Lease Turn In Advice

When I was considering buying out or walking away from my 2016 Lease, it was free to walk away. But the purchasing dealer wanted $1500 to process the buyout. Ended up doing the buyout through another local dealer for $150 and an hour of my time on a saturday.

 

Op, the good news is that you have some time from now until October.

This is a simple math exercise. What does your paperwork say the residual value of the vehicle is at the conclusion of your lease? Separately, what is the Blue Book (or even the CarMax / Carvana value). That might give you a good strategy for what to do as you get closer to the end of your lease. A Tacoma with low mileage might open up some possibilities for you to make a few thousand here.

Aside from that, get the truck repaired. I personally would use Toyota parts but that is just me. If you decide to buy the truck and flip it you will want to have that done and out of the way regardless.

Good luck ... and be sure to report back what you decide to do and how you make out. Your experience will add value to others that come after you !

 

Ahhh the memories.....my one and ONLY lease was a '99 GMC Sierra Z71. '99 was a complete refresh for GM trucks (bad idea #1). I leased it for the worst reason imaginable, I couldn't otherwise afford it (bad idea #2). I think the financial gods were punishing me for extreme stupidity because the truck was the worst piece of junk I've ever owned(rented is a more accurate term). Was constantly in the shop for something, to the point I attempted to get GM to take it back. They refused, and were real a**holes about it, as I recall. The only concession I got out of them was to extend the B2B Warranty to the end of the lease (45K miles). Was never happier to see a vehicle out of my driveway. I still have the 3 Ring Binder with all the warranty repairs to remind me to never buy GM and never, ever lease a vehicle again.....

 

I inspected lease returns for many car brands for nine years. . At the time it was cheaper to pay the lease companies repair costs than to have the car repaired yourself. I retired in 2012 so don’t know if that still applies to today’s leases.

 

Right. Dealers have people who can do that work on staff ... or access to places that can do it cheaper. Unless you have a friend who does good work on the side type of thing. Also, I guess it depends on how much they also charge for the damage.

Question for you ... based on your background. Do you have any thoughts on whether or not it makes sense to buy the car and flip it as opposed to just turn it in? Seems to me that there is more of a market for that now but would be curious to get your thoughts.

 

For me it would not be cost effective to buy out a lease as I live in Commifornia. I would have to pay the taxes (9%)and doc fees which would amount to several thousand dollars.

 

That isn't how it works. I bought out 2 other leases last year, and took advantage of Covid spending, and made out really nice on the sale. "Commifornia" gives you time, for you to buy out lease and sell immediately to 3rd party - whereas they have to pay the doc/taxes. Now the question is it worth it for you?

For me it was. Tacoma +2 other leases = $9,100 back to my pocket. If I turned all 3 in, I would spend additional $1800 for the 3 disposition fees. Math worked out in my favor, YMMV

Of course for me its all section 179

 

My 00 silverado went 176k miles without a real repair. And leases are done completely different from how they were 21 years ago.



That being said, i wouldnt buy a new GM truck either.

 

What is COVID spending?

 

People sitting home, looking online, and buying things they don't need, with their HELOC, PPP, and $600 additional weekly money fund.....and as a result creating huge demand, and thus overpaying for things

 

For the record and someone please correct me if I am wrong. Some people here seem to be alluding that if your buyout or residual is higher than the vehicle’s worth, then you must pay the difference to the leasing company. This would be only if you turn the lease in early. Much like a repo.

 

How do you buy out a lease with no money out of pocket than turn around and sell it?

 

I am not sure I said, or even alluded to buying things with "no money out of pocket"


Residual on 18 Tacoma was $17500. Gave Toyota a check. They sent title. I sold 3rd party, 21,000. 21000 - 17,500= profit + (not having to pay 600 disposition) = more profit

In CA, you are allowed to payoff your leased car in order to resell it without paying taxes on the payoff IF you can sell it back and to a third party which would need to register the car within ten days of the original leasee recieving the title form the lessor company.

 

You never had the "Intermediate Steering Shaft" replaced? The '99 had it done 5x in 45K miles. In turns it felt like something was loose in the steering system. Never got any explanation other than "Bring it back in the next time."

 

By out of pocket I meant without paying taxes or doc fees? Ok! Now I get it. You dealt directly with Toyota. The dealer didn’t handle the transaction.

 

When I sent toyota my payoff residual, I received a title in the mail. That title was then transferred to 3rd party, who paid me for the truck. 3rd party went to DMV, registered truck transferred title, and paid all fees and taxes (TTL).

There is no reason for me to pay sales tax, and TTL. I WOULD have to, if I kept the truck for myself, which I didn't do.

 

Got it! Thanks. Last time I bought out a lease was 1985 and I kept the truck.

 

Welcome, Jim. Good luck

 

Do you guys lease through the dealer or go through a third party leasing company. Any difference? Looking to lease later in the year.

 

Depends on the vehicle. Sometimes Chase/Ally will run incredible deals. Sometimes you will have to go through TFS. Pays to shop around. It is region, model of vehicle dependent.