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Lease Termination Fees and other costs

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  • dwynnedwynne Posts: 4,018
    It is always cheaper to fix stuff yourself rather than paying the dealer via lease end fees. I would get whatever fixed you know needs doing prior to inspection - like the key. I have not heard or a requirement to have issues fixed by a dealer only, I can't see how they could make you do that.

    Also consider selling your car to a dealer like Carmax or via the autotrader "trade in market place". Also, any BMW dealer or other dealer may like to buy it for their lot. As long as it is not a "turn in" then you don't have to worry about the inspection. The missing key should be replaced soon as every dealer will knock off for that. Compare the current buy out price (without tax) vs the offers you get for your 3. Anything over the buy out goes into your pocket, accept under and it comes out of your pocket. Even then you might be better of to sell at a loss than to pay high lease end fees, if you owe them.
  • kyfdxkyfdx Posts: 28,056
    I've returned two vehicles to BMWFS, and never had an issue... I've always found them to be very lenient...

    MODERATOR
    Prices Paid, Lease Questions, SUVs

  • gastrowgastrow Posts: 1
    My lease on my BMW is up next month and I called the dealer to see about buying the car. They told me I had to speak to BMW finance since "they own the car and we have nothing to do with you buying the car" . Is that correct?? And can you negotiate the residual?
  • lch77lch77 Posts: 53
    It varies between manufacturers.
    I had a Mazda with equity but couldn't sell it to any dealer. The rules came from Ford who owns all or part of Mazda. I understand that Audi also restricts selling of its leased cars.
    However, I just turned in a Subaru and instead of paying a $350 turn in fee plus the cost of a few repairs that were in excess of their allowance, I found a dealer who paid me $650.
    So, first the manufacturer must allow a dealer sale (you can always buy it yourself and then sell it but then you have to pay the sales tax) and the car needs to retail for well over the buyout price.
  • dwynnedwynne Posts: 4,018
    The dealer is correct. If you want to buy at something other than the current buyout price you have to talk to the lease bank. To buy or sell at the buyout price you can use any licensed dealer.

    The way it used to work with BMW - if you turned your car in then BMW would offer it to that dealer before rolling it through the auction. BMW lesees would use this to buy their cars CPO off lease. Turn it in, have it certified, buy it back (paying buyout price, CPO fee, and dealer markup). Normally you would work with the dealership's used car manager on such a deal. Shop around BMW dealers since the amount of markup could vary.

    Other lease banks require the car be auctioned so the turn in dealer doesn't get first dibs on the cars.

    Most lease banks carry residual insurance to cover their turn ins, so there is no incentive to negotiate a lower price with you.
  • Hi, I will be returning my 2010 Rogue AWD this week to the dealership. I'd like to know how much it will cost me to return the car. I know there will be a disposition fee of $400 (I think?) + any charges for excessive wear and use.

    I think my Rogue is relatively in a good condition. The mileage is under 20k and there hasn't been any accidents or repairs. There are some minor scratches on the side, on the bumpers and on the side mirrors. Tires are in a very good condition.

    I was thinking of giving it a good wash and taking it to a shop to recondition it before heading to the dealership for the inspection.

    Any advices for me? And please share your experiences with me regarding this.

    Also, during the last 3 years of lease, I only had 3 oil changes and nothing else. Would that be a problem?

    Thanks!
  • I have leased a car for the first time. Because I could not afford the payments on new.
    The first 100 miles, the ride was very rough. Took it back and they took air out of the tires. But it was still rough ride. I was told it was the tires. So I had to pay a tire dealer, Bridgestone were put on, Still rough but not as bad. It was suggested I put on Michelin, The Michelin felt like there was more rubber on the road. But the ride was still very rough. had the original tires put back Hankook. After going to several dealers. I am told the car was made to ride that way. Hyundai Customer Service said the car is made to ride stiff. I know cars , I restore antiques. Something is wrong with the suspension. Hyundai will do nothing. I am stuck with it until the end of the lease.
    Very uncomfortable car to drive. It now has 6,000 miles.
  • i had a friend that had a issue with his car not a Hyundai
    but if it is the type of tire that are self sealant to help prevent flat tire
    they give you harder ride , he went through several types and finally got Michelin man , when you did test drive did you notice that type of ride
    good luck
  • also i have heard that the tires that are able to run FLAT will give you harder or stiffer ride ,
  • lepialepia Posts: 39
    Hello all,

    I have a 2012 lease. The lease is 15 months old. I only have 9200 miles and the car has no scratches.

    I would like to take advantage of the sign and drive event vw is offering.

    Is it possible to turn in my lease and get into a new one without any penalties, and making the same monthly payments as my current lease?

    Are there any incentives to VW owners and if yes, do these incentives apply to me?

    Let me know what to expect from the dealer and how to negotiate the deal,

    Thanks,
  • sebring95sebring95 Posts: 3,232
    It's pretty simple math. What's the current buy-out on your lease vs the trade-in value. If those numbers are reasonably close you could probably get a deal going.
  • qbrozenqbrozen Posts: 17,226
    At just 15 mos in, it is VERY doubtful you'd be getting into a new one without penalties. But you'd have to go to the dealer to find out.

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '14 Town&Country

  • lepialepia Posts: 39
    Thank you Sebring95 for the reply.

    I just came from the dealer and it didnt turn out as I would liked to.

    It appears the current buy-out was 25K and the trade-in value was 19K.

    I had to come up with almost 6K to turn in the lease.

    I will stick with my current lease and hope that in 24 months vw will come out with another sign and drive event.
  • lepialepia Posts: 39
    You were right qbrozen.

    Thank you for the insight.
  • jipsterjipster Posts: 5,345
    Also, during the last 3 years of lease, I only had 3 oil changes and nothing else. Would that be a problem?

    yes.
  • steverstever YooperlandPosts: 40,209
    A reporter would like to speak to someone who is going to be in the market for a new car in the next few months because their lease is expiring. If you fit this description, please email your daytime contact info to pr@edmunds.com by Friday, January 25, 2013 at noon PT/3 p.m. ET.

    Moderator
    Need help navigating? stever@edmunds.com - or send a private message by clicking on my name.

  • ess_essess_ess Posts: 2
    This is my first post here at Edmunds. I hope this thread is still active.

    I am in a similar position. I leased a 2012 Chevy Cruze LS for 39 months. In the residual column, the finance guy struck out the amount given with the added $2500 fee with a pen, and rewrote the amount for $2500 lesser when I pointed it out to him and said that is wrong. I guess I didn't push him to get a new document with the correct amount printed on. Now, I'm in a condition where I'll be leaving the country and I've to do something about my lease. Turning it in is super expensive as I'll owe every payment due until the end which is about 27 months at 250 apiece minus interest charges.

    I called Ally today for a buyout price and was quoted at the residual(8600) + 2500 + all remaining payments(6500) + "property taxes". The buyout price is greater than the value of the car when I signed the lease(17k + taxes in full because I'm in Texas) . :( The car itself is in great condition with under 7000 miles on it after 12 months lease period is up.

    Does anyone have any experience if this 2500 buyout fee goes away for a dealer buyout? How screwed am I?
  • dwynnedwynne Posts: 4,018
    That $2500 buyout fee is a crime, but you did sign the lease so you may be stuck.

    If you buyout or sell the car to a dealer you should not owe all remaining payments plus residual and fee. A lot of the remaining payments is interest which you wouldn't owe if paid in full now. So residual plus fee plus some remaining principle amount. Property tax may apply where you live, but probably not on a dealer purchase.

    Take your car down to CarMax and see what they will give you for it, then have them contact Ally for a buyout price. Anything more than they offer you will have to be paid to CarMax (in cash or certified funds) to get them to take it off your hands.
  • ess_essess_ess Posts: 2
    Thanks dwynne.

    I'm planning on going down to Carmax and checking out what they will offer this weekend. I'm also exploring the option of a lease transfer and want to keep the selling as a last option in case the lease transfer doesn't go through.

    I have another question, does any dealer take a lease buyout because this will be a sale only? Or only Carmax? Can I go to the dealership I leased the car and check if they will buyout my lease? I'm pretty sure that I'll probably not get a great price for it, but can I check?
  • qbrozenqbrozen Posts: 17,226
    You can take it to anyone you want to buy it from you. You will, however, owe any difference between the buyout and what they are willing to pay for the car.

    Lease transfer may be your least expensive option, even if you have to add cash from your pocket to sweeten the deal.

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '14 Town&Country

  • billy3554billy3554 Posts: 147
    If you were to transfer the lease, the person picking up the lease would likely be stuck with the $2,500 buyout fee. Not likely anyone would be foolish enough to assume that burden.

    With this lease, as described, there is no painless way out. If it were me, I would sell the car, Carmax perhaps, and take out a low interest loan to pay the difference.

    A lease is great for many people provided they understand the terms of the lease. This is an example of why people should never, ever trust an auto salesperson or anyone in the dealership.

    Look at it as a lesson learned and move on.
  • qbrozenqbrozen Posts: 17,226
    But at this point in the lease, he'd probably have to come up with WAY more than $2500 if selling to a dealership. However, if transferring the lease, it may be he only needs to come up with $2500 to hand over the the transferee. So still the cheaper option.

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '14 Town&Country

  • dwynnedwynne Posts: 4,018
    Any dealer can buy your car off lease, Carmax is just set to make the whole process easier.

    I don't think you will find many takers on a transfer - that is assuming Ally allows them and they let you off the hook (some banks hold the original lessee responsible even after a transfer). This is partly due to the fee but your payment is way too high for this car. Someone could get a new lease for less. You will have to offer a large cash incentive to entice someone to take it.
  • dwynnedwynne Posts: 4,018
    2013 Cruze LS w/ Auto Transmission
    Low mileage lease example for qualified non GM owners and lessees.
    $156 per month* for 36 months, includes $500 Auto Show Bonus Cash
    $0 Security Deposit
    $0 Down Payment
    $0 Due at Signing
    $0 First Payment
    Includes all applicable offers.
    (Tax, title, license, dealer fees extra). Residency restrictions apply.

    Chevrolet National Lease Offers

    Low-Mileage Lease for Qualified Lessees
    $199/month 36 month lease.

    $0 due at signing (after all offers). Includes security deposit.
    Tax, title, license, dealer fees and optional equipment extra.
    Mileage charge of $0.25 /mile over 36,000 miles.
  • Hi. I have a 2011 Dodge Durango. Lease terms: 39 months 10K miles/year. My lease is due to end October 2014 so there are 15 remaining payments/months on the lease. My agreement states that buyout can only occur at the end of the lease term-When I will have been deployed to Tokyo for DH's job. In the interim, I am moving from the origination location to a temporary location for about 1 year before we will be deployed. I do not want to take the truck with me as I am positive it will result in excess mileage and wear and tear (mountain terrain vs. flat terrain). I would like to know how the early termintaion charges are calculated? Obviously, I will be responsible for the remaining payments. But what else can I expect to be on my termination fees bill? I leased the truck from the local Dodge dealership and financed through Ally Financial. I do not understand the "surplus" fees associated with the closing of the contract/selling of the vehicle. What are these fees? How are they calculated?
    Please help me detemine if early termination makes sense or if I should continue to drive/lease the truck and cover the expenses at the end of the term (i.e. shipment to new residence, excess wear/tear, excess mileage, and return shipmen to dealership, plus fees associated with giving power of attorney for someone to turn in the lease for me as I will be out of the country). Or if I should cut my losses pay the early termination expenses and buy a new (used) car to use for the next year. Please someone advise. Thanks!!
  • Hey according to new Ally lease documents I see on the 'net. They appear to be official training documents for dealers, it looks like Ally has DROPPED the $2500 purchase option fee that they previously tacked on to the residual value. For some reason they still charge the $2500 on Mitsubishi vehicles, but not on anything else.

    Can anyone who has signed a recent Ally lease deal confirm this?

    Since Ally is no longer (apparently) charging the purchase option fee, are they waiving it on leases signed 2-3 yrs ago?
  • started the other day for october and reduced the 1500 damage waiver to $500:

    http://www.hondafinancialservices.com/leasing/benefits

    "turn-in" fee listed at 350 on contract
  • Hi,

    I was wondering if someone could help explain this situation to me. I leased a 2011 Subaru which has about 9 months left on the lease. I have gone over my miles so I went to a Honda dealership and they paid my remaining payments (around $2K). The Honda dealership then sent my car to a Subaru dealership for me. The salesman called me and said for me to call Chase and let them know where the car was so they could pick it up.... which I did.

    While being on the phone with Chase (the loaner bank), they explained to me that I terminated my lease early so what happens now is that they will pick up the car, and auction it off. If they don't get the value of the car (I believe it is about $12K for the purchase price), then I have to pay the remaining balance.

    Since the Honda dealership paid the remaining payments, wouldn't that mean I fulfilled my legal requirements to pay? What if in the auction, they sell it for $1k? I will $9K (minus the 1k at the auction and the 2k that was given from the honda dealership)??? How do I know they are not scamming me? If someone can xplain this to me, that would be great.... also any advice on what to do would really be helpful Thanks!
  • sebring95sebring95 Posts: 3,232
    edited November 2013
    This is all pretty hard to comprehend without seeing the actual lease document. It sounds like your lease has some sort of open-end clause regarding an early termination.

    Typically when you trade-in a leased vehicle, the dealer buys out the lease. It sounds like this Honda dealer just paid the early termination fee and is now trying to turn the car back to Chase. That would probably work unless there is an open-end clause which requires a fair-value adjustment.

    I would try to work this out with the Honda dealer. If they accepted the terms to take that vehicle on trade they should make it right. The really bad part is that since they didn't keep your car they obviously buried the fee somewhere in your deal. So you paid that $2,000 fee as well.
  • kyfdxkyfdx Posts: 28,056
    The problem is... the Honda dealer did not buy your trade-in from Chase.. they just paid the remaining payments. This is not equivalent.

    The only way to terminate your lease early, is for someone (you or a car dealer) to buy the car from the bank for the payoff amount. The only time you can drop your car off and walk away, is at the end of the lease term.

    I'm sure that the Honda dealer knew your car was not worth the current payoff amount, and suggested this, knowing that you would assume the risk and liability, and not them.

    If it's not too late to unwind this deal (have you taken delivery of the new car?), then that's what I would do... As you note, your liability in this scenario could be large.

    On the plus side, Chase isn't going to "auction" this to a buddy for $1K, and stick you with a giant loss... They are going to send the car to a wholesale auction (like Manheim), where hundreds of dealers will be there to bid on the vehicle, so it should at least bring a fair wholesale value.

    Hope that helps... you aren't the first person to assume you could just pay the rest of your payments and end the lease early.. Good luck!

    kyfdx

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    Prices Paid, Lease Questions, SUVs

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