FAQ

When you sign a lease, the final lease agreement is required by the Federal Consumer Leasing Act to show you an itemized breakdown of the amount due at lease signing or delivery, and a breakdown of how your monthly lease payment is calculated. That agreement will show the various rebates and noncash credits (including the Washington Electric Vehicle Instant Rebate, the federal tax credit, and manufacturer or dealer rebates if applicable) as well as any net value from a vehicle trade-in and additional cash you put down at signing.

This total is then typically used in two ways: to pay for any upfront fees, such as license and registration fees, and primarily as a “capitalized cost reduction” that will reduce your lease price. Dealers should not reduce manufacturer rebates when applying the Washington Electric Vehicle Instant Rebate. When applying for rebate reimbursement, dealers include a copy of the lease agreement, and the program team reviews each claim to ensure all program rules are being followed.

Yes. When dealers complete a lease using the rebate, they submit a claim to the program team with a copy of the lease agreement and other required documents. We have reviewed a number of these lease agreements and dealers are correctly including the rebate as a “capitalized cost reduction”, the same as the federal tax credit, other manufacturer or dealer rebates, or additional cash you might pay up front to reduce the cost of your lease payments.

We are investigating any reports that some dealers may be reducing manufacturer rebates when applying the Washington Electric Vehicle Instant Rebate. Overall, however, dealers are applying the rebate correctly when completing lease agreements.

The Federal Consumer Leasing Act requires that certain lease costs and terms be disclosed to you. Your final lease agreement will include those disclosures and clearly identify how any rebates are being used in the calculation of your lease cost. We strongly encourage dealers to use model disclosure forms such as those available through the Consumer Financial Protection Bureau in providing their estimates. If you have questions on how your estimated lease payment is being calculated, ask your dealer for one of these forms.

There are a number of variables that determine the lease price, including the vehicle trim level, that may impact your estimate. The lease deal available for a particular vehicle may differ from what you see advertised on a manufacturer or dealer website. Per the Federal Consumer Leasing Act, however, you have a right to understand how your specific lease cost is calculated prior to agreeing to lease the vehicle. Your lease estimate should clearly show how the rebate is being applied and you should expect that your dealer is using industry calculators. If a dealer is unwilling to provide you with an estimate that clearly shows the application of the rebate, let us know.

The Federal Consumer Leasing Act requires that certain lease costs and terms are disclosed to you. Your final lease agreement will include those disclosures and clearly identify how any rebates are being used in the calculation of your lease cost. On August 23, 2024 the Washington State Department of Commerce issued a notice to dealers strongly encouraging them to use model disclosure forms such as those available through the Consumer Financial Protection Bureau in providing their estimates. If you have questions on how your estimated lease payment is being calculated, ask for one of these forms. If a dealer is unwilling to provide you with one, please let us know.

We’ve seen income-eligible customers get into affordable EVs across the state because of the Washington Electric Vehicle Instant Rebate, including many with lease deals under $200/month. Not every EV is available for under $200/month, however, so not every customer will get that deal. Each customer’s situation is unique, from their credit score to the value of any trade-in vehicle to the trim levels and options of the vehicle being leased. So how can you get the best deal possible for your unique situation?

1. Ensure all possible rebates are included. The best deals are typically on vehicles that include a combination of the Washington Electric Vehicle Instant Rebate, the federal tax credit (which is applied at the time of lease agreement), and manufacturer incentives. Ask your dealers to show you how these incentives are included in your estimate and in your lease agreement. If a dealer removes or reduces a manufacturer or dealer rebate from what you see advertised online, please contact us.
2. Use online tools to check the estimate. We recognize it can sometimes be hard to reconcile a cost estimate from a dealer with the lease price you were expecting based on initial program announcements or a manufacturer’s advertised deals. Most of the time if your estimate is higher than what you see online, it is because the specific vehicle you are considering is more expensive than the base model used in the online advertisement. Dealers will also add optional fees in estimates for add-ons that you can decline to pay. Use the Edmunds Lease Calculator to estimate your lease payment and see how that compares to the estimate provided by the dealer. Washington Electric Vehicle Instant Rebates can make it easier for you to get into an EV but does not guarantee a set price.

1. Every lease deal starts at the same place as a purchase – with the MSRP (Manufacturer’s Suggested Retail Price). This is usually combined with the freight cost and any add-ons (floor mats, etc.) that come with the vehicle when the dealer buys the car from the automaker. Together, this is the selling price which you can receive from the dealer on the “factory invoice” or “sticker price”.
2. The selling price is then negotiated between the dealer and the customer and becomes the agreed upon value of the vehicle or “gross capitalized cost”. This could include other optional add-ons, like insurance or extended warranties, and any outstanding prior credit or lease balance.
3. The “gross capitalized cost” is then reduced through money you can put down at the time of signing the lease “capitalized cost reduction” (this is money down in excess of state licensing, sales tax, the negotiable documentation fee, and first month’s payment). This includes rebates, discounts, any net allowance from trading in a previous vehicle, and cash that you pay up front. The Washington Electric Vehicle Instant Rebate, federal tax credit, and any advertised manufacturer rebates (if applicable) should be applied at this step.
4. This results in the “adjusted capitalized cost”, which is further reduced by the “residual value”, or the agreed upon value of the vehicle following the lease term. This is the price you can pay to buy the vehicle at the end of your lease term (usually with an additional fee set in the lease agreement), unless this option is not offered by the company leasing you the vehicle.
5. This results in a value that is labeled as the “depreciation and any amortized costs” in federal disclosure forms. This value is then combined with the “rent charge”, similar to the interest on a loan, dependent in part on your credit score. The borrowing interest is referred to as the “money factor” instead of the APR on a car loan. The resulting cost becomes the “total of base monthly payments”.
6. You then divide the total by the number of months in your lease term to get the “base monthly payment”. If the vehicle has a selling price of $45,000 or below, sales tax is exempt on lease payments up to $15,000, including on monthly payments – so the base monthly payment will be your monthly payment amount. If the vehicle is not eligible for the sales tax exemption, or if lease payments exceed $15,000, the monthly payment amount will be the base monthly payment plus sales tax.

Here is an example: