End of Lease Buyout Questions - Help Please - Page 2

guls · 05-15-2008, 03:57 PM

I've never leased a car/ truck. But my advice be to first check if the pay off is less then Blue Book value. If pay off is more then the kbb then there is no use of buying it off.

**HudsonValleyTitan** · 05-15-2008, 04:17 PM

Residual pay-off on a lease and KBB aren't the same. KBB is what it's worth now, Residual is what's left after all the payments you've made are subtracted from the price when the vehicle was leased. So if the vehicle was $40k when new, and you've paid $25k over 3 years, the residual SHOULD be around $15k. And it used to be that you could negotiate the end of lease buyout but now they're insured to any loses so...either "buy it or drop it off" is the attitude.

tholmes · 05-15-2008, 05:08 PM

The other thing to remember is his mileage allowance. If you only have a lease allowing 15,000 miles a year and you average 20,000, they are going to charge you a fee per mile and pay a hefty amount for the extra miles (usually around $.25 per mile). That can add up quick. Honestly, unless you have a problem where you like to have a new car every three years and you enjoy making payments for life (essentially because you never own a vehicle and keep buying new ones), a lease doesn't make much sense for the average buyer, especially if you are going to buy it in the end. Best option is to buy a car outright and drive it till the wheels come off.

**HudsonValleyTitan** · 05-15-2008, 06:18 PM

Quote:

Originally Posted by tholmes

The other thing to remember is his mileage allowance. If you only have a lease allowing 15,000 miles a year and you average 20,000, they are going to charge you a fee per mile and pay a hefty amount for the extra miles (usually around $.25 per mile). That can add up quick. Honestly, unless you have a problem where you like to have a new car every three years and you enjoy making payments for life (essentially because you never own a vehicle and keep buying new ones), a lease doesn't make much sense for the average buyer, especially if you are going to buy it in the end. Best option is to buy a car outright and drive it till the wheels come off.

If you buy it at leases end, mileage doesn't matter. Some people lease because the monthy payment is cheaper. They don't care that it's more costly in the long run.

barnold1 · 05-15-2008, 08:05 PM

I think my mileage penalty is $0.15 per mile and it would cost a few grand. I chose to lease with the intent to buy now because I wanted to keep the payments low. I'd rather make a longer string of lower payments if it frees up cash to put more towards other goals. My lease rate was under 4% if I recall correctly and the buyout financing will be around 5%. My long term investments return more than that and my marginal tax rate (fed/state/city combined) is around 33%, so I'd rather tuck away additional funds instead of making truck payments at $800+ per month or whatever just to get it paid off as quick as possible. That's just my perspective and others may have different priorities.

tholmes · 05-15-2008, 08:17 PM

I was talking about over mileage fees if you decide to turn it in. I know you don't get them if you keep the car.
That is also very true about lease payments being lower... sometimes. I guess that is all gonna depend on credit score and negotiating power and what the dealer's specials (financing) are when you buy.

barnold1 · 09-11-2008, 07:04 PM

As a follow-up to where this went, McCarthy Nissan held fast that they were entitled to rape me for an extra fee since they were arranging the financing (though they wouldn't release my payoff quote to the financing I had arranged, thereby holding me hostage). NMAC kept pushing it back, saying McCarthy wouldn't return their call and assuring me there would be no penalties since the dealer wouldn't close the deal. Then, after a month, a closer dealership (to my home) opened up and agreed to facilitate the lease buyout. I thought NMAC made good, but had more to follow.

Per my first post, I was told my $400 security deposit from the lease inception couldn't be applied towards payoff and would be refunded. So I wait a few weeks and it wasn't returned. I placed a call to the guy who had been my contact and left a VM, but didn't get a reply from him. A few weeks later, O called the toll free line and (after the customary wait-out period) got a front line CS rep on the phone, who informed me my $400 deposit had been sent to the dealer as part of the payoff. I called Lee's Summit Nissan, where the finance manager (who I had worked with) acted like he didn't know what happened to my deposit but after I went off "discovered" they had received a check for $313 and change and the receptioness "had applied it as a payment." So the dealer cut me a check for the money they had received and to date I haven't been able to get a reply from NMAC on my missing $86 and change. I know it isn't a lot of money but I feel like they are stealing what's mine. I have to call the 800-NISSAN1 re: my leaking exhaust manifold/federal emissions warranty coverage anyway, so I'll address this again with them.

And the funny thing is, today I get a call from the McCarthy Nissan dealership asking me to trade in on a new Titan with $1,500 loyalty refund.