Lease Termination Fees and other costs

british_rover

I am confused what is the allowed miles per year on the lease?

How many miles do you have now?

You couldn't have possibly leased the car for 12,000 total miles. No one does leases with that low of a mileage allowance.

You signed a contract to pay them X-number of payments of X-amount so of course they are going to want all their money.

thefineprint

Hi
We are allowed 12000 per year and have driven 38000 in the first 12 months. If they have the car can't it be resold or sold....I dont understand give the car back and make all of the payments. I guess I am not very smart on this whole car lease thing..thanks

tidester

Here's some good background info on leasing: Car leasing advice at Edmunds

tidester, host
SUVs and Smart Shopper

thefineprint

Please dont laugh..seriously, can I not buy out TFS? Do I have to make the next two years in payments to get out of this?? Can I buy the car from the bank instead, or do I have to wait until the end of the lease.

If you buy the car at the end of the lease-no penalties are paid for mileage etc, correct?

tidester

The specific terms should be contained in your contract and you should review them.

Basically, you and the dealer agreed on a price for the vehicle. You also agreed on a residual value. The difference between the price of the vehicle and the residual value is what you are actually paying for in the lease (plus interest, fees, profit, etc.!). You agreed to pay that. Any kind of buyout necessarily includes the cost of the lease plus the residual whether you do it now or at the end of the lease.

If you buy the car at the end of the lease, you will pay the residual plus excess mileage fees.

tidester, host
SUVs and Smart Shopper

thefineprint

Hi
Is it possible to get a loan to cover it all and just buy out TFS?

Do I understand you correctly that even if we buy the vehicle at the end we STILL have to pay mileage fees? Is there ANY way to not get hosed here?

This is depressing.

tidester

Yes, it is possible to buy it out. Again, this will include the cost of the lease plus the residual.

You will still pay mileage fees at the end even if you buy the car at its residual value - unless the lessor chooses to waive the fee or to forgive a portion of it.

tidester, host
SUVs and Smart Shopper

metro123

Can't you trade in a leased vehicle and roll the remaining lease payments into the new lease/loan? (Not that I would do this)

The two most important words in your financial future... GAP INSURANCE !!!

steine13

"You will still pay mileage fees at the end even if you buy the car at its residual value - unless the lessor chooses to waive the fee or to forgive a portion of it."

Everything I have ever read here on Edmunds or elsewhere says that if you buy the car for the residual value, THERE IS NO MILEAGE FEE.

At any rate, the buyout price for any leased car is the residual value + the remainder of the lease payments - the interest portion of remaining payments.

Best is to call them and find out.
If you buy it out, the mileage does not matter.

-Mathias

qbrozen

correct, buying the car means no mileage fees.

But if you are going to buy it out, why do it now?? Then you are just paying extra interest when you don't need to. Finish making the lease payments THEN buy it.

thefineprint

Hi
That is excellent if it is true. I can easily buy the car at the end. It did not make sense to me AT ALL...to have to pay Toyota for depreciation in mileage on a car I am willing to buy at a residual value based on low miles, obviously they are getting abetter deal.

I hope you guys are right. GOing to have some more coffee and call them.

joel0622

If you buy out your lease you do not I repeat you do not have to pay the excess mileage fees.

There are two schools of thought on when to buy it out. One has already been mentioned and that was it is a bad idea to do it now.

The upside of doing it now is that you will have the car payed for faster. Put it on a 5 year note now and you pay it off in 5 years. To do that at lease end you would have to pay out the lease and put the balance on a 3 year not, quite a jump in payments.

Also the banks will give you a better rate because now it is a current year or one year old model with 38K on it. At lease end it will be a 2 to 3 year old car with close to 80K on it and the banks will not be excited about financing it.

Both scenarios mentioned make sense. it is just a matter of what works for you. make sure though that you have gap insurance on it when you buy it because you are going to be way, way, way, way out of equity.

tidester

If you buy out your lease you do not ... have to pay the excess mileage fees.

Correct. I was writing about purchasing but thinking termination.

tidester, host
SUVs and Smart Shopper

joel0622

I figured you were just having a temporary lapse

misica23

Talk to me man, I looked at my lease contract and I think they are full of it! You have more right than they will make you think and I don't think they can force you to auction your car off. Lets talk, friend

Kirstie_H

The decision has likely already been made, given that you're responding to a 3-year-old message

thefineprint

Hi
If you are responding to me....we decided to keep the car until the lease is up and just buy it. Its a great car...and well, I am not paying all of those mileage fees.

Thanks!!

j_ing

My lease ends in December and I have 400 miles to go to reach my 36,000 limit. Do I: a) Turn it in before I go over the limit and pay the $1578 quoted from lender or b) Keep it and pay the $.20/mile for the extra mileage. I will probably be 4000-5000 miles over, so up to $1000 I would owe when I turn it in. I do not want to buy the vehicle.

I appreciate any advice.

Thanks.

qbrozen

How much are the payments?

So $1500 now or $1k in 5 months PLUS 5 more payments, correct?

BUT, you'd have to get another car and start making payments on that. So maybe the payments are a wash. In which case, $1500 now or $1k in 5 months would seem an easy decision, no? You get to drive the car for 5 more months and put off shopping for a new one AND save $500 in the process.

j_ing

My lease payments are $445, so that is $2225 more in payments and the probably $1000 to turn in for excess mileage. I have never turned in a vehicle that I have leased with excess mileage. I am wondering if they will try to find other things to charge me for. I have been researching vehicles on this forum and test driving other vehicles, so I am kind of excited about a new vehicle and don't want to miss out on some of the end-of year model deals. I am very torn on what to do. I appreciate any advice.

Thanks!

qbrozen

well, since it seems they are letting you off the hook for less than your remaining lease payments, and since you are anxious for a new one, I don't see the harm in doing it now.

minivancrazy

Reply
Has anyone ever traded a lease? There are several web sites that will help you take over someones lease prior lease end (Swapalease, leasetrader).

For example, Joe has a 07 car with a lease payment of $350/m with only 6K miles. So I would take over his lease payment and have 30K miles left to use over the next 26 months. At the end of the 26 months I turn it in. In some cases the current leasor will give a cash incentive to take over the lease. If you look hard enough you can find people who put money down for lower lease payment, OR if they got in on a manufacture incentive deal. So in some cases you can get a very good lease payment. In other cases people got ripped off and are paying more for a lease then they should or the lease is already out of miles. It sounds like a way to save money, it your carefull. But I am concerned that it may be too good to be true.

HELP!

caraokee82

I recently terminated the lease of my 2 year agreement for my A4. I called AFS and found out exactly what I needed to do in order to not be charged any additional fees (other than the remaining payments). I bought a Toyota as my 'trade in.' Toyota said that an Audi representative would pick up the A4 from their dealership. The A4 sat on the Toyota lot for about a month (not to my knowledge). Audi never instructed me to have an inspection before terminating my lease. They just sent me an invoice for $1026 for nicks on the tires, and a dent on the door even though the A4 has already been sold at an auction. I signed an agreement with Toyota saying that I was ultimately responsible for my Audi. Audi won't budge on the invoice. Does anyone know of anyway that I can get around paying the fee after I thought I was in the clear after talking to both Toyota and Audi about my responsibilties?

gabby10

I believe in leasing if you like to move out of car every several years , and i have traded 2 times my car into another dealer and got the lease clear , i think what went wrong happen at toyota , why they did not keep that car and sell it on there lot i am not sure the 2 that i did was held and sold at dealer , i walk away from lease i was into another just different car and company , i think i call your attorney general office consumer affairs and ask them but i think the nail to this is toyota having you sign off if they payed audi i say it that dealers car , what happen to audi why did you want out tired of it or mechanical reason just curious ,

volvomax

the Toyota dealer didn't take the Audi in trade.
They just kept the car until Audi picked it up.

volvomax

Well, the Toyota dealer is in the clear because they had nothing to do w/ Audi or Audi financial.
It sounds like you did not trade the Audi in,that the Toyota store just held the Audi for AFS.
Most every lender has some sort of pre term inspection,to guard against what happened to you.
I don't know if Audi does or not,but they should have informed you if they did.
The only thing you can do is call AFS and see if they will cut you a break.
Since you didn't buy a new Audi,they probably don't have any incentive to help you out.

joel0622

Be careful here and make sure you pay the bill. If not the next time you go to finance something you will find out that you have a charged off Auto account in your bureau.

Thats what happens when you don't pay the term fees, they are considered part of the lease account and when they are not paid they are charged off.

andyalzate

I have a 2004 Camry LE lease with 41K miles, ending Oc. 7.

The residual is $9,100.

The Trade-In value is $11,775.
The private party value is $12,800
The Retail value is $14,800

I do not plan to re-lease a new Camry. I'm thinking of leasing a Passat, Volvo S60 or Sabb 9-3.

Should I buy it from Toyota by getting a new loan through Toyota Finance or a bank, and then re-sell or trade in after to get equity?

or
Should I trade-in with Volvo or Passat and use the positive equity to lower my lease payments? Is this common? Will Volvo pay off residual for me?

or

Should I return? I guess if I don't lease from Toyota I lose the equity.

Thanks

gabby10

Hi i have leased over the years and all contracts can be different , but generally you can sell that car if you have a buyer that wants your car and the residual is paid it easy and most times i have had the dealer do the paper work becuase at this point there hoping who evers buys your car will come in for service there and if you trade they will pay it off and if you get more then residual they add that too your down payment , but a word of caution not sure about vw but i had a lease on a audi i was never inform at the time about a $350 payment due at end of lease if i don't get another audi , i thinking 350 and there a good chance i will but my audi was a lemon so that was issue on get out all ok but just keep that in mind i think i know next lease if i ever get crap like that again i just X out and say no way if they insist walk out .

aggieque

any help will be greatly appreciated..

I have a question regarding terminating a lease. I have a '04 BMW 530 that comes off lease in November. I have the option to turn it in or lease/finance the remaining ~$30K. With one more child coming, I am considering moving to 6-8 passenger CUV but the models I am interested in ('08 Highlander Hybrid and '09 Pilot) will be released after my lease ends. Am I torn on refinancing the car when I plan on upgrading to a CUV? Should I refiance or lease when I plan on trading it in sometime in 2008? Any advice? thanks in advance for your assistance.

joel0622

What is an 04 BMW 530 worth?

kyfdx

No matter what it is worth, buying a car when you plan on trading it in a year or less is unlikely to be a wise financial plan. It's possible that the buyout price is a killer deal, but doubtful.

I'd pick something that is out right now... How do you even know that you'll like a model, once it gets here? If you shop around, you might find a good deal on a 24 month lease (BMW X3 comes to mind). That way, you'll only have to wait an extra year for your "dream car".

regards,
kyfdx

joel0622

Or possibly check with the leasing company and ask about extending the lease for a year

rroyce10

Depending on where you live, BMW will carry your lease for another 6/8 months, maybe more. .. call for details.



Terry. :shades:

volvomax

You can trade the car in.
If you buy the car,in mosts states you will pay sales tax on the buyout amount,which will eat into your equity.

The car is prob a $10500-$11,000 car in most areas,so I would take a stab at trading it.
It could at least pay for your front fees on the new lease.

aggieque

latest turn in on lease saga. Long-story short, I test drove several CUVs and am now leaning at keeping the 530. I need opinion if its a smart decision to get my car certified to extend the warranty.

As I previously mentioned, my residual is $31.5 and I have 53K miles on hit. BMW finance has offered 6.99% financing from 2-5 years. In addition, my sales person said they can certify the car for around 2-4K (depends on vehicle conditions, tires, etc.) which will extend the warranty to 100K miles and provide 3.99% financing.

Certifying seems like a good deal especially with the lower rate but the certification costs could exceed the payment savings. For example, $32K loan, 6.99% over 48 months vs. $36K, 3.99% over 48 months- the 3.99% is $1200 more the life of the loan. I think BMW maintenance and service costs over four years or an additional 48K miles should exceed $1200.

Net- does it pay to certify my lease if I plan on keeping it? thanks in advance for the help!

qbrozen

interesting dilemma. It really depends on what they are going to do. $1200 more, yes, but what besides the warranty do you get for that? In other words, what does your car need right now to get certified? Will you get new brakes? Will they change all the fluids? If you get all of that PLUS 47k more miles of warranty for $1200, then I think maybe its worth it.

I think it would be a stretch to expect new tires in that price, though.

im_brentwood

OK...

Post specs on the 530i, we'll see what it's really worth.

Also, re: Certifying the car, where ya located? Find a good independent shop, make sure the brakes are 60%+ and get a fresh set of tires if needed from www.tirerack.com

cennis1

Anyone have any experience with this? My wife leased a civic before we were married, currently has about 6 payments remaining. Car is way under the allowed miles - about 7,000 miles less than would currently be allowed on a pro-rated basis. Same old story, she's now pregnant and both her and I would rather she's in something bigger and safer (she's currently driving my Benz while I commute in the Civic). She likes the Pilot (I really don't like SUVs, but find the Pilot less objectionable than most) and we would, without any haggling, sign up for the national deal through AHFC for an 08 Pilot for $309/month with $3,000 down. Her current lease is also through AHFC and we both have excellent credit and income. Anyone with experience on something like this? While I would be fine paying the typical $300ish "lease termination" fee I would otherwise want to walk away clean. Otherwise I keep driving the Civic for the next 6 months and we make them work a little harder to make the sale at that point.

Thanks.

joel0622

What is the payment? Worse case scenario is you pay the 6 payments and turn it in. Best case scenario it is worth more then you owe and you have equity.

cennis1

Perhaps I didn't articulate the question. I understand the concept of equity, as well as the question of is the car worth more than the current buyout. But I don't need to do this, and am certainly not going to make any payments on a car that I am turning in and will no longer have (I would just keep the car and have both). I can wait the next six months if need be.

My question is - will AHFC, as a matter of policy, ever let you out of a lease early (and waive any pre-payment penalties) if you are going to sign up for a new lease with them.

Thanks.

qbrozen

will AHFC, as a matter of policy, ever let you out of a lease early (and waive any pre-payment penalties) if you are going to sign up for a new lease with them

No.

But maybe you missed the point of the last poster. The DEALER (not honda finance) may be able to work something out where you pay little to none of the remaining payments due to the value of the vehicle. So you have to work with the dealer, not honda finance. You owe money to honda finance, and that's all they care about. A dealer, on the other hand, would like to sell you a new car and may even want to buy your trade-in.

cennis1

No, I understood his point, but was hoping to avoid haggling with the dealer. Maybe I will give it a quick shot though. I thought (apparently incorrectly) that captive finance companies sometimes will let you out of a lease when you are in the last ~ 6 months if you are going to lease something else with them. But based on what you are saying, those offers are really from the dealerships, not the finance companies.

Thanks for the feeback.

im_brentwood

Unless Honda has a "Pull Ahead" program, the answer is a resounding No.

You have 6 months left. The dealer can either roll 6 payments into your new deal or roll in the difference between lease payoff and the car's trade-in value.

Either way, you are going to pay for those last 6 payments one way or another.

cennis1

I guess that's what I was asking then, does AHFC offer a "pull ahead" program?

KBB seems to say the trade-in is higher than the payoff. Now, I've never had much faith in KBB, but maybe it at least justifies talking to the dealer.

kyfdx

"Either way, you are going to pay for those last 6 payments one way or another."

If his leased car is worth the payoff amount (he did say it had low miles), then the dealer can take it in trade, and he is out nothing...

Doesn't happen often, but is theoretically possible.. I pulled it off, once..

regards,
kyfdx
visiting host

im_brentwood

And I won a lottery scratch-off ticket once... I have seen it happen, some of the first people who leased 96 E320s had equity in them to the tune of $3,500 at lease end. In mid-95, when they first came out, World Omnia had the best program on em.. in the summer/fall of 1998, they were coming off lease with $27-28,500 residuals.. and were worth very low 30s as trades with 35k or so on em.

Yes, it could happen. Now, what are the chances? C'mon Captain Bluegrass.. you know better, you been around these parts long enough silly...

And scroll up, I mentioned that it was either pay last 6 payments OR the difference between ACV and payoff

However, door #2 is usually nastier than 6 payments... :surprise:

kyfdx

Two words: Honda Accord ..

im_brentwood

I'll see your Two words and raise you: Captive Finance Company :P

kyfdx

Yeah.. good point..