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Smart Shopper Smart Shopper-Archives Lease Questions - Ask Here 
23872 messages, Last post on Sep 20, 2005 at 8:08 AM
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Moparfan2, assuming that you are not over your mileage limit and that your vehicle does not have any excess wear and tear then yes at the end of your lease you could just turn in your vehicle and walk away without paying any money. In fact, if your vehicle is in good shape and you paid a security deposit at the beginning you should get that money back in full. This assumes that your lease does not have any "disposition fee." A disposition fee is much like an acquisition or bank fee that a bank would tack onto your lease, but instead of at the beginning of your term it is at the end. Car_Man Smart Shoppers / FWI Co-Host |
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| is there a significant difference between leasing and buying as far as deductions go? I am a small business owner and 75% of the use is for business purposes. | |
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I am currently leasing a 99 Explorer (Open ended Lease) for 5 years. I leased it in Jan of 99 so this is going to be my 3rd year. I don't know why I did such a thing. One, leased it for 5 years. Two, leased such a bad car (having 4 recalls in the first few months). Plus having to deal with the Firestone thing. I want to get out of my lease. How and what can I do to get out of it? |
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I thought those were an almost extinct breed. It's my understanding that you can get out of an open-ended lease anytime. Check your payoff amount, sell the Exploder for that number and pay off the contract. A sale price less that the payoff comes out of your pocket. The 'benefit' of open-ended leases was supposed to be that you could build equity in the lease if it was worth more than the residual at maturity. The amount over the residual went in your pocket. Problem is most vehicles aren't worth more at maturity, they're worth less, so the difference comes out of your pocket. The sad part about 5 year leases is that you end up paying for almost the full amount of the vehicle then have nothing to show for it. That totally negates the advantage of leasing which is driving a specific car for a limited amount of time for as little money as possible. What are your choices? Well, you can stick it out the whole 5 years. I hope to God you're not over miles. Or you can try to buy out your contract, sell it to someone (slim chance) or do a normal finance, in essence converting your lease into a purchase. Maybe someone else has another idea or two. |
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The buyout on my friend's lease is $21,110. The lease dealer will pay her $27,000. She wants me to be able to buy her purchase option at $21,110 from this lease dealer...but the dealer says No because they can only sell it to her.I wanted to be able to purchase for cash from the dealer and pay her the difference. But the lease dealer states that they will sell it to me only if I finance it through them. Does anyone have any knowledge about this situation? |
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| Hi Car_Man: I have been reading many of the posts regarding leasing cars and applaud your willingness to help those of us in the dark. Hopefully, one more round of neophyte questions will not upset you. I am leasing a 2001 Honda Accord Coupe. I have never leased before. I obtained what I believe is a wonderful deal (since another dealership said WOW what a wonderful deal). The basic numbers are 36 month, 15,000 mile, tax included (not sure if GAP is included) for $256.80 per month with $4,500 down (my choice) plus my trade ($800). Having read many of the remarks in this forum, I know that I need to check out the CAP COST, LEASE MONEY FACTOR, RESIDUAL VALUE AND EXCESS MILEAGE CHARGE. However, I have NO idea what those numbers should look like. Can you provide your usual insight on this please. Thank you and happy holidays. | |
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Car_Man, I am considering a lease on an '01 Silhouette Premiere. I am getting a price quote of right at $30K, but I haven't started haggling, yet. My question is this; what is the mf and lease rate from GM right now? Also, are you aware of any lease support being available? Thanks, SST |
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It's sounds to me that your friend wants to sell you this car for $27000, and her payoff is $21110. And you want to buy it for $27000. Is this right? If so, it should be a simple deal. She has to payoff her outstanding loan to her finance company. I hope the $21,110 includes any fees or penalties especially if its an early lease termination. I'm assuming you already have financing arranged for the $27,000 and that you are buying, not leasing, this car. If you're already approved for the loan have the bank cut a check in the purchase amount ($27,000 plus tax and whatever fees). I see no need to involve the dealer since the transaction is between you and your friend. Of course they want to finance it to you but anyone can bring their own money. My gut feel says I'm missing something........... |
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Hi kmowens I answered your identical question in topic 571, so please check there. Bretfraz, yes you misread what is going on. kmowens wants to buy the car at the payoff price of $21K. The dealer can only accept $21K from the lessee, but they value the car at $27K to any9one else. kmowens thus wants to buy the car at a $6000 savings. kcram Co-Host - Smart Shopper & FWI Conferences edmunds.com Town Hall |
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Thanks for the kind words, phantom522. Well, the first number that you should find out is this car's capitalized cost. The capitalized cost, or cap cost as it is commonly called, is essentially the amount of money that you are paying for this car. As you can imagine, the lower this car's cap cost is, the better the deal that you are getting, and the lower your monthly payments will be. Make sure to look at this car's cap cost prior to the deduction of your down payment. You will also need to know this car's full MSRP. One good way to tell if you are getting a good deal is to compare the car's full price, its MSRP, with its cap cost, the price that the dealership is essentially selling it to you for. Although the cap cost and the MSRP are probably the two most important figures, if possible you also should also find out the lease money factor and residual value that are being used to calculate your monthly lease payments. The exact lease money factor for this car will vary depending upon whether you are leasing a 4-cylinder or a 6-cylinder model. Right now, American Honda Finance Corp. has special lease money factors on 2001 4-cylinder Accords that are equivalent to just over 6.6% interest for 36 month terms. However, if you are leasing a 6-cylinder model and are going through AHFC, you will have to use their standard lease money factor which is equivalent to an interest rate of about almost 8.3%. As far as residual values are concerned, the 2001 Accord's 36 month 15,000 mi/yr AHFC residuals will be between 57% and 60% again depending upon the exact model that you are leasing. If you are able to come up with any of the aforementioned figures and would like to bounce them off of me, please feel free to do so. Happy Holidays, Car_Man Smart Shoppers / FWI Co-Host |
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