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Purchasing at the End of Your Lease

Should you purchase or turn it in? What kind of fees can you expect? Here's the place to ask!

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  • My husband leased a 1999 Olds Bravada for 5 years and it is about to end. He was wanting to buy it out. The truck has 60,000 miles and is in good condition. Our lease payments were higher than what they should have been, but we were very upside down in our trade. What do you think we should do?
  • driftracerdriftracer Posts: 2,692
    is what is your lease end value, and what is the thing really worth?


    If you post all of the information in Real World Trade Values, we can get pretty close on wholesale and retail - if your lease end value is more than retail, it's not a good decision to keep it. If it's a good buy compared to real world numbers, then it may be a good choice.
  • Since I moved Theresa's post from Ask the Hosts into this discussion, let's try to get the information here - I hate to shuffle her all over the forums, especially as a new member! (we can ask Terry to make a special guest appearance)

    Need help navigating? - or send a private message by clicking on my name.

  • driftracerdriftracer Posts: 2,692
    if she will drop all the info on the Bravada...
  • stickguystickguy Posts: 13,587
    I look at it this way: at the end of the lease, you need another car, and your off-lease mobile is just another used car (but at least you know the history and how it was treated). So, look at the residual/fees, and determine if you a) want this car, and if so b) what it is worth.


    If it isn't a good deal, find a different car. If the price is right, buy it.


    of course, this assumes you want to own an older car. From what I've seen, many lease people prefer to move right on into a new lease.


    Actually, this raises another point: some manufacturers (I know Honda did at one point) give you a deal if you re-lease (no orig fee or something), just to keep you in the "family".

    2013 Acura RDX (wife's), 2007 Volvo S40 (when daughter lets me see it), 2000 Acura TL (formerly son's, now mine again), and new Jetta SE (son's first new car on his own dime!)

  • There is an informative article on this very subject in the Advice section of Here is a link to it for those of you who are interested: Buying Your Leased Car.




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  • michaellmichaell Posts: 4,300
    I've done this before ... a few (more) questions:


    1) who did you lease through? If GMAC, you might be able to secure pretty good financing terms if you decide to buy. We did that with our '99 New Beetle .. got 5.9% for 36 months, plus they threw in an extended warranty. Can't hurt to ask.


    2) is there any visible damage? you say the truck is in good condition, but when you go to turn it in, that small crease on the drivers door and the cracked windshield and the almost used up tires will count against you. If you buy it, these things don't matter.


    3) if you really, really like the truck, no reason to start over. As mentioned above, you might find some loyalty incentives to stay with GM -- or, alternatively, there might be some "conquest" incentives from another manufacturer.


    Bottom line -- do the research.


    Let us know how it all turns out.
  • I want to purchase my 02Accord which lease is about to end. I decided to work through the dealer from whom I had originally obtained the car. He ran the numbers and after I quizzed him on the monthly payment (which was higher to what I had calculated) it emerged that he had added on $800 to the residual owed to AHFC for "dealer fees" (processing/his time etc--this was in addition to the regular doc fees & licensing and reg fees).If I had not grilled him on his calculations I would never have known about this added charge.Is this normal dealer business practice?. I have decided to work directly with AHFC and obtain financing myself. Is their any risk you are aware of in dealing directly with AHFC to buy out the lease. Thanks
  • Hi steve18. One should always deal directly with the bank that they are leasing through and leave dealers completely out of the equation if they want to purchase their leased vehicle. The bank owns your vehicle, not the dealer. They are the ones that set its selling price. Your dealer, who knows that you are not going to purchase another vehicle from them in the near future because your are purchasing the one that you were leasing, is only going to try to profit somehow from your purchase.




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  • isellhondasisellhondas Issaquah WashingtonPosts: 17,356
    The dealer must pay off AHFC. He would then resell the car to the owner as a used car.


    In order to do that, any smart dealer would do a mechanical inspection to make sure it's in safe condition. If may need brakes, tires etc.


    And, yeah, after doing all of that that dealer may feel the need for some profit.


    Or the leasee can deal directly through AHFC and write them a check which is what almost always happens.
  • Thanks Car_man. I arranged the finance myself with another bank and will send check to AHFC on Tuesday.
  • steine13steine13 Posts: 2,409
    "The dealer must pay off AHFC. He would then resell the car to the owner as a used car."


    Craig, we're all dancing around the real issue here.. which is price. As far as I know -- and from what you've told us -- AHFC does not negotiate buyout prices with their customers. This is really dumb when looking at individual deals, and probably really smart in the big picture, as it keeps their perceived value from sliding downhill like Fords... anyway, they will "deal" with someone in the end, 'cuz the car is worth what it's worth.... an I'm guessing they will deal with their dealers.


    I was thinking really hard about leasing another Vibe, because they have big rebates AND inflated residuals on a good car. The salesman told me that they sometimes negotiate the buyout with GMAC, then add their 'pack' of $300 and resell it to the consumer. This could be a pretty good deal all around, and should work on a Honda as well -- by returning the car, the consumer has fulfilled his obligations, and by buying the car back from the dealer, he doesn't have to buy an unknown quantity.


    But, like I said, the issue is whether the financial institution will negotiate.


    BTW, on the Vibe: I can lease the twin to my '04 5speed for 24 months, and they'll give me a residual of $12k with 24k miles... which is hilarious, cuz a similar '03 would be worth in the $9s today... so yeah, they know it, and they'll deal...


  • You're welcome, steve18.




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  • we're at the end of the lease for my daughter's 2002 Jetta GLS... low miles (29k)... Buy out is $11,900... I can't seem to access Edmunds True Market Value but Kelley's retail is $15,355 and private party $11,070... VW Credit says there isn't any "wiggle room" on price -- that closed end lease is just that... Is this true? If it were $10,500 or they extended the warranty, I'd buy it...
  • isellhondasisellhondas Issaquah WashingtonPosts: 17,356
    This is a lease and you knew what the residual was when you signed up for it. They aren't going to drop the price or give you a warranty.


    By the same token, if the market happened to go sour for whatever reason on Jettas they couldn't ask you for any more money at lease end.


    11,900 is what they figured the wholesale value would be at lease end and they will either sell it to you for that amount or take their chances when the auction it. It could bring more or less than that figure.
  • steine13steine13 Posts: 2,409
    "This is a lease and you knew what the residual was when you signed up for it. They aren't going to drop the price or give you a warranty. "



    We've had this argument off and on... and I think you're wrong on this. SURE they're going to drop the price. If they won't do it for the present customer, they'll do it at auction. And they know it.


    I dunno if VW of A will negotiate, and I DO know that American Honda will not. Plenty of lenders will, and I think there are arguments to be made both ways.


    Maybe I'm misreading you, but you seem to take a fairly high-falutin' approach to this with "you knew what the residual was." You seem to think that someone who wants to buy the car for less does not live up to what was agreed. But that's baloney; the agreement was, so much a month, and give back the car in ok shape.


    After that obligation has been met, why not offer a lower buyout price? Heck, if I know the first owner, I'll likely pay more than the bank will get at the auction... especially because banks don't even do "reserve prices" at the auction, so once it goes, it's gone on the first bid (AFAIK).


    I think offering less is a perfectly honorable thing to do, as is refusing to deal. Honda is shooting themselves in the foot on individual cars, but overall, they are helping to protect their resale value. I respect that, but of course I don't know if it works.


    With all the rebates, I almost leased an '05 Vibe... price would have been $14, residual $12 after 24 months/24k. That's funny, my identical '04 is currently worth less than $11, with 11k miles. In the end, I would have paid more in interest, taxes, and fees than in depreciation, and it just wasn't worth it. But I certainly would have offered to keep the car, and they certainly would have negotiated -- a $2 spread, easily. And yes, GM is killing resale on their cars -- and on MY car, thank you very much -- in a way that Honda isn't.


    With too much time on my hands, I remain,

  • jlawrence01jlawrence01 Posts: 1,828
    "This is a lease and you knew what the residual was when you signed up for it. They aren't going to drop the price or give you a warranty. "


    One of the sales managers comes to me. He has a Chrysler T&C that is coming off lease with a residual of $13.5k. We wants to keep that car BUT does not believe that it is worth that much.


    I posted. Terry told me that the auction price for the vehicle was about $9k.


    He got the car for $10.2k.


    Why shouldn't the leasing company negotiate? If he doesn't buy the car, they'll get maybe $9k less the auction fees and other expenses. Plus, they'll have the vehicle on their books for a minimum of a few weeks tying up their working capital.


    They lost the money a few years back when they overestimated the residual. Just my 0.02.
  • michaellmichaell Posts: 4,300
    I've had first hand experience with them, as we leased a '99 New Beetle in December of '98. After the 4 year lease term was up, we were truly on the fence about buying the car. VW Credit offered to take $500 off the residual value, throw in an extended warranty ($1200 value, IIRC) and finance us at 5.9% for 36 months.


    And, I didn't really ask for any of it!
  • isellhondasisellhondas Issaquah WashingtonPosts: 17,356
    I didn't mean to portray a "high flautin" attitude but I didn't think VW would do that.


    Honda will not and I have to deal sometimes with customers who, for some reason, think they should and get upset when they won't.


    I guess when they get scared after seeing auction results they may decide to concede.


    So much for a set residual I guess?
  • audia8qaudia8q Posts: 3,138
    Don't forget that alot of leasing sources buy residual insurance which makes up any shortfall on the residuals.. If they self insure you might be able to haggle but if they dont self insure they don't have any reason to discount the price.
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