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Lease Termination Fees and other costs

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Comments

  • dwynnedwynne Posts: 4,018
    I would get the current buyout price from Honda Finance (not including taxes) and see if you if you can get a dealer to buy it out for that price (or more). Accords hold value real well and with almost no miles on it (and I assume otherwise in like new shape) there is a good chance you could sell it to a dealer and come out OK.

    Dennis
  • flagg2flagg2 Posts: 5
    OK, here is my scenario.

    I have a 2005 Package #6 Prius on a 48 month lease. The lease is due March 2009. Yes, I know I shouldn’t have leased it but at that time gas wasn’t quite $2 yet.

    The residual value (payoff) is $9750.

    I only have 44,000 miles on it and will be way under the mileage restriction of 15K/year.

    The Blue Book value on this car is around $21000 if selling to a private party.

    Is it possible for me to go ahead and buy it out early from Toyota and then turn around and sell it to a private party?

    I am not planning on getting another Toyota so going to the dealership and working out something for a new Toyota is not an option.
  • sebring95sebring95 Posts: 3,225
    You'll have to go through a dealer either way. Toyota finance won't sell it directly to you....a dealer has to handle the transaction (you buying it from Toyota finance). I don't think it has to be a Toyota dealer, but just a licensed dealer. This may vary from state to state though, so best bet is to call them and find out.

    They can also give you the current buy-out amount...likely your remaining payments + the resisual value. You can then trade it to any dealer for that buy-out amount....it would be handled similar to if you owed money on your trade. I've done two buyouts from Toyota and they're a bit of a pain because you have to use a dealer. Most dealers will charge you a fee for processing the paperwork and some never responded to my inquiries. Good luck, let us know how it turns out.
  • qbrozenqbrozen Posts: 16,886
    7 months early isn't bad.
    Even if your payment is $500/mo, that would make your current buyout around $13k.
    I would post your car and all details on the Real-World Trade-in Values board here on Edmunds and find out what it is truly worth (KBB is garbage).

    '13 Stang GT; '86 Benz 300E; '98 Volvo S70; '12 Leaf; '08 Town&Country

  • dwynnedwynne Posts: 4,018
    The lease bank will only sell to you or a licensed car dealer. In most states you will have to pay tax in order to get the car's title so that you can resell it. This will eat into your profits from trying to flip the car. In some states (CA, for example) you can apply for a tax refund or credit if you resell the car within xx days of buying it. Most other states are not that friendly. If you find a dealer willing to handle the paperwork of the buy and sell for you, you can expect them to charge you several hundred for the time and trouble - you would have to weigh this against the sales tax you would have to pay.

    You may be able to sell it to a car dealership and pocket some money. Not as much as a retail sale but perhaps less hassle on no sales tax to pay. Most dealers would love to have a low mile Prius they could mark way up and sell to some sucker :D . So in any case, get the current lease buy out w/o tax and see where you stand.

    Dennis
  • flagg2flagg2 Posts: 5
    Thanks for the advice everyone. Basically I am just tired of it and I know it is worth a lot more than the residual so I was thinking of upgrading to something else.

    I had to roll negative equity into it when I got it in '05 so I am paying $465/month. I have acclimated to that payment so I figured I could get out of this Prius and into something nice for that.
  • sebring95sebring95 Posts: 3,225
    I would trade in on a Hummer just to blow someone's mind. :P
  • dwynnedwynne Posts: 4,018
    You could get a nice G37 / G37 for that payment. Guzzles the premium at about 18 miles to the gallon around town, but a LOT more fun than the Prius :D .

    If all else fails, try DriversWay or CarMax if they are in your area. They may be able to beat the buyout price and put some money in your pocket. Note that with any dealer "deal" don't mention how much the buyout is - just tell them you simply want them to make you an offer on the Prius and that is none of their business what the buy out price is. Heck, if you have to just tell them you own it free and clear and get the quote - then "remember" there is a buyout on it.

    Dennis
  • volvomaxvolvomax Posts: 5,274
    Your termination fee is that you owe all the money for the lease.
    Including the residual.
    Depending on what your payoff is, you MAY be able to sell the car to a dealer for enough to pay the whole car off.
    Otherwise, you would have to makeup whatever the difference is out of pocket.
  • 1985mb1985mb Posts: 40
    Any experience w/ Volvo Finance lease terminations?

    Considering assuming an XC90 lease; trying to gauge how good/bad they are w/ EWT. 4 months remaining, mileage not an issue, so it's just the lease-end fees and charges that are food for thought
  • 1985mb1985mb Posts: 40
    Why not swap out of the lease? It may be your cheapest option considering you have a relatively in-demand car and relatively reasonable monthly payment. If you had a large SUV with a high monthly payment, you'd be in more trouble but at least with an Accord you have some outs...

    Even if you offer to cover the leasing co's transfer fee (not sure what that is for AHFC) and some upfront cash incentive to the buyer, it may be cheaper and easier than shopping around for a dealer to trader your car in.

    You can advertise your 'deal' on CL for free or at swapalease, leasetrade and leasetrader.com for a small fee
  • dwynnedwynne Posts: 4,018
    Why not swap out of the lease?

    Simple answer: AHFC does not allow lease transfers.

    Dennis
  • bkinpabkinpa Posts: 1
    I am in month 13 of a 36 month 2007 Chevy Suburban lease with a 32,000 mileage cap. Currrently at 20,000 miles. At my this pace, I will end up paying more than $7,000 in over mileage fees when I turn it in.

    Today, I called GMAC and inquired about what options (if any) do I have to soften the mileage blow at the end of my lease. They said I have 23 payments left at $470/month and I would probably owe $7k at lease end for the over mileage. They offered me an offer to terminate the lease today for $5,100! In fact, if I waited a few more months and timed my termination just before the 32,000 mileage mark, the termination fee would be even less and would NOT incur any over-mileage fees.

    Help me with the simple math: 23 remaining payments = $10,810 PLUS another $7,000 in anticipated over mileage charges versus paying $5,100 today and I am walking away from the lease.

    Why would GMAC give up a contractual lease obligation of $10k, plus another $7k to equal $17k AND be burdened with unloading a monster gas guzzler with high mileage versus letting me walk today for $5,100?

    What gives? Sounds like a good deal for me...
  • If you pay $5100 extra today vs. $7000 extra after 23 more payments, then the actual cost of using those extra miles is only $1900 more.... That's only $83/mo..

    $470/mo. sounds cheap for a Suburban... What are you going to replace it with?

    And, though not part of your money calculation, I still have to ask.. Why get a 10,500 mile/yr lease, when you drive 18K mi./yr.?

    regards,
    kyfdx
    visiting host

    Moderator - Prices Paid, Lease Questions, SUVs

  • volvomaxvolvomax Posts: 5,274
    Most VFNA leases include wear ins at no charge.
    So, your only expense should be the $395 disposition fee.
  • bigbutrbigbutr Posts: 111
    We've been out looking at something to replace an 06 Odyssey van when the lease runs out in December. Of course, every place we go offers to make our last three payments if we want to get into their car then. My question is this: Would we get a check to make the final payments, then turn the van back in, provided there were no extra charges for any damages?
    We are well under our mileage (36500 of 46400 allowed) but I don't want to trade it in because the residual is higher than what I think we would get. I'm just a little leery of the "we'll make your final three payments" spiel because I can just see getting a notice from Honda asking where our payments are after doing the deal.
    FWIW, we're looking at a myriad of vehicles: Lexus RX350, Toyota Highlander, Volvo XC90, Acura MDX, Mazda CX-9, VW Tiguan and Buick Enclave. At least, that's the list we've narrowed down to after starting with about 18-20 and eliminating from there.
  • dwynnedwynne Posts: 4,018
    Unless your current ride is worth more than the current buy out price, no dealer is going to "pay your last payments for you". YOU are going to pay them since the dealer will just roll this on top of your new deal.

    You should negotiate the price of your new vehicle first, then worry about payments or lease details. THEN see if you can get the same payment / price and get a dealer to pay your current lease off for you. Odds are good they will not. You can also take your current ride to places like Driver's Way and CarMax to see how much they will pay you for it. Don't tell them how much you owe, the buyout, or how many payment you have left - just get a quote from them and then you compare that to the current buy out price. If they would give you enough to pay off the Ody, just sell it to them and go get something new (if that is what you want).

    If the Ody is not worth the buy out price now, it will not be worth more at the end of lease - so there is no reason to get out of it early (no profit in it). Why not just turn it in at lease end and then get something new? AHFC has one of the best, if not the best, turn in policies in the biz - no fee and $500 per item and $1,500 total in forgiveness for dents, tears, tires, etc - it really is painless.

    Dennis
  • ddog171ddog171 Posts: 2
    I have 9 months left on my H3 lease and am under my miles. I was wanting to buy a smaller car, and was wondering if I went with a GM car would they be willing to work with me on my lease without charging me the early termination fees? Or should I just wait till the end of my lease? What other options do I have?
    Thanks!
  • volvomaxvolvomax Posts: 5,274
    One way or another, your remaining payments will be charged.
    If you can, I would suggest you be patient and wait until your lease is up.
  • a4vya4vy Posts: 9
    I am in major desperation to find the best solution to my problem. I am moving away from the country in October 08 and dont know what to do about my car lease. I leased an Audi A4 last september 07' on a 36 month lease. I still have about 24 months left. Will I end up paying the remaining 24 months even after turning the car in early? Is my best bet using swapalease or leasetraders? How effective and quick are they in getting someone to take over my lease. Would buying the car and trying to sell it to a used car dealership be something I should look into?

    Any suggestions..solutions to help would be highly highly appreciated. :confuse:
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