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Tesla Resale Guarantee Document...

Discussion in 'Model S: Ordering, Production, Delivery' started by fiksegts, May 16, 2013.

  1. fiksegts

    fiksegts Active Member

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    Picked up my 2013 today and did the financing deal just so I could get the guaranteed resale (1.99% for 60 months), not sure if it's been posted yet, so here it is...
     

    Attached Files:

  2. AlMc

    AlMc 'Senior Moments' member

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    Nice. Thanks for sharing.
     
  3. SCW-Greg

    SCW-Greg Active Member

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    Love clear legalese.

    You'll have to let us know how this one compares, in a week or so.
     
  4. AnOutsider

    AnOutsider S532 # XS27

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    Thanks for that, I'd wondered if they would put it in writing.
     
  5. brianman

    brianman Burrito Founder

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    Converting to text so I have it for searching in the future... ;)
     
  6. Cattledog

    Cattledog Active Member

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    fiks - Thanks. I guess I hadn't paid attention to the details previously, or maybe they were not offered, but it's interesting that the value is calc'ed at 50% of the base 60KWh + 43% of the battery upgrade and options.
     
  7. ZBB

    ZBB Emperor

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    The PDF is on Tesla's web site (go to the financing page and there is a link). Just has dummy info for the owner and no vin, but is otherwise the same.
     
  8. Calisun

    Calisun Member

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    I think the clear title provision is a big one. In order to use this resale option you must pay off the remaining loan first. Hopefully there will be exceptions if you roll over to a new Tesla, that might just be enforced for a straight sale.
     
  9. jeffro01

    jeffro01 Active Member

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    I agree on the clear title part. This could be huge for those who financed not because it's "cheap" to do so right now but because they needed to because they lacked the cash flow for an all cash purchase.

    I like the resale guarantee and all but the more I read and see about the "in house" financing the more I'm convinced I'm going with Alliant...

    Jeff
     
  10. Objective1

    Objective1 Member

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    I find it interesting that they state the guarantee in current dollars. I thought they would just provide a formula "the blue-book market value or the highest percentage resale value from a group of class competitors (here specified)." Interesting that they take a flier and use current resale benchmarks to set a firm price now.
     
  11. T-Rati

    T-Rati New Member

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    Thanks for sharing brianman!

    I was originally looking to lease the car, but have slowly been swayed to financing it because of this repurchase guarantee. Do you mind listing out the options that were purchased with your car? You resale value seems slightly lower than what I calculated so I'm trying to figure out what options your value was derived from.

    Thank you much!
     
  12. gmtom1

    gmtom1 Member

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    I'm definitely going to finance mine with Tesla, even though the rate is a bit higher than what I could get with some of the other banks mentioned. My only reason for opting for the Tesla financing is because of the guarantee. Based on what I've read, and as stated in the document, you sell back your car to Tesla between the 36th and 39th month at the guaranteed price. Based on earlier articles, and if you do the math, this amount should be equal to the loan balance outstanding at that point. Thus, I'm pretty sure it will be setup just like a traditional car lease in that you can just turn in the keys anytime between month 36 and 39 and walk away, provided you don't have > 15,000 miles and no major wear and tear or damage. Then you can walk into a new MS, or whatever they have available at that time - which is what I'm planning to do.
     
  13. vfx

    vfx Well-Known Member

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    What if you add accessories? Center console, paint, tow hitch, stereo, Anything shown at TESLIVE.
     
  14. Cutwolf

    Cutwolf Member

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    The clear title is a biggie.

    It seems to be a small subset of people who are going to have financed the vehicle but will also have enough liquid in 3 years to front what could be $50k cash.

    I'd love to see an option where Tesla agrees to buyback your vehicle and send that money directly to the loan company, giving you any leftover, rather than forcing you to front the cash.
     
  15. Colasec

    Colasec Member

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    It is my understanding that the max term on any loan that can be arranged through Tesla Financing (and thus be eligible for the resale) is 60 months. You can't resell until month 36. Even if you put 0% down (which isn't offered through Tesla Financing), you'd still already have paid more than half of what you owe on the vehicle.

    So the resale price will always cover whatever is left on the loan. The financing team confirmed with me that if you choose to sell your car back, Tesla will pay off the remainder of the loan and give you the leftover. Owners don't have to worry about the clear title provision unless they reassign the debt, use the car as collateral for something else, etc.
     
  16. Cutwolf

    Cutwolf Member

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    Where do you see the max term of 60 months? Only thing I can find is http://www.engadget.com/2013/05/03/tesla/ which says 72 months.

    Also, so you confirmed with Tesla that if you owe money on your loan, they will pay off the loan rather than require you to front the cash and then reimburse you? That's pretty significant, if true, and I may take a second look at going through Tesla.
     
  17. Colasec

    Colasec Member

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    Sorry - what I meant was "max term on any loan that can be arranged through Tesla Financing (and thus be eligible for the resale) is 72 months. You can't resell until month 36", since 72/2 = 36 (duh, my apologies).

    My first offer (U.S. Bank) was for 2.8% over 72 months with 23% down. At month 36, the principal balance would be 39% of the sales price of the car.
    My second offer (Wells Fargo) was for 2.95% over 60 months with 19% down. At month 36, the principal balance would be 33%.
    My third (accepted) offer (Wells Fargo) was for 1.99% over 60 months with 48% down. At month 36, my principal balance will be 22%.

    Here is exactly what I received in an email reply from Sean at [email protected] to my question for clarification on the clear title provision:

     
  18. Cutwolf

    Cutwolf Member

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    Very helpful. Thank you so much, Cola.
     
  19. get_amped

    get_amped Member

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    Since I just placed my order and haven't yet discussed financing with Tesla I would like to make sure my understanding of the resale guarantee is correct or not. Please help correct my assumptions where wrong.
    For the sake of this example I will use a 60Kwh car that has a price of $71,070 and $14,300 in options for a total price of $85,370. 50% of $71070 (60 kWh base price) is $35,535 and 43% of $14,300 (options) is $6149. The resale value guaranteed by Tesla on this Model S is $41,684. Tax and registration are paid out of pocket and doesn't come into play, meaning we're not financing them.

    Let's use a term of 72 months and a rate of 2.95%. The first option would be to go go with 15% down ($12,805) and the second option would be 50% down (42,670).

    What would be the credit I end up with after 36 months that I could use toward the purchase of a new Model S?
     
  20. Colasec

    Colasec Member

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    Purchase price*: $85,370.
    Loan start date: 8/15/2013

    Loan 1: 2.95% / 72 months / $72,565 (price - 15%)
    - Your monthly payment is $1,100.91.
    - As of September 2016, you'll have paid $5,045.76 in interest and have a principal balance of $36,877.21.

    Loan 2: 2.95% / 72 months / $42,685 (price - 50%**)
    - Your monthly payment is $647.59.
    - As of September 2016, you'll have paid $2,968.07 in interest and have a principal balance of $21,692.33.

    You get $41,684 for the car. With Loan 1, you get $4,807 back. With Loan 2, you get $19,992 back.

    * In reality this number should include registration, sales tax, and the document & delivery fee.
    ** $42,685 instead of the $42,670 in your question.

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    Remember that if you're comparing these two options, the actual difference is the amount you'll pay in interest vs. the opportunity cost of a larger down payment, not really anything that you might "get back" in the end (since that is directly related to how much you put down).

    Loan 1: pay $2078 more in interest and weather larger monthly payments ($1101), but only have to put 15% down.
    Loan 2: pay $2078 less in interest and have smaller monthly payments ($648), but have to put down 50%.

    ---------

    I used this loan calculator in the above calculations. You might find it helpful.
     

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