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My BIL has a 5-series on lease that comes due next month. I don't think he'll purchase it or lease a new BMW - any gotchas he and my sister should be on the look out for?
At the moment, they are about 1500 miles over allotment, and the car is only driven a few miles a day. So, I've warned my sister that there will be some mileage charges (not sure what the rate is, but I'm figuring .20 a mile).
Anything else? She tells me the car is in good condition.
FAIK, American Honda doesn't currently offer one,but that would be a question for a Honda salesperson.
Pull ahead programs are usually offered by companies that have trouble moving iron(like GM), selling cars is not a problem for Honda.
If the car's clean all he has to worry about is the mileage charges, if he's 1,500 miles over that's 20 or 25c/Mile so that will be deducted from his security deposit... otherwise as long as there's no damage they should be fine.
Tell em to drive the new CTS.. I got to drive one today.. WOW!
Bill
I called Audi and they said I can work out an extension on a month-by-month basis with the dealership. But I'll probably only need 2 weeks. So then I asked: what happens if I just return it late? The response was that I'd be charged a late charge, calculated as the pro-rated lease payment for the number of days it was late. I should 'notify' the dealership that it will be late.
Does anyone know if this is correct? If so, what's the incentive of officially extending a lease, when you can continue to keep it at the same rate on a per-day basis?
Got the wife a 2008 Pilot VP AWD under the national $309/month w/ $3,000 due at signning lease deal. With 57% residual and .00141 MF and a cap cost reduction of $2,000 on Honda's side (essentially giving it to me around invoice) seemed like a pretty fair deal. Again, not much haggling. Easy transaction, and the wife is happy. I've always thought the SUV thing was a bit silly, but it seems like a well-made vehicle and a reasonable value. And the wife is happy.
Thanks for the feedback.
I leased a 2006 VW passat 2.0T back to 2005, it was a 30 months lease and it had 6-7 months end and I'm currently consider whether I should do a early termination because the VW services just sucks and avoid the risk of wear and tears charge from VW as they are pretty tough on this from what I read in this forum
Here is the detail about my lease
2006 VW Passat 25,000/30 months lease, with 6 months left, wheels have some dents (can be fix or get a new set and trade in for the old set) and minor scratch in the front right and rear left (total fixable with about around 200 bucks) no other damage. Currently, I'm on 17000 miles and my guess is that I will be 5K-6K miles under by the end of the lease?
My questions are as follow
1: In the event I'm getting a new set of rim for the car, do I have to report that to VW if I do that before the lease end inspection?
2: Can I get a the minor scratch fix before I have the inspection?
3: Will VW allow early termination if I plan on doing so at around 3 left and let me walk away?
4: Given that my miles usage are under the actual lease term, should I buy out the car and do a trade in?
Thanks all for your help
Alex
Plus, if you do return the car early,those payments have to be made all at once.
If you know there are things you will be dinged for,go ahead and get them fixed before the inspection.
As for tradingt he car,it really depends on what the buyout is vs. what the actual value of the car is.
You do not have to buy the car out to trade it in.
In fact,you shouldn't as you would most likely ahve to pay tax on the buyout amount.
Thanks for your help
So, they are always disclosed.
So, I contacted IFS for payoff instructions. They sent me a letter instructing me to payoff lease from a "financial institution" via cashiers check. Upon receipt of payment, IFS will send the title, bill of sale, and lien release to the "financial institution" who is then supposed to title the car to me.
I contacted 2 banks I do business with, and neither wanted to get involved as they wanted no responsibility to receive and deal with the title. I paid off a lease in CA a few years back with IFS and sent them a cashiers check, and they sent me title directly, not requiring the bank to be the recipient. This whole bank as an intermediary is really screwing things up. My buyer has been more than patient over the last 3 weeks to work with me to make this work, but it seems almost impossible without going to dealer and getting charged all the additional doc fees, taxes, etc.
Does anybody have any recent experience paying off their lease and can you elaborate on what exactly happened? I have called IFS 8 times already and keep getting mixed info.
Please help, I am at my wits end! Thanks in advance.
If you owe the tax,you owe the tax.
If IFS wants you to go thru a dealer,that is waht you have to do.
VFNA operates the same way,lease buyouts are done thru the dealership.
What you could see is if the dealer will just sell the car to your buyer,that way the tax is paid only once.
The dealer doesn't want to sell to 3rd party unless they make a ton of money on it. Ridiculous that they won't help out since I am buying my 3rd car from them!
Thanks!
It is not some weird law in NC it is true of nearly every state in the union for leases.
It is not a use tax. It is a sales tax. I don't think it is fair but two sales amount to two applications of sales tax.
tidester, host
SUVs and Smart Shopper
http://www.ncdot.org/dmv/vehicle_services/registrationtitling/taxHighwayUse.html-
"North Carolina collects a 3% Highway Use Tax on vehicles in lieu of a state sales tax (General Statute 105-187.2). The tax is assessed each time a title is transferred. The maximum tax for commercial vehicles (vehicles with a weight greater than 26,000 pounds) is $1,000.00. All other vehicles are charged 3% with no ceiling.
Money that is collected for the Highway Use Tax goes towards the North Carolina Highway Trust Fund. That money is then used to improve the roads of North Carolina. Additionally, another portion of the money collected for the Highway Use Tax goes towards the State's General Fund."
tidester, host
SUVs and Smart Shopper
I guess the real issue I need to call Infiniti Financial about is the idea that a "financial institution" must send the cashiers check for payoff, and in turn be the recipient of the title. No bank I talked to wants to get involved unless they are going to finance the car.
Last time, I sent a cashiers check, and title was sent directly to me. We shall see...
If people only knew how often banks/finance captives overstated loan balances and lease balances; they would be SHOCKED!!! I actually spoke with a Bank that overstated a friend's lease balance and they actually told me that they use straight line depreciation. I told her that if she used SL depreciation, the lease balance would be considerably less at this point in the lease! According to the lease contract, the actuarial method was to be used to determine the lease amortization rate. Once that's determined, it's used to amortize the lease in much the same way that an installment loan is amortized.
My POINT is BE CAREFUL!!! So, here is some advice for whatever it's worth...
Create a lease amortization schedule. In fact, if you have a mortgage loan or car loan, create a loan amortization schedule as well. They can be easily created in an excel spreadsheet. Need some assistance? I'll be glad to send anyone an excel spreadsheet that computes lease payments and includes a lease amortization template. If interested, email me at diffeq@zoominternet.net. So, why am I doing this? Because I'm a nice guy!
John
Medina, Ohio
Well, you just answered your own question.
Tax is applied each time the title is transferred.
Title would be transferred from IFS to you,so the tax is due.
Doesn't matter that you aren't keeping the car.
Regardless of how they computed it.
Fact is, when you sign a lease contract you promise to pay the bank so many payments at such and such dollars.
It doesn't matter that you end the lease early,the payments are still due.
Yes, some banks do have penalty clauses. Most don't. Unless you are trying to end the lease very early on.
You can create whatever schedule you want,but if you try and tell the bank that they are wrong on their payoff amount,they are just gonna laugh.
Phraseology/terminology differs across fund providers. For instance, some contracts might compute the Upaid Book Depreciation as the unpaid lease balance less the residual value or, alternatively, as the total base payments remaining less the unearned lease finance charge. Either way I need to compute the lease balance or the unearned lease finance charge.
Yes, you're obligated pay the remaining lease payments LESS THE UNEARNED LEASE FINANCE CHARGE... which must be calculated using the method described in the lease contract.
And there are those fund providers that define termination liability charge as the unpaid book depreciation less the surplus (e.g., GMAC) where surplus is just the difference between the wholesale and residual value. If the wholesale is less than the residual, then you have a deficit instead of a surplus.
It would behoove every lessee to maintain a lease amortization schedule or, at least, be able to compute the unpaid lease balance (called adjusted lease balance by some) in the event of early termination.
The bank just doesn't pluck payoff figures out of the thin air. There is some mathematics involved. Why do you think so many lease contracts incorporate such terms as actuarial or constant yield method into their early termination clauses? It's there so that those inclined to do the payoff calculations will be able do so. Afterall, the banks can't collect anymore than what they're legally entitled.
I did tell the bank that they're calculations were wrong and they weren't exactly laughing... at least not over the phone. In fact, they later agreed with my calculations and apologized. If you like, I can show you documentation. If they did laugh at me, I would be asking myself how many other lease balances were overstated? And so now we have a potential lawsuit... hardly a laughing matter no matter what comedy club you're patronizing!
By the way, I also triggered a lawsuit against the largest savings bank in Ohio for mis-amortizing mortgage loans. Now, they're trying to settle a class action lawsuit. If they were laughing, it's doubtful that they're laughing now!
http://ohiosavingsbanklitigation.com/
You don't know me but I happen to be an actuary (FSA) as well as a PhD mathematician and so I usually know what I'm talking about in matters involving financial mathematics and probably more so than the banks do.
Yup, but that is a rather small number in most cases.
Plus, that really only applies if you are TRADING the car in,and the bank is getting the payoff amount.
If you are just ending the lease early,and not paying it off(in other words,the lease company is getting the car back) then you owe the remaining payments,PLUS whatever penalty clause is built into the lease.
I don't care that you think you are some sort of rocket scientist.
What I DO care about is you giving people inaccurate advice,because you THINK things should be a certain way.
Bottom liner is, you aren't in the car business,and you aren't a banker.
FWIW, volvomax does not "sound" foolish at all.... neither does he sound combative.
-Mathias
What you don't know can hurt you. Perhaps a lot of people have been getting ripped off all these years. Pity.
tidester, host
SUVs and Smart Shopper
What I DO care about is you giving people inaccurate advice,because you THINK things should be a certain way.
Bottom liner is, you aren't in the car business,and you aren't a banker.
That was pretty funny
Ahh mann... I missed another great post
I'd share them with you but, you know, it's a privacy thing!
Besides, they had little to do with lease termination fees which, not so coincidentally, is the designated topic here.
( tidester, "Buying a Vehicle with Cash, Check or Credit Card" #118, 1 Oct 2007 5:45 pm )
tidester, host
SUVs and Smart Shopper
Again with the privacy laws. LOL that was great
tidester, host
SUVs and Smart Shopper
Either they pay it or you do.
Typically, the dealer would pay the fees in lieu of discount on the new car.
Although, $4500 is a bunch.
One thing that might mitigate your losses: If you trade your car in now for a new Accord, the dealer will buy the car (take it in trade), and they won't pay sales tax on it... So, your current $16,800 payoff might be less for the dealer... Assume $1000 of that is tax... so, the payoff for the dealer is around $15,800.. If they allow you $13,000 in trade value, your negative equity is only $2800, which might be an easier pill to swallow. It still isn't going to go away.. just easier to take.
(all numbers for illustrative purposes only... no idea what the actual numbers will be, or even if they will be favorable)
Oh yeah.. don't lease the next car.
regards,
kyfdx
visiting host
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Unfortunately, that is becoming the norm for most lenders as well.
tidester, host
SUVs and Smart Shopper
there are basically 2 ways to end a lease early.
Send in a check for the remaining payments or send the car back to the lender. The lender will put the car thru the auction.
Whatever the difference between what the payoff of the whole lease is(payments PLUS residual) and what the car brings at auction comes out of your pocket.
If you truly don't need the car,and don't have the money to turn it in, you could try to sell it or you could try one of those sites that specialize in transferring leases.