Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!





Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!

Did you get a great deal? Let us know in the Values & Prices Paid section!
Meet your fellow owners in our Owners Clubs

Purchasing at the End of Your Lease

1356720

Comments

  • fennsterfennster Posts: 3
    (from Toronto, Canada) We've come to the end of our lease term and want to buy out our car. I just called the dealer to find out what this would specifically entail. He said a few things that sounded fishy to me, including:

    1. That we need to get our Safety Test done at the dealership. Is this true? I'm pretty sure I heard we can get it certified at any certified auto mechanic (no doubt the cheaper option).

    2. That we have to pay a $500 "administration fee". When I asked what this was about, he said it would be in my contract. We've both examined the contract, and it says nothing about an administration fee anywhere. However, it does mention we will need to pay "official charges" (along with applicable taxes, vehicle license & registration fees and all costs relating to the certification of the vehicle). "Official charges" sounds like a slippery term to me - is this how they're rationalizing their so-called "adminstration fee"? (And if this legitimates the "administration fee", what's to keep them from charging me $5000 or whatever amount they want?!)

    Would really appreciate some honest answers on these matters.

    Thanks!
  • black_tulipblack_tulip Posts: 438
    I am not an expert but why are you calling the dealer? If the car is leased, it is owned by some finance company(where you send your payments to) and those are the guys you should be talking to. The dealer has nothing to do with it.
  • fennsterfennster Posts: 3
    We send our payments to Toyota Credit Canada Inc. But the dealership is claiming this is their own "administration fee".
  • kyfdxkyfdx Posts: 136,583
    Call Toyota Credit Canada... and ask them about buying your car.. They own it, not the dealer...

    I'm not sure how it works in Canada, but in the U.S., the dealer is the last place you want to go to buy out your car...

    regards,
    kyfdx

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

  • Greetings,

    I'm at the end of my lease on a 2000 Mercedes Benz C230 Kompressor. It had 15,000 miles a year. I have 115,000 on it, or 40,000 miles over.

    The residual value is $15,000 and they have offered it to me at $12,800. The car has been keyed by angry residents (I'm a landlord to about 5000 apartments), and is dented and dinged up. To turn it in would be stupid, from what I've read, simply because of the mileage penalties not to mention the damage.

    I want a new car, and will never lease again. It doesn't work for my driving habits. The problem---Mercedes will only offer the $12,800 to me and not a dealer for the buyout. The dealer has to pay the 15K. Further, no bank will finance me--even at $12,800 because of the excess mileage. Mercedes offered to finance me as long as I put $4,000 down and pay 15% interest. I feel like I'm without options. I hate to put 4K into this car. The dealers are offering me around $7K for the car for a trade in, meaning I have to put almost $8,000 (the difference between their offer price and what Mercedes will sell to them) into a new car loan as negative equity.

    While its been good to me, I am now seeing with every repair it is VERY VERY costly. I'm in a quandry---I want a new car, I do about 30,000 miles a year driving to my properties---yet I have an opportunity to not make a mistake again (the first lease).

    Any suggestions? :cry:
  • steine13steine13 Posts: 2,717
    Leasing a car beyond the warranty period, and to 115k miles is not recommended. But that's where we are now...

    I would argue that you "pretty much" got your money's worth out of this thing. 115k is a bunch of miles, even today. And the reason you still owe money on it is the lease thing... but even if you had to fork over another $12,800 and throw the car away, that would not be out of line for 115k of Mercedes Benz driving.

    "(I'm a landlord to about 5000 apartments),"
    Given that, and I'm not trying to be a smart-[non-permissible content removed], shouldn't you be able to come up with some money, your own or borrowed, at better terms than 15%?? From your description, and the miles, it sounds like it'd cost you almost as much to turn the car in as it would to keep it... so keep it and give them the $13. Then you can sell it, or fix it up and sell it. It's a 2000 Mercedes, not a 1996 Dodge Neon.

    Let the fact that it's a lease, and the fact that you'd *like* a new car, detract you from the basics. Buy it out, fix it or not, then sell it or keep it.

    Good luck,
    -Mathias
  • stickguystickguy Posts: 34,239
    buy it, and clean it up as best as you can, then sell it.

    Your math is also a bit fuzzy. I don't see where you come up with "losing" 8,000 on it. If you pay 13K and can get 7K on a trade, it will cost you 6K to buy it and flip it into a trade (plus sales tax if applicable). If you want to be rid of it, figure out how much it will cost you to turn it in (damage penalty + mileage penalty). If it is less than option A, hand them the keys and walk. If not, buy it.

    I would guess you peobably owe 6-8K in mileage alone (at .15-.20/mile), plus who knows how much for damage. So, looks like you should buy.

    Also remember that a dealer doesn't want a hi miles Benz, so you will likely get much more on a private sale. Even if you only got 9K private sale, that's only a 4k loss.

    You might also want to invest in a top notch professional detail before you try to sell it. You would be amazed what a pro can do for a couple hundred bucks.

    Last lease point to remember: You aren't "losing" by paying the mileage overage. You are actually paying for the part of the car you used up (the 40,000 miles) that you neglected to pay for in your monthly payment.

    Finally, the unsolicited personal advice: SOunds like in your line of work, you might want to look into a slightly used basic car that won't attract unwanted attention, and won't cost much to run into the ground. A 1 year old Sonata, Taurus, Impala, etc. would be way cheaper overall, and who really cares if it gets keyed? :)

    2019 Acura TLX A-spec 4 cyl. (mine), and 2013 Acura RDX AWD (wife's)

  • rroyce10rroyce10 Posts: 9,359
    .... **You aren't "losing" by paying the mileage overage. You are actually paying for the part of the car you used up (the 40,000 miles) that you neglected to pay for in your monthly payment** ....



    Bingo ..........................!



    Step back 5 giant steps and look at the "big" picture .... whether it comes out of your left pocket or your right pocket, it comes out of the same pair of jeans .. you play, you pay .....



    Terry.
  • I have a lease on a 2003 Volvo XC90, which is up in February. I am only 200 miles from my 45,000 limit right now. Do I buy it or try to negotiate to lease a new vehicle now, before I get over my miles? What makes the most financial sense? What if I buy it planning to only keep it 2 years? I probably cannot afford a brand new XC90 right now, nor do I know if I really want another one for several more years. My 2003 had problems initially they couldn't figure out, so they replaced its transmission when it was 9 months old. I haven't had any real problems since. But, in another year or so? I have 4 children, so I need a vehicle in this size range.

    Any advice is appreciated.
  • kyfdxkyfdx Posts: 136,583
    At this rate, you'll be about 7000 miles over the limit by February... At $0.20/mile, that is about $1400 in mileage overage charges.. That is probably the cheapest route there is to go, at this late date...

    After that, turn in the Volvo, and go lease a Honda Pilot... Comparable room and amenities.... and, you can probably lease it for 18K mi./yr for $450/mo. with nothing down...

    Just my $0.02...
    kyfdx
    Host-Prices Paid Forums

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

  • I have decided I will probably buy my Volvo XC90 at the end of the lease, which is in February. I have already hit my 45,000 limit, and the mileage will climb at a pretty fast pace. I need to know -what do I need to know???? I will be trying to negotiate on my own, not having ever bought a car on my own before. I read another post which gave advice to contact the leasing co., not the dealership? I would appreciate any advice or guidelines. The residual value listed in the lease agreement is$ 25,244.80.
  • Hi 4mysafekids. The posts that you read that stated to deal directly with the bank that you are leasing through when trying to negotiate your vehicle's lease-end purchase price and not a dealership were absolutely correct. Only the bank that you are leasing through has the authority to negotiate your vehicle's price. Involving a dealer in the process will only cause them to try to find a way to profit on your transaction. Place a call to Volvo Finance, or whatever bank you are leasing your XC90 through a month or two prior to the scheduled end of your lease to see if they will be willing to negotiate your truck's purchase price. If your initial contact there is not willing to work with you, you may be able to get better results by working your way up the ladder to a manager. During your conversation, make sure to give the impression that you are right around your vehicle's mileage limit. If you are way over, the bank might want to get the excess mileage penalty that you will have to pay and if you are way under (which won't be the case anyhow) your vehicle is more desirable for them to take back. There certainly is no guarantee that the bank that you are leasing through will be willing to lower your truck's purchase price. In fact more often than not they won't, but you don't have anything to lose by asking. Good luck and let us know if you have any other questions.

    Car_man
    Host
    Smart Shopper / Prices Paid Forums
  • Hi, and thanks for the reply. I do have more questions on a few things. 1. You stated that I should imply that I am right around my mileage limit because the bank might want to collect a penalty fee. Can they do that if I am buying the vehicle? And still charge me the listed residual price on my original lease? 2. You said that many banks won't negotiate, but it doesn't hurt to try. I really don't get it. Under what circumstances would a bank be willing to negotiate a lower price? Why would they care (what is in it for them) if they sell this car to me or elsewhere? I am going to be way over my mileage, as I am traveling a few hours a coulple days a week. My bike rack fell on the hood, so it has a few really nice dents to go along with all those miles. I have had no real problems with it since they put in a new transmission when it was 6 months old. I need to have a vehicle that can transport 4 kids, and this one has great safety features for all three rows of seating.This safety thing is a priority. Is it worth even trying to negotiate? What am I bringing to the table? If I sound like an idiot, well, this hasn't been a part of my life experience. My ex-husband leased or purchased our vehicles, and we never bought out a lease. But, things change, and now I am wondering, "what the...??!!"
  • You're welcome 4mysafekids. If you are definitely purchasing your leased vehicle you will not have to pay an excess mileage fee, regardless of how many miles over you limit you are. However, the bank that you are leasing through does not know that you definitely want to purchase your leased vehicle, only that you are considering doing so. If they think that there is a chance that you will decide not to purchase your car, and you are way over your mileage limit, there is a chance that they will be less inclined to lower its selling price to entice you to buy it because they will be able to get your excess mileage penalty.

    Some banks will negotiate because they do not want to deal with the expense and hassle of selling your car at auction. Furthermore, many vehicles' lease-end purchase prices are considerably higher than their actual value on the open market. The bank that you are leasing through may be able to lower your car's purchase price some and still take less of a hit than if they had gotten it back. There's no reason for you not to try to negotiate your vehicle's purchase price if you definitely are going to purchase it. If the bank that you are leasing it through won't work with you, you've lost nothing other than perhaps 15 minutes of your time, but if they will you have the potential to save thousands of dollars.

    Car_man
    Host
    Smart Shopper / Prices Paid Forums
  • rroyce10rroyce10 Posts: 9,359
    ...... It's early and I've only had my first cup of coffee ... but lets see if I can make it a little more clear ...

    Lease cars are kinda like rental properties .. the owners don't care much about the condition until the current renters are leaving, then it becomes important ..... in your case, you're "renting" the Volvo until February and it's not going to be important to the bank/lease company until then .. because under the contract, you owe them "X" amount of bucks a month for the rental and "X" amount of bucks at the end to purchase it .......... that said, in February when the rental is up they're going to be lookin' for a new tenant ~or~ off to the auction it will go .. so in January they will be lookin' at the current auction reports and seeing what this puppy might be worth ......

    I think what Car_man is trying to say .. you don't need to tell them you used your bike rack as a chamois and you have a zillion miles on this dude, cuz' then they got ya ...... give them a call in and around 5/6 weeks before the lease is up, make sure you speak with a DM or a Regional lease guy and tell them you have a high level of interest to purchase this unit and what will they'll negotiate as far as price ...... oh yeah - before you do this, drop over to Real World Trade-in Values and I can give you a current value at that time - not now, then .. I'm already backed up .....

    Terry ;)
  • Thanks to Car_man and Terry for helping me get a clue to how it all works. Now, what about this. I had a message on my answering machine TODAY, from the bank, wondering if I knew whether I was planning to turn in or purchase the vehicle (lease not up until mid February). Is this typical to call this soon? Should I try to work with them now, or wait? Will they ask how many miles are on the car? Do I still have your interest to answer more questions?

    Thanks,
    Carolyn
  • rroyce10rroyce10 Posts: 9,359
    ..... **wondering if I knew whether I was planning to turn in or purchase the vehicle (lease not up until mid February). Is this typical to call this soon? Should I try to work with them now, or wait? Will they ask how many miles are on the car? Do I still have your interest to answer more questions?** ....

    It's no biggie .. most lease companies start sniffing around that 3 to 6 month expiration point, it's common ..... just take the dumb blonde attitude and say you'll start thinkin' about any decisions after the Xmas holidays - besides, you have a cake burning and you have to get off the phone .....

    Not knowing what area you live in, any decisions now will be based on "todays" market $$ .. if you wait til' January(ish) the value of the Volvo will probably come down quit a bit because of weather and other issues in the market .... if worse comes to worse, you pay for the extra miles and hand the keys back and get a new vehicle ......

    Terry.
  • gimcgimc Posts: 1
    Hi. I purchased my Toyota Celica in California after a five year lease, during which I paid the lease 'rent' plus tax. When I took the title transfer documents to AAA, I was told that I owed about $800 in 'use tax.' I called the bank [the former lien holder] and was told that this was a sales tax. I'm confused and want to try to get the tax refunded. Why wasn't the sales tax included with the buyout price [ie-why am I paying it after the sale went through]? I'm really upset about the unexpected cost of this buyout. Please help. Thanks very much.
  • Kirstie_HKirstie_H Posts: 11,077
    I don't know California tax law, but it is quite likely that while you were leasing, you paid tax on the portion of the vehicle's value that you rented - so, if this vehicle has a residual value of, say, 45%, you still haven't paid sales tax on that 45% of the vehicle's value.

    Again, I don't know how California works, but here in Missouri, the buyer pays all sales tax at the time he/she registers the vehicle - the dealership has nothing to do with it. Also, it'd be difficult for them to include the sales tax in the buyout price, because generally you know your lease-end buyout price when you sign the lease agreement. Tax rates can change over 5 years, so they couldn't have known what the rate would be today.

    Hopefully someone from CA knows more than I.

    MODERATOR

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

    Share your vehicle reviews

  • isellhondasisellhondas Issaquah WashingtonPosts: 20,225
    You would pay the sales tax on the residual.

    If you would have walked away instead of buying the car you wouldn't have had to pay it.

    I remember when I lived in CA, they referred to sales tax on used cars as "use tax".
  • You're welcome 4mysafekids.

    Car_man
    Host
    Smart Shopper / Prices Paid Forums
  • First time poster. Heres my situation. I leased a 2002 Lexus RX 300 in September of 2002 for 60 mos. I have 50,000 miles on the car with 22 mos left on my lease. I am way over on miles. I estimate I will owe $3,249 on mileage at the end of the lease. Right now I owe $27,147.60 on the buyout. According to some online price guides I will only get about $22,000 for the car if I decided to sell it. That leaves me approx $6,000 in the hole. What is the best way for me to go about doing something, if at all. I really hate the idea of paying the dealership the $3200 but that may actually be the better deal of all those listed. The car is in excellent condition as the mileage is mostly highway and the up keep has been always on time. All replys are greatly appreciated. Nick D
  • qbrozenqbrozen Posts: 26,405
    well, i'm sure, by now, you realize the biggest part of the mistake was leasing for 60 months, so i won't bring that up (oops, too late). ;)

    Ok, first of all, if you are using online pricing guides, then i can tell you that, most likely, you are much further in the hole than you think.

    Which leads to ... 2nd of all, the cheaper option should obviously be the more appealing one. Just wait and roll the miles cost into another vehicle or pay the cash and start over again. If you are driving that much, I suggest not leasing again, or, if you do lease again, certainly DON'T lease for 5 years.

    '10 Equinox LS; '08 Charger R/T Daytona; '67 Coronet R/T; '14 Town&Country Limited; '18 BMW X2. 49-car history and counting!

  • Hello frodnick. My advice is to wait until the scheduled end of your lease to make a decision on what to do with your RX 300. If you purchase your truck from the bank that you are leasing it through then, you will not have to pay it any sort of excess mileage penalty. Furthermore, waiting to purchase your vehicle makes it more likely that the bank that you are leasing it through will be willing to negotiate its purchase prices. There certainly is no guarantee that they will be willing to work with you at lease-end, more often than not banks' won't, but banks are a heck of a lot more likely to negotiate vehicles' prices a month or two before their scheduled termination than they are mid-lease. When you do try to negotiate your truck's price, make sure to give the impression that you are right around your mileage limit. If you are way over it, the bank may want the fat excess mileage penalty that you will owe them.

    If you decide that you do not want to purchase your truck at the end of your lease no matter what, you still might want to consider continuing to make your payments and getting a second, less expensive vehicle to take up some of the mileage that you would have put on your truck.

    Car_man
    Host
    Smart Shopper / Prices Paid Forums
  • My wife has a 2001 Volkswagen Beetle GLS w/sunroof. KBB lists the current trade-in value as around $8800-9500 depending on condition and private party value of 10,200-11,000. It has 42,000 miles out of 60,000 miles possible on the lease. There is no rebate for unused miles. It is in excellent condition other than a single dent/scrap below the drivers door frame (my guess is roughly $500 in damage). Her current plan is to lease a Miata.

    The purchase price is $10294 and there is a $250 'turn-in' fee if she doesn't purchase the vehicle. The wear clause is pretty comprehensive "any and all dents, dings, scratches, chips or rusted areas on any body or trim part".

    My question is this...should we...

    1. Purchase the vehicle and resell it ($850 in tax...ouch).
    2. Try and trade it in to Mazda when we lease the Miata
    or
    3. Turn it back in to Volkswagen and see what they say as far as costs.

    Also, should we just go out and fix the dent? Does it increase the value enough in 1, 2 or 3 to be worth it? I would imagine it definitely would if we were turning it in, but is it always the case?

    Thanks in advance for any input!
  • Hi jriskin. You definitely have a good grasp on how this situation works. The only way to take advantage of your car's good condition and low mileage would be to purchase it from the bank that you are leasing it through and sell it on your own or trade it in. Dealers can often facilitate the trade-in process. In order to determine whether you should purchase your vehicle at the end of your lease, you need to compare its purchase price to its value on the open market at this time. Even though it states your car or truck's purchase option price on your lease contract, you should place a call to the bank that you are leasing it through just to make sure that you have the correct figure. When you do so, it never hurts to try to haggle with them. Some banks will negotiate the lease-end purchase prices of vehicles. If your initial contact at your bank is not willing to lower your vehicle's purchase price, you may have better luck if you work your way up the ladder to a manager. There is a good chance that they will not lower your vehicle's price, more often than not they will not, but you don't have anything to lose by asking.

    As I said earlier, once you know exactly how much money it is going to cost you to buy your leased vehicle you need to compare it to its current value on the open market. You can find out approximately what your vehicle is worth by looking up its Edmunds.com True Market Value in the Used Vehicle Pricing section of this site. You also may want to stop by the following discussion: sysop, "Real-World Trade-In Values" #, 15 Dec 2000 2:07 am. One of our most knowledgeable community members, Terry, frequents that discussion and he is often kind enough to give community members who give him an accurate description of their vehicles with his opinion on their value.

    It is difficult to say whether you will have to pay an excess wear and tear charge for the dent that your car has without seeing it. Most banks will overlook dings and scratches that are literally small enough to be covered over by a credit card, but exact wear and tear guidelines vary from bank to bank.

    Car_man
    Host
    Smart Shopper / Prices Paid Forums
  • qbrozenqbrozen Posts: 26,405
    My guess is, since KBB is usually high, you're looking at an $8K car there, at best. So, if your buyout truly is over $10K, you're best move is to just turn it back in and pay the minor fees.

    '10 Equinox LS; '08 Charger R/T Daytona; '67 Coronet R/T; '14 Town&Country Limited; '18 BMW X2. 49-car history and counting!

  • eel14eel14 Posts: 3
    I currently lease a 2002 Dodge Ram 1500. I am right where I should be on miles and I have 6 months left on the lease. I talked with Chrysler Financial and they said 180 days before lease term, I can talk to them about purchasing the truck without having to take it to a dealer. The residual value is $14,450 at lease end. If I start talking to them now and work a deal to purchase the vehicle would they charge me the residual value + the remaining 6 months of lease payments? Or should I wait until I'm closer to the lease termination date? Thanks in advance for the help!
  • Hi eel14. You are much better off waiting until you are closer to the scheduled end of your lease. Not only will you be on the hook for your remaining lease payments if you try to purchase your truck now, but the bank that you are leasing it through, most likely Chrysler Financial, will be much less likely to work with you on its price this long before your leases's scheduled end. Even though it states your car or truck's purchase option price on your lease contract, you should place a call to the bank that you are leasing it through just to make sure that you have the correct figure. When you do so, it never hurts to try to haggle with them. Some banks will negotiate the lease-end purchase prices of vehicles. If your initial contact at your bank is not willing to lower your vehicle's purchase price, you may have better luck if you work your way up the ladder to a manager. There is a good chance that they will not lower your vehicle's price, more often than not they will not, but you don't have anything to lose by asking.

    Car_man
    Host
    Smart Shopper / Prices Paid Forums
  • sebring95sebring95 Posts: 3,241
    Hello all. I've been having decent luck over the past few years assuming leases. My current Silverado lease is up in a few months and I'm going to buy-it-out/sell it to a relative. So I'm shopping for another assumption. I've had good luck with GMAC residuals being fairly realistic. I'm looking at an '04 F-150 XLT super-crew 4x4 with 23 months remaining. The $20,000 residual seems a tad high so I was curious if anyone has had luck with Ford negotiating the buy-out. I'm normally way-low on the miles as this is an extra vehicle for me. I'm also very skeptical of Fords but that's another story ;)
  • rroyce10rroyce10 Posts: 9,359
    ..... You can negotiate with Fomoco .. but you need to be in and around that 6/8 week window before the lease ends .... right now, in their mind (and the contract) you owe them 23 payments ....

    6/8 weeks when the lease is ending, they will be looking at the auction reports and that current market ...

    Terry.
  • sebring95sebring95 Posts: 3,241
    Thanks, good to know. I passed on this vehicle anyway. Too many bad memories. Now if I can just find another Chevy or Dodge that some poor bloke laid out a bunch of cash on the front end I'll be set.
  • aman74aman74 Posts: 26
    I've got an '01 Sentra SE 2.0 that I leased in late '01 for 4 years. Lease is up on December 25th, I owe one more payment.

    Residual is around 7400. There is a buyout fee of $150. I leased through Nissan Finance. I only have 30,000 miles on it and it is in great shape except a couple scratches. TMV and blue book says the value is 1-2k more than residual, but I don't think an '01 would go for that, although it has the moonroof and alloys etc...

    My questions:

    -Do factory rebates apply to leased vehicles? Nissan is giving 1500 on '06's and 2500 on '05's. One dealer told me no. I want to negotiate the price including rebates and then work out the lease from there.

    -I'm hearing from dealers that there's no 05's around. Should I insist on having a locate done to get more rebate? I get the feeling they just want to move what's on the lot.

    -Nissan is offering this lease currently http://www.nissanusa.com/buying/SpecialOffers/0,,53011,00.html#21111 It looks to be a subsidized lease which is supposed to be good? When they have these offers are they still negotiable?

    -My dealer is offering a "deal" currently where they buy back your lease at 100% of market value and they said they would knock of the last lease payment and any equity in the car above residual would go towards my new deal. I'm leary of anything that ends the lease early and supposedly takes care of old payments. Does this sound legit? What should I watch for? Deal ends Sat. the 12th. Supposedly anyhow.

    -I have contacted Nissan finace with some questions, but for the most part they seem to prefer I deal with the dealership. The car isn't the dealerships at this point. Can't I deal directly with Nissan finance if I decide to purchase my current vehicle?

    -My credit is excellent, but I am currently unemployed so financing without a co-signer will be tough. I can get one if I absolutely have to, but Nissan has already pre-approved me and said I need no co-signer so my incentive to stay with them is strong. I don't have alot of leverage to walk away and seek out a different brand unless anyone knows where to get good financing with tier 1 credit, but no job.

    Sorry this is so lengthy, I don't know where else to get the info. I have done much research, but it's hard to nail down specifics. What is the best time frame to get this deal done? Lease ends in about 6 weeks.

    Thanks to all!

    Anthony
  • aman74aman74 Posts: 26
    Anyone know if they are reputable? I purchased there lease kit. Don't know how reliable it is.

    Peace

    Anthony
  • aman74aman74 Posts: 26
    I wanted to add a question about the before mentioned "deal" letter that was sent to me by my dealership. They claim that becuase they need to fill used car deals and that the Nissan is maintaining record residuals they can make this offer.

    What would be there financial incentive to pay my last payment and give me an amount of money over what the residual is towards my new deal. They are saying that say my residual is 7400 and the market value is 8000 that they will give me the 600 dollar difference towards my next car. At least that's how I understand it from this letter and my call to them.

    My understanding is that they usually take a hit on turn-ins and would want you to purchase. And if they weren't going to take a hit they would be making there money on what the car was worth over residual, but they are saying they will give that to me, which would negate there profit.

    This dealership was pretty honest in my current deal with them, but this sounds a little bit fishy.

    Thanks

    Anthony
  • rroyce10rroyce10 Posts: 9,359
    .. **I've got an '01 Sentra SE 2.0 that I leased in late '01 for 4 years. Lease is up on December 25th, I owe one more payment.
    Residual is around 7400. There is a buyout fee of $150. I leased through Nissan Finance. I only have 30,000 miles on it and it is in great shape except a couple scratches. TMV and blue book says the value is 1-2k more than residual, but I don't think an '01 would go for that, although it has the moonroof and alloys etc...
    ==============================

    Your current lease and what the dealer is offering you are 2 separate entities .... the dealer has nothing to do with your current lease, it's between you and NMAC .. the letters are just to keep you all excited.

    If it's a clean 01 SE with 30k and all the stuff, then the $7,400 residual is very fair and just about wholesale money, most dealers would pay $7,0ish for it on a trade (real money) and probably "ask" $8,9/$9,5 and probably get $8,500ish ....

    I would call NMAC and speak with a lease manager and see if they will maybe negotiate the $7,400 (but don't get into the low miles and how nice it is) even if they come off the price $200 - fine ... if not, it still makes for a nice vehicle without all the risk of an another lease car, plus you get small payments - and you can always sell it down the road for a profit or break even a year or so down the road ....



    Terry.
  • aman74aman74 Posts: 26
    Thanks for taking the time to answer.

    Maybe it was poorly worded, but yeah I know it's a seperate deal, that's why I mentioned that the car is NMAC's and not the dealers.

    NMAC keeps referring me to the dealer.

    I know my posts were kinda long, I just need some more specific answers so I can make a nice deal.

    With the higher interest rates on used and possibly having to have a shorter loan I may be able to get lease payments on a new vehicle for very close to the purchase of my current car. Especially with Nissan's cash back and lease offers. That's why I had all those questions so I can sort this out.

    Like ability to use rebates on leases? And locating an 05 for a bigger rebate? And how legitimate the dealer buyout offer is, etc... etc...

    Thanks

    Anthony
  • aaron_taaron_t Posts: 301
    Leasing last years model is rarely a better deal as residual drops significantly to affect short term payments. I don't think finding a 2005 model will help you unless you were interested in buying it outright.

    If the dealer is giving you $600 towards the next subsidized lease to reduce your payment from $209 or the $790 cap cost reduction and paying your last payment (another $200-ish?), that sounds pretty good to me based on Terry's numbers.

    Or, buying your current vehicle at say $7000 finance for 3 years will give you similar payments to the lease, and you'll own it after that. So, when it's paid off, you'll either have no car payments for a while, or you'll have a vehicle that is still worth $4-5k (assuming still low miles) to purchase the next vehicle.
  • aman74aman74 Posts: 26
    Hi.

    I'm not sure about that 600, that was just an example. They said I would have to bring it in to be looked and they will call Nissan and see what they can do, blah blah. That's why I'm apprehensive, I don't see why they would give me market value, TMV and Blue Book is above the residual.

    Thing about the 05' is that it is an extra 1000 rebate, does that apply to leases as well to reduce the cap? That extra off, plus what I would bargain the car for would make for a mighty low selling price to base the lease off of. But, if that other lease is truly subsidized then it might be hard to beat. Can u wheel and deal on those subsidized leases or do u have to take what they give u numbers wise?

    Thanks to all!
  • aaron_taaron_t Posts: 301
    The 2005 has an extra $1000, but one year older is worth that much less. Also, the money factor is the bigger factor, and I bet the 06 is more incentivized for leasing. As your salesman what a hypothetical 2005 lease would not including your 2001.

    I've only leased 3 vehicles in my life. For two of them, I walked in with my own offers, and the other, I was pleased with the dealer's terms. There is probably still room to give on the Sentra, a slow moving (selling) vehicle.
  • aman74aman74 Posts: 26
    As your salesman what a hypothetical 2005 lease would not including your 2001.

    What do u mean here?

    Thanks

    Anthony
  • aaron_taaron_t Posts: 301
    Sorry, Ii should have been more clear, and there was a typo. Ask, not As.

    Ask your salesman to run the numbers for leasing a 2005 vs. a 2006. The 2006 is right on Nissan's site that you linked, but the 05 is unknown. Leave your 2001 lease/trade out of the equation for now, just to determine which year is a better lease deal.
  • aman74aman74 Posts: 26
    Thanks for the assistance aaron, I appreciate it.

    Anyone have any answers to my questions in my first post?

    This forum seems pretty slow, I was going to try posting in another section, but I didn't know if cross posting was allowed here.

    Car_man are u out there?

    Thanks
  • aman74aman74 Posts: 26
    Car_man?
  • Hi, I hope someone can help me with this question. A friend of mine has leased a full size truck and the lease is up on it in a few months. Her and I have been in a disagreement about trading this truck in. She believes that once the lease is up (or even before) she can take it to any car dealer and trade it in and get trade in value. Is this correct? My understanding is that you can't trade in something you don't own, unless you were actually buying the vehicle. I don't know if it matters but she has gone way over the allowed miles and has made a lot of custom changes. (spray in bed liner, new wheels, bumper guard, running boards, tinted windows).

    Any help would be appreciated.
  • qbrozenqbrozen Posts: 26,405
    Yes, she can trade it in and get trade-in value. The dealer would buy out the lease.

    Most times, however, trade-in value is less than what is owed on the lease buyout ... so she will be upside-down.

    What she needs to do is figure out if it will be cheaper to wait until lease end and pay for the overage on the miles ... or trade it in and pay the difference between trade-in value and the lease buyout.

    '10 Equinox LS; '08 Charger R/T Daytona; '67 Coronet R/T; '14 Town&Country Limited; '18 BMW X2. 49-car history and counting!

  • I have a 2001 Volvo C70 HT Convertable in excellent condition and has about 30K miles. My lease is coming up at the end of the year. The buy out price on the lease is $19.2K but they are now offering a buy out of $17.7K. The TMV ranges from $16.7 - 20.5K. I'm not sure which TMV I should look at (trade in, private or dealer). At the trade in TMV of $16.7K, the buy out price of $17.7 is not so great. When I spoke to Volvo Financing, they said that would be the best they can do. I'd like to keep the car only because I know its in excellent condition but I am not sure that this buy out price is worth it. Also, Volvo is coming out with a new line of convertables in 2006 so I am not sure how this will affect the price of my Volvo is I choose to sell it later. Please help shed some light. Any thoughts would be greatly appreciated. Thanks!
  • So they are offering you the car for less than the private party price but more than wholesale. That seems like a fair deal to me. If you like the car and it is worth $17.7k to you then go for it. Otherwise buy (or lease) something else.

    As far as future prices of cars - Who knows. The newer models are likely to cost more than yours so that's a plus in your favor. Take a look at your car here in Edmunds. They have a "True-Cost-to-own" estimate that shows estimates of future depreciation and other (estimated)costs.

    2001_Volvo_HT_Convertible_True_Cost_to_Own

    But that's just an estimate - your mileage may vary.

    Keep in mind that you'll likely spend less driving an older car (like your 01 Volvo) than buying or leasing new every few years.
  • qbrozenqbrozen Posts: 26,405
    Well, I saw Terry's response on the real-world trade-in values board that said the car is worth in the mid-17s on a trade, so you are right there with that buyout.

    The way I look at something like that is "would I buy this car from a dealer at that price?" Personally, i find a C70 HT convertible with 30k miles for $17,700 to be a SCREAMING deal and would jump on it in a heartbeat. YMMV.

    '10 Equinox LS; '08 Charger R/T Daytona; '67 Coronet R/T; '14 Town&Country Limited; '18 BMW X2. 49-car history and counting!

  • bmwcabmwca Posts: 5
    I want to sell my car to a friend at the end of my lease. However, I want to avoid getting hit for sales tax twice (once when I buy it from BMW Leasing and the second when my friend goes to register it). How do I avoid this double tax hit. I live in California.
    Thanks for the help.
Sign In or Register to comment.