

SInce some are waiting for 2022's to be delivered, and will take a tax credit on 2022's taxes when they file next year, I think the above needs some clarification.

Reducing your W-4 withholdings does not impact the amount of tax credit you are eligible for.
While you can reduce your withholdings (following the process for doing that), you still are responsible for paying enough tax during the year, through withholding, estimated tax, and the car tax credit. If you cut your tax withholding too much, and after the $7,500 credit still owe tax, you may be in for some underpayment penalties.

In short, make sure you know what you're doing.

 

[RickMachE]

Has any MME GTPE owner successfully claimed the $7,500 credit, and what would prevent a credit for a 2021 taken in the 2022 tax year?

The model of Mach-E has no impact on getting the $7,500 federal tax credit.

 

[macchiaz-o]

Reducing your W-4 withholdings does not impact the amount of tax credit you are eligible for.
While you can reduce your withholdings (following the process for doing that), you still are responsible for paying enough tax during the year, through withholding, estimated tax, and the car tax credit. If you cut your tax withholding too much, and after the $7,500 credit still owe tax, you may be in for some underpayment penalties.

True.

Turns out my employer doesn't let me specify a dollar amount that I want them to use to reduce federal withholdings on my bi-weekly paychecks. I don't file a paper W-4 with them, instead it's a weird web site that doesn't look the same as the form.

But they do let me specify a "deductions" amount, which they don't explain at all. So after I purchased the Mach-E (last March), I immediately put in a large-ish figure into my W-4 "deductions" and then monitored my pay stubs to see how it impacted the figures. I observed and adjusted it a few times over the next several paychecks, and then I set it back to $0 once I was confident I'd gotten close enough to the $7,500 credit.

I agree with Rick's warning... This was not easy. If my employer allowed me to just reduce withholdings by a direct dollar amount it would have been more straightforward.

Anyway, I filed taxes a few days ago and ended up owing about $800 in federal taxes so it worked out perfectly for me.

 

[RickMachE]

True.

Turns out my employer doesn't let me specify a dollar amount that I want them to use to reduce federal withholdings on my bi-weekly paychecks. I don't file a paper W-4 with them, instead it's a weird web site that doesn't look the same as the form.

But they do let me specify a "deductions" amount, which they don't explain at all. So after I purchased the Mach-E (last March), I immediately put in a large-ish figure into my W-4 "deductions" and then monitored my pay stubs to see how it impacted the figures. I observed and adjusted it a few times over the next several paychecks, and then I set it back to $0 once I was confident I'd gotten close enough to the $7,500 credit.

I agree with Rick's warning... This was not easy. If my employer allowed me to just reduce withholdings by a direct dollar amount it would have been more straightforward.

Anyway, I filed taxes a few days ago and ended up owing about $800 in federal taxes so it worked out perfectly for me.

It used to be easier. I remember one year I had like 30 withholding allowances, but they don't let you do that anymore.

 

[hybrid2bev]

Can I get an update on the current status of Ford Options? I'm starting to work with a dealer who has a RWD Premium standard battery available and they've never done a FO deal. I would like to be prepared for (and corroborate) what they come back to me with on Monday. I'm looking for APRs for 36 and 48 months, and want to make sure the $1k incentive is still in effect.

Go to the Ford website and pretend to order a new Mach-E like yours. Click on the financing calculator in the upper right. Select Ford Options and your terms.

 

[Skepteach]

Go to the Ford website and pretend to order a new Mach-E like yours. Click on the financing calculator in the upper right. Select Ford Options and your terms.

Thank you! The hang up I think I'm going to run into is that the one I'm considering is a '21, whereas the builder is only including '22s. Does that make a difference in rates and incentives?

 

[Skepteach]

Yeesh, is 5% APR the true APR for Ford Options? Yikes if so! The dealer tells me they're currently offering up to 72 mos @ 2.49% and even 84 @ 3.49%. If FO requires 5% that's nuts, $1k incentive be damned.

But....does Ford Credit still allow early penalty-free payoff? If so, it might be better to choose FO initially, get the $1k incentive, then refi in a couple of months once everything is settled and get a reasonable rate.

 

[RickMachE]

Ford Options, and a regular Ford Credit loan, have no prepayment penalties. You don't need to wait months, or even weeks, you can pay it off or refinance it days later, after pocketing any incentive.

Of course Ford Options gives lower payments than a loan would, if that matters to you.

 

[macchiaz-o]

Yeesh, is 5% APR the true APR for Ford Options? Yikes if so! The dealer tells me they're currently offering up to 72 mos @ 2.49% and even 84 @ 3.49%. If FO requires 5% that's nuts, $1k incentive be damned.

No, that's not the right rate. I think you need to fully build out a Mach-E and put in your zip code when selecting a dealer before bringing up the payment estimator calculator thing. Then you should see the correct values.

But since Ford isn't running the 2021MY build tool anymore, I'm not sure how to go about seeing those rates now.

Your salesperson should be able to look this up for you.

 

[hybrid2bev]

Thank you! The hang up I think I'm going to run into is that the one I'm considering is a '21, whereas the builder is only including '22s. Does that make a difference in rates and incentives?

No the incentives are the same.

 

[Rudy Bega]

No the incentives are the same.

FYI, just closed a Ford Options this week for a GTPE in Michigan. For my zip code got 1.4% for 36 months (I wanted to match warranty) and $1,000 that was applied as a down payment amount. Dealership, Pat Millikan of Redford, had this all ready when I closed. Close took 15 minutes after test drive. Went smooth and silk. ?

 

[hybrid2bev]

Yeesh, is 5% APR the true APR for Ford Options? Yikes if so! The dealer tells me they're currently offering up to 72 mos @ 2.49% and even 84 @ 3.49%. If FO requires 5% that's nuts, $1k incentive be damned.

But....does Ford Credit still allow early penalty-free payoff? If so, it might be better to choose FO initially, get the $1k incentive, then refi in a couple of months once everything is settled and get a reasonable rate.

Ford Options program #21312 best rates for non-GTs are 2.49%, GTs are 1.4%, for 36 and 48 months good through Feb 28th, 2022. The normal financing APR programs for non-GTs are as you described.

 

[Skepteach]

Again, thank you all for the information. I'll be speaking with my salesman today, I just want to be prepared to corroborate the information as this dealership already stated they've never handled a FO financing program and would be at the beginning of the learning curve with it. I went through a similar situation last summer when I bought my first MME, but the dealer was local to me. This one is 8 hours away and in another state so I'm approaching everything a bit more skeptically before I commit to spending a weekend driving.

@hybrid2bev When you have a moment, can you tell me how Ford evaluates best rate tiers? I assume it's by credit score cutoffs.

 

[Rudy Bega]

Again, thank you all for the information. I'll be speaking with my salesman today, I just want to be prepared to corroborate the information as this dealership already stated they've never handled a FO financing program and would be at the beginning of the learning curve with it. I went through a similar situation last summer when I bought my first MME, but the dealer was local to me. This one is 8 hours away and in another state so I'm approaching everything a bit more skeptically before I commit to spending a weekend driving.

@hybrid2bev When you have a moment, can you tell me how Ford evaluates best rate tiers? I assume it's by credit score cutoffs.

My salesman indicated that the threshold was 720, you apply for credit approval and Ford Motor Credit does the check,

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