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(from here). Canadian article, but I doubt it's that different in the US.
Honda [Financial] already is gonna eat the difference.
Let's pretend I don't buy it at the end of lease. Then Honda has to sell a used car that's been in an accident - something anyone with internet access can find out and use to haggle a lower price. Which is exactly what I would do if shopping for a used car.
That is correct. In my case, it's actually Honda Financial that is the lessor.
Anyway, I found another article to suggest it is possible:
from here.
I have never heard of a *Customer* negotiating a lease buyout with the Lessor for less than the buyout stated in the lease. I'm not going to sit here and tell you I know with 100% certainty that can't be done because I don't have experience with all the OEM's, but what I can tell you is this:
- Many OEM's/Dealers have agreements that prohibit the Lessor from negotiating reduced lease-end buyout amounts with customers. The two main benefits of leasing to dealers is the fact they get the customer back in their door 2-3 years later *AND* it puts a solid supply of new-ish vehicles into the auctions for them to buy for their used car lots. This is precisely why, 99% of the time, the lease end value is higher than what the vehicle is worth. It's done that way on purpose.
The only time I've ever heard of lease end values being "negotiated" is when the Lessor (Finance company) has done some special pilot programs. I know that has been done on the Ford and GM side under certain conditions where maybe they allow the dealer to buy the cars for $XXX under the lease end value. But all of those were targeted programs, sometimes on specific models with certain mileage ranges, done with dealers only - not customers. In many of those cases other dealers protested such an arrangement because they felt some dealers (who had a lot of lease cars coming back to them) could cherry pick the cars they wanted.
Typically, financially speaking, one of the worst things you can do is lease a car for 2-3 years and then buy it at the end of the lease. You would have been better off just buying it from Day 1. Go shop for a car like yours at lease-end and most of the time you can get a comparable car cheaper than your lease end value. If that car is worth a "premium" for you then so-be-it, that's your choice to make. Plus, keep in mind, with an accident already on that car's record you better be able to buy it for a lot less than your lease end value somehow, otherwise you carry that accident depreciation baggage with you if you end up buying the car at lease-end.
Try these guys, it's a good Q & A about diminished value claims in general. Prepare to get your hands dirty. Even with a very comprehensive diminished value report, you'll need to be pro-active. Follow the advice of the appraisal company that you hire.
I've never leased before but evidently I can try to negotiate the purchase price at the end of term.
It's been a while since I've leased, but the residual value is already set the day you sign on the dotted line and lease the car. When you return the car, and want to buy it...you already knew how much it would cost you.
Also, my leased car was rear-ended, and fixed good as new. They inspected it when I returned it and said all-good. That was the end of that.
I'm going to add to the Op's question. What happens if the other guy doesn't have insurance, or agrees to pay for repairs? Do you demand an amount from diminished value from them? What if that person is broke, or has little money? Do you get it from your own insurance?
Your uninsured/underinsured motorist coverage will cover the repair. The insurance company will pursue a judgement from the other driver, but whether or not they're successful will have no impact on your claim.
Since you’re leasing and the vehicle is all fixed you just turned it in at end of lease. If you want to purchase the vehicle you have to pay what is agreed to at time of you taking position and sighing the lease contract. You can’t take anything off the price you agreed to at time of you signing the lease contract. It’s not Honda responsibility to lower the buyout amount just because you had a accident. Welcome to the real world. You can’t negotiate a different price at the end of the lease you signed a contract to pay x amount sorry your stuck at that price.
This is what's nice about a lease you have options not obligation's
Can a finance company sue you for automobile diminished value?
Can a finance company sue you for automobile diminished value?
People who lease cars should know that finance companies have started to come after lessees for diminished value if the car was in a wreck while in their possession. One of the absolute luxuries of leasing was, regardless of what accident repairs were done during the lease period, there was no concern about being charged for the car's diminished value. A car that is owned suffers a similar loss in value once it is saddled with a repair history so that individual absorbs the loss amount personally. Finance companies were content to take back previously repaired cars without penalty but times have changed. Rental car companies have been seeking compensation - now the finance companies seemingly want their pound of flesh as well.
There is no blame to assign unless you want to beat yourself up for backing into that utility pole. Why shouldn't lessors receive the same consideration you do when a third-party damages your personally-owned car? Third-party inherent auto diminished value claims are now well-known remedies. An errant driver damages your car. After repairs the car certainly isn't worth what it was before going under the welding-torch so you make a claim against the car owner's insurance policy for compensation. Those of you who lease cars are now facing the same unpleasant fate as are the insurance companies.
When a Carfax or Autocheck Report shows that a car had structural damage or air bag deployment, a dealer can no longer certify a car, banks won't finance it and off to the auction it goes. When a leasing company sells an off-lease vehicle, any sensible prospective buyer will ask for the car's repair history. With just a little research, that buyer can determine just how much the previous loss affects the car and will make an offer accordingly. The result? If the car you were leasing had a fair market value of $40,000.00 and suffered damages as described, it will lose close to half of its value. Expect a bill for $15,000.00-$20,000.00 from the finance company. You may be able to negotiate it down by obtaining your own independent appraisal but, make no mistake about it, you are legally liable.
[quote=FRANKLIN;55785824]Can a finance company sue you for automobile diminished value?
People who lease cars should know that finance companies have started to come after lessees for diminished value if the car was in a wreck while in their possession. One of the absolute luxuries of leasing was, regardless of what accident repairs were done during the lease period, there was no concern about being charged for the car's diminished value. A car that is owned suffers a similar loss in value once it is saddled with a repair history so that individual absorbs the loss amount personally. Finance companies were content to take back previously repaired cars without penalty but times have changed. Rental car companies have been seeking compensation - now the finance companies seemingly want their pound of flesh as well.
There is no blame to assign unless you want to beat yourself up for backing into that utility pole. Why shouldn't lessors receive the same consideration you do when a third-party damages your personally-owned car? Third-party inherent auto diminished value claims are now well-known remedies. An errant driver damages your car. After repairs the car certainly isn't worth what it was before going under the welding-torch so you make a claim against the car owner's insurance policy for compensation. Those of you who lease cars are now facing the same unpleasant fate as are the insurance companies.
When a Carfax or Autocheck Report shows that a car had structural damage or air bag deployment, a dealer can no longer certify a car, banks won't finance it and off to the auction it goes. When a leasing company sells an off-lease vehicle, any sensible prospective buyer will ask for the car's repair history. With just a little research, that buyer can determine just how much the previous loss affects the car and will make an offer accordingly. The result? If the car you were leasing had a fair market value of $40,000.00 and suffered damages as described, it will lose close to half of its value. Expect a bill for $15,000.00-$20,000.00 from the finance company. You may be able to negotiate it down by obtaining your own independent appraisal but, make no mistake about it, you are legally liable.[/QUOTE0
This is one reason not to use a body shop that reports to Carfax or any other tracking service.
That being said, I have never heard of a finance company going after diminished value once the lease is over if the vehicle was repaired properly. Not saying it isn't happening, but I haven't seen it yet.
We have clients turning in high-end lease cars who are being socked for thousands. The latest one was for $7,000.00 despite the Carfax showing minor damage.
Carfax reports aren't generated or abridged by body shops. The information all stems from what is on the accident report.
We have clients turning in high-end lease cars who are being socked for thousands. The latest one was for $7,000.00 despite the Carfax showing minor damage.
Carfax reports aren't generated or abridged by body shops. The information all stems from what is on the accident report.
Who was the Lessor? I'd love to see a copy of the lease contract as if they are going to pursue diminished value they better have it noted in the lease contract, otherwise I'd tell them to shove it.
Who was the Lessor? I'd love to see a copy of the lease contract as if they are going to pursue diminished value they better have it noted in the lease contract, otherwise I'd tell them to shove it.
Probably get that answer from any finance manager at a new car dealership.
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Can a finance company sue you for automobile diminished value?
