I’m sure many of you have had to deal with this situation. I’ve had to do it one other time. The dealership WAY over valued the vehicle I just gave it back to them. Anyhoo, here are my questions.
The lease was for 45k miles, and I only have 24k on it. How do I calculate the the value of the over payment? Do I get refunded what I’ve over payed? Can I put that towards the down payment if I decide to buy? Will the dealership lower the price of the car based on that amount?
A more personal question. My credit was better three years ago, and I may have trouble getting a loan now. Anyone in the Atlanta area know of decent financing options?
Mods, if that second question is not acceptable on SDMB, please take it down.
I’m not sure if you can negotiate the residual value based on lower than expected mileage.
I’m currently leasing a car with traditionally VERY good resale value, and I’m putting far less miles on the car than the lease allows (I’ll probably end up in the same neighborhood as you when the lease ends).
As such, I plan to take the option to buy the car after the lease ends. If I want to keep it at that time, I will, but if not, I’ll sell the car for quite a bit more than what the residual value is.
I’ve also never heard of them crediting back for using less than the mileage allowance. That’s only relevant if you’re turning the car in at the end, though. If you buy it back, the mileage doesn’t matter. The buy back price is the same regardless of how many miles you put on the car during the lease term. The car will be worth slightly more because of the lower mileage, so it’s a little bit better deal for you, but other than that nothing changes.
It might actually help a bit with the financing because the lower mileage affects the value of the car but not the amount you’ll have to borrow, so your debt-to-collateral value ratio will be a little lower (which has the same effect as a down payment.) Although these days 21k miles isn’t usually going to make a huge difference in the value of a car.
Unless the lease agreement is unusual, you get nothing for the mileage “remaining” on the lease. You might as well ask if you can have some rent back because you didn’t use the extra bedroom in your apartment. It’s one reason why leases are poor options for most buyers. You can throw it out in negotiations, by all means, but as far as the dealer is concerned it’s unlikely to reduce the purchase option price. If anything it will increase it - after all, the car is worth more for resale to a third party.
Is there actually anything to negotiate when you buy back a leased car? I’m under the impression that the buyback price is usually written into the original lease terms.
It is, but it is (or at least was) almost invariably less than you’d pay for the same car on the normal used market. Most people will pay a premium for cars they’ve driven from new, though (it’s only your boogers wiped on the bottom of the seat), so people still buy them back. Thing is, if you don’t purchase at the buyback price you can still negotiate your own buyback price. Your money is as good as anyone else’s and (I’m assuming here) the dealer’s costs are probably lower if they sell it back to you versus some other guy.
A little googling suggests that used car prices are extremely high right now, though, so the buyback price may actually be lower than market.