Lease Termination Fees and other costs

oldfarmer50 · April 2008

"...a provision in their lease contract to handle the death..."

Yes, a contract is a contract and you have to live up to the terms, whatever they are. What I don't understand (and maybe the article left something out) is why did the dealer take the car back? It seems they now have a car worth more than it would have been but the widow is stuck with the full bill.

There was some mention of the dealer auctioning the car and applying the proceeds to the balance due. Is that how it usually happens?

If that's the case, and lets say the car brings $12000 against the 13000 owed it would seem more reasonable.

volvomax · April 2008

Yes, a contract is a contract and you have to live up to the terms, whatever they are. What I don't understand (and maybe the article left something out) is why did the dealer take the car back? It seems they now have a car worth more than it would have been but the widow is stuck with the full bill.

Since the car belongs to GMAC, it doesn't matter what the dealer does.
Car goes to GMAC, and the collections dept gets warmed up.
If the widows name was on the lease as well, that she is 100% liable for the contract.

There was some mention of the dealer auctioning the car and applying the proceeds to the balance due. Is that how it usually happens?

Again, the dealer does NOTHING.
Finance co auctions the car.

otto8 · April 2008

A older fella with a new leased Mercury I know passed away and the
leasing company demanded either make the payments or pay off in
full and return car.......................No idea if it was Fomo credit or
another leasing bank/outfit.

Why do regular people lease? Are they that stupid?

qbrozen · April 2008

Why do regular people lease? Are they that stupid?

HUH??
Just what is a regular person?

volvomax · April 2008

Why do regular people lease? Are they that stupid?

People lease for a variety of reasons.
Mostly, they don't want to keep a car for a long period of time and they want to drive more car that they could w/ a traditional loan.
In your friends case, had he bought the car via an auto loan, he(or his estate) would have been in the same boat. Unless he purchased credit life ins w/ the loan, which people are advised against buying.

jwlerch · April 2008

I'm buying out my 2005 Saab lease because it is over mileage. My contract says that I need to pay $13.5k plus "official fees." Come to find out that "official fees" are $695. This is on top of paying for a required safety check at my local Saab shop (the dealer told me they knocked off $300 for doing that) and $200 for license/registration transfer.

This seems really high, but I'm not in much of a negotiating position because I'm way over in miles. How much are these typically? Am I getting screwed here?

Thanks!
John

jaxs1 · April 2008

I have heard of some that forbid it and some that will work with you. Which auto manufacturers are friendliest towards transferring lease contracts?

Since 24 months leases usually have high payments, to lease a nice car for 24 months or less with a low payment and little or nothing down, I can see two options.

1. Leasing a new car for 3 years (or even 4) with the plan to have it assumed after 2 years. (If you get a bargain capitalized price leading to low payments and have an attractive amount of mileage allowance remaining for the next person, I would think it shouldn't be difficult to find a taker.)
2. Taking over someone else's leased car that has about 2 years left, low payments and more than enough of the mileage allowance remaining.

Any thoughts on this?

otto8 · April 2008

Any fool that CAN'T write it off !!!!!!!!!!!!!!!
Like a salesman that uses their car for business etc..............
But for the average Joe?

Soooo many horror stories of folks gettin' the screws put too them for over
mileage charges, damage etc..............
The BEST ones are the ignorant ones that want to trade out of their
sludgemobile for a different one 14 months into their 60 month contract!
Or the folks who want their trade in value so that they may "trade in" a
car they DON'T own............Again with the old "I am 8 months in on a
60 month contract and I can't afford it"

The old quote "A fool and their money are soon parted" is so true!

sebring95 · April 2008

Ive done a couple assumptions, the two most recent were 12 months into 24 month contracts and they had only put about 5-6k miles on the vehicles. In both cases the leasees were under duress and had to get out of the lease immediately and paid me to assume their leases. So my recommendation is option 2. While you may be able to find someone to assume the lease, dont count on it. If you look at any of the lease assumption websites, it appears the BAD and OK deals sit for considerable amounts of time. The only ones getting gobbled up are the desperate folks willing to pay the sharks (guilty as charged) to bail them out.

jaxs1 · April 2008

Yes, I saw some people on those sites trying to get out of some leases of cars they heavily overpaid for and/or are going way over their mileage allowance. I really don't see how they will find anyone to take those over.

However I saw a few that looked good, What do you think of this?
http://www.swapalease.com/VehicleSearch/VehicleDtlL.asp?VehicleID=393667

I think I'd rather have the car the first 2 years so I would have it while it's brand new, but I guess it will be more worry-free to be the one taking over the lease on a used car just like it's much easier to find a seller of a private party used car than it is to find a qualified buyer.

However, I think if I got a great lease deal on a desirable new car with low payments and kept the mileage under control, it would be an attractive lease assumption for some else and I would probably not have much trouble getting out of it after 2 years.

sebring95 · April 2008

Heres how I usually look at these lease assumptions: How much is the car going to cost me in total. Remaining payments plus residual. Is that less than I can buy the same car for today? If its close or less, then its probably not a bad deal. My first truck I assumed I basically drove it for 24 months for less than $1,500. My second truck I ended up buying out and still own today. Turned out it wasnt as great of a deal because trucks are worth nothing now, but I really liked the truck and decided to keep it. The BMW you linked to will cost you $5700 to drive for a year. Seems like a lot for a vehicle thats only $30k or so new. Looks like they got robbed on the front end or else had negative equity rolled into this lease.

jaxs1 · April 2008

Looks like that car has automatic plus Sport and Premium packages. It would have been well over $30K new with all the options. Maybe well over $35K. I think base sticker with no options was around $31K even in 2006.
I'll keep looking to see if there are some better bargains though.

This car looks good if it won't need $1200 in new replacement performance tires before it's return date:

http://www.swapalease.com/vehiclesearch/VehicleDtlL.asp?VehicleID=402989

I also notice it has 25 months left which means the seller is trying to get rid of it right before the next years registration fee is due and he also wants $1000 down.

Also why would a Mercedes be leased through BMW Financial Services? Maybe that's an error.

It should have warranty for the entire remaining period, but regular scheduled maintenance isn't covered like a BMW, and Mercedes maintenance is expensive.

sebring95 · April 2008

Regardless of the exact sticker, my point was it wasn't/isn't an expensive vehicle and the $700+ original lease payment was bogus to begin with. If it had substantial options, the residual should reflect some of those so the payment wouldn't be significantly higher due to a couple options. The MB isn't as bad of a deal, although I'd never give them any money down nor pay the transfer fees. If he put $3,000 down when new, that means you should be able to go lease a new one for only $50/month more net of the $1,000 he wants back. The idea behind assuming a lease is to find a bargain. I personally wouldn't want the MB and you touched on a couple reasons....

soonercat · May 2008

:confuse: OK, last week I "traded my 2007 Mazda CX-9 for a Toyota Highlander. Toyota dealer agreed to my payoff amount which was from Mazda Credit. Everything goes fine till now. Toyota dealer says no one at Mazda credit can accept the full payment of $23,902 from them that they have to go thru the original selling Mazda dealer 120 miles away to complete the transaction. This is madness. A business that will not accept the full pay off without a hassle. Does anyone have real deal expericence with Mazda process. I know Honda is easy, Nissan is easy and Toyota is easy as this is done every day of the week in the united states.

I am worried I will have to make another payment if this gets delayed.
thanks

soonercat · May 2008

dealer finally took the money for pay off after I called the GM. What a pain in the butt. Toyota dealer who I traded to had to send a check in person to do this --100 miles. Nice process.

outlookguy · May 2008

Having recently ended a relationship, my parter terminated the lease early on our 2008 Hummer H3 (GMAC) without my knowledge. The lease was in Calif and was "or" instead of "and"...The car was returned without my knowledge or consent and my ex-partner told me that I am liable for the termination fees b/c my name was on it as "or". and it's too bad if I didn't know this was being done. Is there any recourse? I came back from a trip to find out that my car was gone. I can only hope that there might be some hope for me after this hurtful action was taken.

tidester · May 2008

I am a little surprised that the leasing agent would write up a contract with "or" instead of "and." It would seem that the person doing the cancellation would be liable for the termination fees since that person intitiated the termination. I hope someone who knows California law will be able to provide guidance. Good luck.

tidester, host
SUVs and Smart Shopper

kyfdx · May 2008

But, I think "or" means either one of you can be held responsible for the charges.. The bank likely doesn't care about your personal issues, as long as they get paid.

Your partner likely thinks that you'll pay the charges, so it won't affect your credit. Said partner obviously doesn't care about their own credit (as they are still on the hook, as well) or thinks you'll pay it, if they don't.

In the big picture, I don't think "or" or "and" makes a bit of difference. The bank isn't going to lease/finance a vehicle to two individuals, unless either of them can be held liable. You entered into a financial agreement with your partner, and you are stuck with the consequences.

If it were me, I would make sure the bank gets paid (to protect my credit rating), and then take my partner to small claims court for financial damages.

regards,
kyfdx
visiting host (and not a lawyer!)

dwynne · May 2008

Or see if the vehicle in question is still sitting on the dealer's lot. If this just happened then it probably is. Then try to un-wind the early turn in and get possession of the vehicle and take steps to get the other name off the paperwork.

After calling the dealer and/or lease bank to see if you could get it back the next call should be to a lawyer.

Dennis

volvomax · May 2008

Example #1 why you NEVER buy or lease a car w/ a boyfriend/girlfriend/partner etc.

disco6 · May 2008

HELP!!!!!!!

Has anyone ever turned in a lease on its due date but had an outstanding balance of 2 months worth of payments but was advised by the dealership personal that the leasing company will send me a final bill. After being advised of this I only found out that this defaulted my contract and I now went from owing $1200 to $11,000. Does anyone know what can be done??????

dtownfb · May 2008

How about calling the leasing company and talking to them about this which is what you should have done in the first place? My advice, call the leasing company immediately and work something out. Right now you have a default loan on your credit report.

gbosley · May 2008

Disco 6 , i can only hope that you have hired a attorney , or possibly talk to your state attorney general office about this .
any lease that i have had if i was over mileage i paid dealer that day and had a sign off sheet that car was return and condition it was in and any money that i paid
usually with 90 days i get a sign off from manufacture
all my lease have been through Ford /GM
and closed end lease
i knew back in late 80s and early 90s they had open end lease which you would be held liable for the final residual so if you had open end lease they said your car be worth 20,000 and at auction they got 9,000 you be held for additional 11 but i don't think there any more of those type lease still out there
another idea is the TV station in your area if they have consumer help you might contact them , good luck

dwynne · May 2008

Being two months behind on your lease payments messed you up, not the dealership or the turn in process. I would bet the dealer didn't know anything about the state of your lease payments, they just accepted your car on behalf of the lease bank. One would HOPE that the limit of your liability would be for the 2 missed payments plus any damage, excessive wear and tear, or over miles on the vehicle you turned in. But if they declared you in default of your contract, you will need to read all that fine print on the back to see how bad things could get.

As was mentioned, if you signed an open end lease you are really in trouble since you have to either buy the car at lease end or pay the lease bank the difference between the lease residual and current auction value.

When having troubles communications is the key. If you failed to pay payments and thought just dropping the car off would solve all the problems you are mistaken. If you let the bank know you are having a problem and are willing to work with them to make it right, then they tend to cut you more slack.

What make and model car was it and which lease bank? You are a lot better off if you are dealing with a "captive" lease bank - like Honda Finance or Infiniti Financial Services than a 3rd party bank.

Dennis

volvomax · May 2008

Rule #1 when returning a leased vehicle: ALWAYS call the lease co beforehand to go over the actual procedure. Esp if there is money owed.
now, you should be ok sending them the late payents,plus any penalty, plus the end of term fees.
However, you would have t carefully read your contract to be certain.

baldrich · May 2008

I was considering purchasing my car at the end of my lease (or selling to a third party), but I noticed that the wonderful people at Wells Fargo have tacked on an additional $750 beyond the residual value to calculate the payoff amount. Is this normal or customary? Any way to make it go away? If not, any way to keep it from happening in the future...other than the obvious, steer clear of Wells Fargo?

Thanks...

dwynne · May 2008

Did you read your lease contract before you signed it

?

It should be on there, if not then you should be able to make it go away. Some 3rd party banks charge you a fee if you turn it in, but waive it if you buy it at lease end. Some charge you a fee no matter what. Most captive lease banks (Honda Finance, etc) don't charge either fee.

Is the auction or trade value of your car more than the buy out price? If so, then you probably do not want or can't sell it anyway and the bank has little reason to discount it to you. If the value is not there you may can get them to discount the car rather than turn it in. They used to do this all the time, but now most banks carry residual value insurance that pays them the difference between the residual and what they get at auction. This means they get more money by refusing to discount the car to you and selling it at auction. It is usually better to show no interest in buying the car until they ask you about it or make you and offer.

Just always read the lease contracts and look for these types of fees and decide if the deal is worth the extra - and try to keep leases to captive lease banks if they offer a better deal. Honda, for example, offers damage forgiveness of up to $500 per item, $1,500 total on lease turn ins. So a couple of dings, a scratch, a couple of bald tires = no pay out for the lessee at the end of the lease. Most captive banks have no such forgiveness.

I should also point out that in most states title can only transfer from the lease company to either you or a licensed car dealer. It can't go from the lease bank to some person who wants to buy your car. So unless you route the transaction through a dealer, you will have to buy the car and pay tax then sell it to your buyer and they again pay tax. That usually means no deal due to the higher selling price. Some states (CA?) allow you to apply for a tax credit / refund if you sell a car you just purchased.

Dennis

joel0622 · May 2008

Disco 6 , i can only hope that you have hired a attorney , or possibly talk to your state attorney general office about this .

Why?????? The D6 is behind on payments and termed the lease. What can a lawyer do?

The majority of the industry uses third parties now for LTI. The customer drops off the car and the leasing company comes and picks it up at a later date.

Allot of Dealers are no longer in the LTI or inspection business.

joel0622 · May 2008

Late to the party on this one. If you are 62 years old or older at the time you enter into a Ford Credit Lease or Loan and you pass away during the term the debt is forgiven. You turn the car back in and Ford wipes the slate clean.

volvomax · May 2008

It's quite normal, its called a buy fee.
It is in your contract.

chrishh · May 2008

I thought I understood how leases were calculated but the dealers proposal caught me as dishonest.

Here are the facts from the sheet they gave me.

Price, 30104.00
Term, 36 months
Factor .00150
Days, 30
Residual (36m 15k) .57 (17160)
Doc fee 400
Deposit 550
Tax Rate 7%

This came out at 532.26

I assume some of it is tucking GAP in there but I can't get near their total, what I usually come up with is in the $470 range. Any ideas?

tidester · May 2008

Did you read your lease contract before you signed it ?

The question was whether the fee was normal or customary. It is not normal or customary for a lease to spell out which provisions are normal or customary so merely reading it would not answer the question. The answer is that the fee is normal as Volvomax correctly pointed out.

tidester, host
SUVs and Smart Shopper

volvomax · May 2008

Is $30,104 the MSRP?
Is there an acquisition fee?
How much out of pocket?

chrishh · May 2008

They did it using MSRP. There was no other dollar amounts given. The only notes were to pay the doc fee and one advance payment up front.

Zero out of pocket other that first payment. We had discussed a negative equity trade but I specified I would pay the difference between what it was worth and what I owed so it would have no effect on the lease other than to reduce the taxes.

That is what has me confused by the final numbers. It appears they figured it out then stuck a bonus for themselves into the monthly. I was using the leasingguide pages to figure what it should cost and could not get their number using all the available numbers on the lease work sheet.

Other sheets they presented, 24mons with .66 residual came out to 653 and 48 with a 47 residual but a 00190 factor came out to 500.

Something just tells me they were embedding other profit in there and trying to get me to buy on monthly payment instead of the cost of the car

fordfool · May 2008

> They did it using MSRP.

This should be negotiated just as if you were buying the car.

> Doc fee $400

This is also negotiable; best to just ignore it.

> Something just tells me they were embedding other profit in there and trying to get me to buy on monthly payment instead of the cost of the car.

Treating the $550 deposit as reducing the cap cost, the monthly (36) payment (including tax) should be $444.26

The dealer is trying for an extra $3168 on a car he's already selling at MSRP. :mad:

dwynne · May 2008

I have no idea if a $750 purchase fee is normal and customary for their lease bank or not, do you? The way to know if that is normal and customary is to read the contract they signed when they leased. If it is printed (not written) in the contract then that is the normal and customary fee. If it is written in then that is probably not the normal and customary fee. If there is no fee listed at all or one other than $750 then they lessee has room to complain.

So yes, "read the contract" is far more useful advice than "it is a buy fee". Yes, some lease banks have them but you have to read the contract to know if they do and how much it should be. The normal term for such a fee is "purchase option fee".

The real issue is the person posting was thinking they had "Tacked on" the fee. Maybe they did, maybe they did not - the way to know is (repeat after me) "read the contract they signed"

.

Dennis

disco6 · June 2008

Well I did make contact with the leasing company which is Chrysler Financial and I was informed that the my contract was closed out as of 1/25/08 and the lease was not due until April 3, 2008 and I did not owe anything. I knew this was not true and tried to make a payment online prior to me turning the lease in a was unable to do so because my account online was closed. I have recently been in contact with a lawyer an he is willing to assist me.

dcomber · June 2008

My lease for a 2005 Honda Accord EX-L V6 with Navigation was set to mature on 7/26/08. I only have one payment left and decided to look at options for a new car. Went to an Acura dealer and decided I liked the 2008 Acura RDX with Tech. Seeing as my maturity was 7/26/08 and I had one payment left, I asked the dealership if I could simply turn in my current car to them and lease another one. They told me that Honda Finance has a loyalty program if you plan to lease another Honda/Acura where you can simply turn your car in and lease a new one (especially since I only had one payment left).

I struck a deal on the Acura RDX with Tech (1400 below invoice) and was ready to sign the papers. I asked them, specifically, about my current lease and if it was better to just pay the last payment and turn it in. They told me that they would make the payoff on my current lease and I would be free and clear without having to make the last payment. I know they checked the payoff amount on my current lease because I gave them my last four digits of my SSN and I was in the office when they were on the phone with them. After they checked this, they told me that they would definitely make the payoff and I was done and could now lease an Acura through AHFC again. Once again, I asked them several times as I was still skeptical and they told me that they would make the payoff and I was done with that lease. Thus, I signed the new lease (the finance manager and the GM seemed very honest). The trade in for my Accord lease was noted on my sales contract for the Acura, however, it listed the trade in as "N/A". I didnt think i had any positive equity and figured this was being noted to declared I traded it in without any numbers effecting the deal.

So I got the new Acura, but now I am wondering if everything is kosher because I am worried if I really traded in the car and its paid off or if I am going to owe more money. Here is why I am worried:

Payoff: $16,389 (online from AHFC)
Residual Value @ Lease End: $15,027

My question is, since they "paid it off", am I completely done with that lease or am I going to owe money? Also, am I still liable for any negative equity (if applicable, i dont know?) and wear and tear, fines, etc.? Does the dealer simply pay off the value I currently owe or is there another value that AHFC gives to the dealer to pay it off where I am still liable to pay the excess between what I'm quoted or what they might have paid it off for?

Also, will they simply let the car sit on there lot, make the final payment and do the inspection on the car and take over it, but will i be liable for any wear and tear beyond the $1500 allotment, fines, etc.?

I only allowed this because the dealership ensured me that this lease would be paid off in full and I was out of the lease, especially since I was entering a new lease with AHFC.

I also figured that if the dealer wanted the car to sell on their own, they'd have to make the payoff to get the title.

I also asked other colleagues who I know who have done the same thing with AHFC and they told me they never had any problems (all of them did this because they were over on their mileage allotment).

If there are any issues from what I've descrbed, please let me know what to do and any advice that you have. Just a tad concerned I screwed up, but hoping since i only had one payment left and did another AHFC lease that this is normal and a regular course of business..

Thanks!

dcomber · June 2008

Well, just called the automated quote center for AHFC and found this out:

If I, a bank, or credit union wanted to pay off the lease it would be $16,388. If its a Honda/Acura dealer, its $15,302 and good until 6/17/08. I am breathing a little easier now because I can see that the dealership agreed to make payoff because the difference in what the payoff would be for them and what the residual at lease term would be is $274.86 ($15,302.01-$15,027.15).

I know, I know I should have done this before I agreed to it, but I didn't know and it was my first lease. If there is anything else I have to worry about, please let me know. I'm sure the dealer will make the payoff and sell it for $19k and make a nice profit. At this point, I dont care about any positive equity, etc, I just want be out of the old lease and enjoy the new one. I would also assume that if any issues came up, it would be a little easier to sort out since I am still a client with AHFC and in a new lease with them (right?).

If there is anything I need to know, please let me know. I'd be happy to go back to the dealership and ask any questions/get clarification if need be. I have to say they were pretty honest and up-front with everything, but just want to be sure.

qbrozen · June 2008

As long as you didn't have miles in excess of what you were allowed and as long as you didn't have any excess wear and tear beyond $500, you are fine.

The reason the payoff is lower for a dealer is because they don't have to pay tax. If you bought it from Honda, you'd pay the sales tax.

dwynne · June 2008

I what user qbrozen said is correct, they could have been including sales tax in the quote to you and not to the dealer. The price to ANY dealer should have been the same, not just to a Honda or Acura dealers.

Did you have your pre lease turn in inspection done? If so, then you know where you stand with the car as far as wear and tear and how much, if any, AHFC was planning on charging you for those items that are beyond normal. If not, then then I guess you just have to keep your fingers crossed you don't get a bill from AHFC for bald tires or door dings or paint chips. Keep in mind, they have $500 per ITEM maximum "forgiveness" to a total of $1,500 max for the car. So you would have to have turned it in pretty beat up to owe anything.

The dealer could have purchased your car and not just accepted the turn in. If they accept the turn in (no matter who pays the last payment) then you would be on the hook for any over miles or excessive wear and tear. Also the dealer would have to turn your car over to Honda's auction folks for disposal. Did you fill out a end of lease turn in form at the dealer's lot? If not, then you may not have officially turned the car in.

If the dealer took your car in on trade and purchased it from Honda, then you are totally off the hook for the old lease and the dealer now owns the car and can sell it to someone else.

You can call AHFC and ask to speak to someone in the end of lease department (I will try to dig up the direct number later) and give them your account info and VIN and see if they say the car has been purchased, turned in, or if they know nothing about it.

Dennis

dcomber · June 2008

Thanks Dennis! The dealer told me they were paying off my Accord Lease in full. On my new Acura Lease (closed-end) the area where it lists Credit For Net Trade-in Allowance lists my 2005 Honda with a "$ N/A" due to the buyout. I am assuming they put N/A since they were simply paying off the vehicle and not using it for the next lease calculation.

I specifically asked them if they were going to pay it off or if they were going to keep it and make the last payment (fulfill the lease) which I would not have allowed because there is too much liability with that. I would have just waited until my lease ended to purchase at that point.

The finance manager demonstrated (over an hour) all the costs and how the line items came together (over an hour) so that I was understood everything.

dwynne · June 2008

I would follow up on it, that is what I did when we traded a near lease-end Accord in on a new Pilot for my wife. Similar deal - they purchased the car as a trade in for the current lease buyout price (excluding tax). So I wanted to follow up with AHFC to be sure that they paid it off in a timely manner and did not list it as a lease turn in.

The direct number to the end of lease folks is for Honda is 800-351-6509 . The main number is 800-708-6555, but I think you would want to talk to the end of lease folks. If nothing else, you need to let them know where the car is and what your deal is - that the dealer is supposed to be purchasing the car and you are not turning it in.

If you had set up your AHFC account on ownerlink or on the AHFC web page you can login now and see what it shows. If they have paid it off it will show a pay off price of $0.00 . If they paid the last payment and accepted it as a lease turn in it will show no payment due (or due 12/31/9999) but should still show a pay off or buy out amount. If they have done nothing yet, it will show the next payment still due and the same buy out as before.

Dennis

dcomber · June 2008

Thanks again Dennis..they told me that it would take 10 business days to process the payoff with AHFC. It sounds as if this is pretty standard with most payoffs from other people I've talked to. My next payment is due on June 26, 2008. I'm going to call AHFC and discuss it with them today, but from what the dealer told me, I do not have to make the last payment as the payoff will be completed by then (probably by 6/20 or 6/23). The finance manager said it would probably be done in 3-4 days, but said it could take up to 10 business days. Once again, I specifically asked the finance manager whether they were making pull payoff or just making the last payment and completing the lease-end process. They specifically told me they were making payoff and that when it the payoff arrived to AHFC (latest 10 business days) I would be done with that lease and owe nothing (termination fees, wear and tear, etc.). He also told me that he would send me a copy of the check for payoff if I wanted one to be sure. I said yes.

I doubled checked this with my sales rep and here is his response..

"Dean, No bother at all, you are completely done with your Accord, you do not need to make your last payment. Thanks, Sean"

I was just neurotic about the whole thing so I emailed him to confirm. I figure since the car was 10k miles lower than where it should have been at this time and since its a honda, they figure they could buy it at their payoff ($15,302) and sell it for a nice profit on their lot. I also figure since I was staying with AHFC in a new lease, there wouldn't be any games or fines as I was staying a customer.

dwynne · June 2008

Always follow up in any case, even on a trade in that does not involve a lease. You and only you are responsible for making sure the paying is in on time and that the car gets paid off (if that is the case).

We had a crooked new car dealer in town a few years back and I know several folks who had to pay interest and had lates on their credit reports because the dealer was playing games with the trade ins. So always check to be sure all is well.

Dennis

dcomber · June 2008

Just called AHFC and they were aware of the intended payoff. As you mentioned, they just wanted to know what dealership the car was located at. The rep from AHFC told me she was going to watch the account and would let me know (call) when the payoff was made. She said its pretty standard for the payoff to be 10 business days. I'll update the forum if anything goes wrong..I pray it doesnt..

I asked her about keeping the insurance on it, and she said I should just in case anything happens before the payoff. I found tha a bit odd because what if some porter decided to take the car out for a spin and got in an accident. Thus, it would be on my insurance (unlikely to happen, but ya never know). Since I have 30 days to add the RDX on the insurance, I'm hoping timing is right so that the Accord is paid off and I can simply drop it and add the RDX.

Once again Dennis, thank you so much for your insight! It is greatly appreciated!

dwynne · June 2008

No problem, glad everything is working out as it is supposed to

.

My insurance company (State Farm) offers a 30 day overlap period so if I pick up a new car before the lease is quite up on the old one I am covered for "free" on the 2nd car for up to 30 days. Sounds like yours is the same - you should be able to go ahead and add the new car onto your policy but just not cancel the old one until AHFC has their money.

Dennis

kyfdx · June 2008

Check with your agent.. I think State Farm just changed that to 15 days.. recently..

At least, in KY..

dwynne · June 2008

I just did less than 2 weeks ago and he said I was covered. Hopefully he is correct since I do have an overlap.

Dennis

bigbutr · June 2008

Given the market for large vehicles and the fact that dealerships don't want them, should I expect to be henpecked on my 06 Odyssey van EX-L w NAV/RES when we go to turn it back in at the end of our lease?
We are well under the mileage limits (got 45,000, sitting at 34,000 with four months left) and just had some scratches (van keyed while on trip to Disney :mad: ) and dent repaired (someone backed into door, but didn't bother to stick around :mad: ). So, exterior-wise, it looks brand new. The tires have decent tread on them and all maintenance has been done at the dealership.
Interior-wise, there are carpet mat stains, as there would be with any 5-year old around with crayons, but I could easily replace those if need be.
I know we have a $1,500 limit ($500 per incident), but given the cost of things these days, I could easily see how little things would add up. I just know that I won't be trading it in because given the market, there is no way I think anyone would offer anywhere near the $22,000 residual on it. We've decided (well, my wife anyway) that a Lexus RX400h is the next vehicle, and it's much easier to deal from a position of no trade than it is with one.
Since we'll have plenty of miles left, we want to just drive it to either Birmingham or Orlando and drop it off at a Honda dealership there, then go over to the Lexus dealership and pick up the new ride. Are there any problems we might encounter doing this. If we have to turn it in where we bought it, I guess we could just rent a car one way, but I'd rather just drive the van if I have the miles.

Lease Termination Fees and other costs

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