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Questions on Toyota's Lease & Loan Loyalty program

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  • Feb 17th, 2019 10:01 am
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Questions on Toyota's Lease & Loan Loyalty program

I'm looking at CarCostCanada's report on the Lexus UX and noticed under Incentives, this Lease and Loan Loyalty program:

A 1.5% rate reduction for current Lexus (LFS) or Toyota (TFS) Loan or Lease customers that Finance Purchase or Lease a New Lexus (Dealers contribute 1/3 of the interest cost; that amount should be added to the Invoice Price) - Request the details from your dealer.

Does this mean I have to have an open Toyota or Lexus loan to avail of this 1.5% rate reduction? Or does this apply if had finished paying a loan with Toyota Finance?

What is this 1/3 interest cost? So best not to tell the dealer until you get a final price? I'm not in the market for a new car but just surprised how confusing lexus.ca's UX website is because heated steering wheel and ventilated seats are all standard but the package information are so confusing and contradictory so I had to look them up on CCC.
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alanbrenton wrote:
Feb 16th, 2019 11:14 am
I'm looking at CarCostCanada's report on the Lexus UX and noticed under Incentives, this Lease and Loan Loyalty program:

A 1.5% rate reduction for current Lexus (LFS) or Toyota (TFS) Loan or Lease customers that Finance Purchase or Lease a New Lexus (Dealers contribute 1/3 of the interest cost; that amount should be added to the Invoice Price) - Request the details from your dealer.

Does this mean I have to have an open Toyota or Lexus loan to avail of this 1.5% rate reduction? Or does this apply if had finished paying a loan with Toyota Finance?

What is this 1/3 interest cost? So best not to tell the dealer until you get a final price? I'm not in the market for a new car but just surprised how confusing lexus.ca's UX website is because heated steering wheel and ventilated seats are all standard but the package information are so confusing and contradictory so I had to look them up on CCC.
1.. No direct knowledge for Toyota, but Honda applies Loyalty incentives if a customer has
current loan or completed one less than 1 year ago. My Accord finance contract from 2003-2009
was not counted.

2. "Dealers contribute 1/3 of the interest cost; that amount should be added to the Invoice Price"
This is absolutely not clear without detailed explanation.

In both cases I suggest calling Toyota Finance and get maximum explanation.

Yes, it would be great to get best price without revealing additional
discounts you may qualify for. A salesperson, in general, asks several related
questions upfront , so you give false statement here... and it will be obvious later.

Not my decision.

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alanbrenton wrote:
Feb 16th, 2019 11:14 am
I'm looking at CarCostCanada's report on the Lexus UX and noticed under Incentives, this Lease and Loan Loyalty program:

A 1.5% rate reduction for current Lexus (LFS) or Toyota (TFS) Loan or Lease customers that Finance Purchase or Lease a New Lexus (Dealers contribute 1/3 of the interest cost; that amount should be added to the Invoice Price) - Request the details from your dealer.

Does this mean I have to have an open Toyota or Lexus loan to avail of this 1.5% rate reduction? Or does this apply if had finished paying a loan with Toyota Finance?

What is this 1/3 interest cost? So best not to tell the dealer until you get a final price? I'm not in the market for a new car but just surprised how confusing lexus.ca's UX website is because heated steering wheel and ventilated seats are all standard but the package information are so confusing and contradictory so I had to look them up on CCC.
Here you go:

1. You must have an active lease or finance with Toyota Credit (Lexus-LFS and Toyota-TFS both use Toyota Credit). That being said, exceptions can be requested if you have had an account that was recently closed. I've seen loyalty applied with an account closure of up to 6-months prior. Any exception has to be given the OK by all 3 of the dealer, Toyota Credit, and Toyota/Lexus Canada - this is related to #2.

2. The dealer, Toyota Credit, and Toyota / Lexus Canada split the interest reduction 3 ways. So if the 1.5% loyalty saved you $900 total in interest, the dealer would pay $300, Toyota Credit and Canada would pay $300 each as well, totaling $900. This is an actual cost incurred by the dealership, and the reason CarCostCanada suggests to add it to the invoice. The co-pay cannot be waived or avoided. It also applies to the 1st Payment Free program (1/3, 1/3, 1/3 split).

You can wait to mention it to the dealer until you get the final price, but they will insist you cover the co-pay (rightfully so).
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@xjesterxx I wonder if a Subaru counts, since it's technically by Toyota Credit, right? Face With Tears Of Joy
Toyota Credit Canada Inc. ("TCCI") operates throughout Canada under the business name of "Subaru Financial Services by TCCI". TCCI is the financial services provider of Subaru Canada, Inc.
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xjesterxx wrote:
Feb 16th, 2019 6:35 pm
....

2. The dealer, Toyota Credit, and Toyota / Lexus Canada split the interest reduction 3 ways. So if the 1.5% loyalty saved you $900 total in interest, the dealer would pay $300, Toyota Credit and Canada would pay $300 each as well, totaling $900. This is an actual cost incurred by the dealership, and the reason CarCostCanada suggests to add it to the invoice. The co-pay cannot be waived or avoided. It also applies to the 1st Payment Free program (1/3, 1/3, 1/3 split).

You can wait to mention it to the dealer until you get the final price, but they will insist you cover the co-pay (rightfully so).
I'm confused. If the buyer has to pay for the interest rate reduction, then technically they are not receiving a 1.5% interest rate reduction, as the co-pay that the buyer has to pay increases their overall cost and negates the interest rate reduction.
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skeet50 wrote:
Feb 17th, 2019 8:54 am
I'm confused. If the buyer has to pay for the interest rate reduction, then technically they are not receiving a 1.5% interest rate reduction, as the co-pay that the buyer has to pay increases their overall cost and negates the interest rate reduction.
Depends on your perspective... If you shop and work the deal down to the lowest possible point any dealer will sell for, then spring the loyalty on them as a surprise, it's an unaccounted cost that now has to be accounted for. Similar to working a deal on an in stock unit, figuring out the price, then saying you'd rather have a different color they need to find at another dealer.

It's a rather skewed way to look at it to be honest... If you paid MSRP, or even worked a fair deal, or even mentioned the loyalty promotion ahead of time, or worked an amazing deal with the loyalty on the table, no one is going to ask you to co-pay. My comment was with respect to the scenario where you work the best deal possible, then bring up the loyalty - depending on how aggressive the deal is, you could be asked to pay. If you don't want to, just leave and keep shopping to see if someone else will cover it.
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