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Focusing on the front-end costs also ignore the very strict return rules, which seem to get tighter and more rigidly enforced every year - over mileage is extremely expensive, and judgment of "reasonable wear and tear" can be draconian. (Another thread mentioned a lease agent using a tool to search out non-factory paint, for example.)
Which is why the OP's question about whether you can sell your lease is relevant. When you do that instead, you avoid a lot of that check-in malarkey.
Which is why the OP's question about whether you can sell your lease is relevant. When you do that instead, you avoid a lot of that check-in malarkey.
It depends on whether you are truly selling the vehicle to another party (with all lease termination and prepayment costs and penalties to be considered) or simply exercising an early-return option, in which case things like mileage will be pro-rated and 'wear and tear' still evaluated.
The major point of a lease is that they want to sell one person the "new new" under the most profitable terms, then have a "new" vehicle back to sell at the most premium price. Everything else is window dressing and the lessee better not return a vehicle that is in any way "used" past a very narrow definition.
And the OP's question is about rolling this leasemobile over on another, which further complicates issues. I can see gotchas like when you trade in a vehicle with a loan, and simply bundle the payoff in with the new loan, which is one of the absolute stupidest consumer lending moves possible. (I'm not saying that's the case here, but that I'd read all the fine print in such a lease rollover very, very carefully.)
Presenting it as a good thing because of the low payments is (or should be) a huge red flag; there are very few consumer situations where lower payments represent any kind of best deal. For one thing, those "lower payments" often come after a whopping initial payment higher than most purchase initials.
I would disagree with the bolded but in any case, there are a disturbing number of customers that buy nothing more than payment.
Quote:
Originally Posted by Quietude
It depends on whether you are truly selling the vehicle to another party (with all lease termination and prepayment costs and penalties to be considered) or simply exercising an early-return option, in which case things like mileage will be pro-rated and 'wear and tear' still evaluated.
The major point of a lease is that they want to sell one person the "new new" under the most profitable terms, then have a "new" vehicle back to sell at the most premium price. Everything else is window dressing and the lessee better not return a vehicle that is in any way "used" past a very narrow definition.
And the OP's question is about rolling this leasemobile over on another, which further complicates issues. I can see gotchas like when you trade in a vehicle with a loan, and simply bundle the payoff in with the new loan, which is one of the absolute stupidest consumer lending moves possible. (I'm not saying that's the case here, but that I'd read all the fine print in such a lease rollover very, very carefully.)
I don't know about "Gotcha's." But yeah, you don't want to be rolling negative equity over, no matter how you buy. And definitely make sure they're taking your vehicle in on trade.
In 2013, I leased a Toyota Highlander Limited for my wife. I wanted to buy the car, but my trade (2008 Volvo XC90 V8) looked a lot better via the lease route instead of buy at that time (November 2013). New model coming out, dealers/manufacture eager to move out the old model. I knew I would buy this Toyota regardless, so I focused on the residual value. All in all, I paid a good price for the car between lease payments, down payment, residual payoff to purchase, roughly $1,500 under sticker. I was ok with that number. I don't work for free, and don't expect others too either.
But what I did have a problem with, was the dealership when it came time to either return the car or buy it.
2016, lease expiration coming up, we're going to buy the car. Toyota instructs me to go to my nearest dealership to do the paper work. I do.... and my residual price tag that we had already negotiated 3 years earlier and was in my contract had magically increased by....$1,500! Care to guess what it was labeled as? I'll give you a hint - prep.
They tacked on $1,500 in "doc prep fees" and other assorted fees for me to buy this car.
I called Toyota financial directly, said I wanted to buy the car at the residual price, don't want to deal with the dealership. It was done in a week, at the residual price in the contract, no issues.
I returned to the dealership a few weeks later to have a warranty issue fixed. Salesman sees me, puts the full court press on to continue with our process. I told him I had already bought it, direct from Toyota instead, for the price we agreed to years earlier. He was furious at me. I could tell he wanted to throw me out of the dealership. But his manager came over, and sent him off to do something else. Manager explained to me that the $1,500 they wanted to charge was their profit margin in the car. I told him to show me anywhere in the lease agreement that said I have to pay for your "profit margin" in addition to the residual contract price. He couldn't, knew he couldn't, knew that I knew he was full of BS and was trying to scam me. He turned and walked away.
Last time was ever at that dealership. Got a call from Toyota a few months later asking me some strange questions about that dealership. I could tell they were looking into them for something, and I suspect customer complaints via lease transactions...
Well, there's generally less repetition here than on "social media," where the posts have the lifespan of a mayfly but the topics live forever.
And not everyone has gotten the message about dealerships.
You mean like the Porsche dealer that I (almost) "trust", my salesman calling me on a used deal for an exotic? It really was a deal, by the way, though we're talking $190K which ain't chump change to most of us, me included. Summer last year, this was.
...He neglected to mention that that next generation of that car (991.1 GT3 RS, for car nuts out there) was about to arrive, the Dot 2's, making the market soft on the Dot 1s. As a dealer, he knew to the day when those Dot 2's would be delivered. I figured this out after looking at that lovely low mileage Dot 1 for comparatively good money; there was a time, 2-3 years ago, you couldn't touch one for less than $300K due to demand and massive speculation. That collapsed, hard, for various reasons past few years.
$190 was basically the MSRP, btw, which was $192K. It was a '15 or '16.
If a dealer emails me, much less calls, I can be sure someone is getting pimped, the Three Card Monte, call it what you will. And it isn't them.
My opinion on leasing vehicles is simple. Only lease luxury vehicles which have low resale value, high depreciation and high maintenance costs in the long run. Also, it is ok for it to be your daily driver if you don't have long commute distance for work. It should not be your primary vehicle.
"Low on inventory". Usually not. As said, just a way to get you in the door. I got a call from the dealer the other day wanting my 2014 F150 because its " inventory of used trucks is low" it " had someone sitting here that wants it and they'll put me in a new one for the same payment I had "
No it isn't and no they don't. I just told the saleswoman that I'd looked at their new inventory the other day, I actually had, and saw nothing I'd want. She then mentioned they had some new Rangers. I told her especially not a Ranger.
btw in my state, i get taxed on the retail value of the vehicle and not the leased value so everytime i go through licensing and registration on a luxury leased vehicle its costs me some additional $$. For that exact reason I would prefer not to go through that transaction unless I really have too.
My opinion on leasing vehicles is simple. Only lease luxury vehicles which have low resale value, high depreciation and high maintenance costs in the long run. Also, it is ok for it to be your daily driver if you don't have long commute distance for work. It should not be your primary vehicle.
We've currently got a lease on our only vehicle. But I work from home full time. So we only manage to put ~5k on a vehicle a year. Near guarantees that it will be worth more than residual at the end of the lease. So we can then decide whether to cash out that 'equity' or purchase a nice one owner well maintained vehicle that we know everything about for well below the market value. And we'll just admit that we like having new vehicles. Even when purchasing we're still swapping out every 2-3 years.
^^the above^^
Has not ever held true. The moment a car goes off the lot..20% value is lost. Period .
Yes the original poster who questioned the gimmick is wise to question the intentions of the dealership.
I buy mine outright. And a year later I get a similar promo that because my very model is in high demand...I could sell it back for a new model! I did enjoy that joke of a twist. If a business can't keep enough stock it's not my duty to lend them a hand or my checkbook.
The dealer gets its money upfront on any leased , financed or sold vehicle. Unsure where it's stated elsewhere.
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