Lease Equity

Gap is included in most leases. Moot point.

 

You get equity, when near the end of the lease the value of the truck on the used market is higher than what Toyota financial originally decided the projected value at the end of your lease term. Toyota valued my buyout rate at the end of lease for my 2017 TRD OR with premium tech at $25k at the end of 4 years. I know these trucks usually sell for $30K+ used so if I traded it in near the end of the lease I would ideally have between $2.5-5k in positive equity. Also not sure how they do it with you, but when I asked about making sure I had GAP, the finance manager told me that SETF included GAP in the cost of the lease since SETF (Southeast Toyota Financial) is essentially co-signing it in case there may be a loss that is incurred along the way.

Near the end of this lease, I have decided that I am most likely going to either trade up for a PRO Taco, a Tundra or an FX4 F150. Leasing when you understand the market can be quite beneficial, compared to financing. You get more for your money and you get more options near the end.

 

Niche' vehicles do not depreciate at a rate as rapid as regular vehicles. Thats why Tacomas, Jeep Wranglers and some certain tier models (Raptors, AMGs) have such high resale values. Even the options like 4WD help and trucks alone have an amazing resale value in comparison to a crossover or sedan.

 

Awesome responses^.

I am still a little confused on what options are available at the end of the lease. Let’s say my end of lease price is 28k. But I only put 15k miles on my tacoma... ( i don’t commute at all) so my market value price at the end of my lease is let’s say, 36k. That potentially gives me 8k of positive equity right?

At the end of my lease...

Can I put that $8k towards a down payment on financing it?

Or can that $8k be put toward a down payment on a new lease?

Thanks gents

 

You would potentially have a truck that is worth far more than what the lease agreement was anticipating. So, you could buy it out for your residual and keep it, or sell it. The dealer may decide to give you some of the extra value towards another vehicle.

 

I have never returned a lease. Most lease residuals are artificially low so that lease companies can resell them and make money again.

I leased a Tundra and before lease was up I sold it privately for $7,400 above my buyout. They hold their value really well up here. I did the same with the Forester and pocketed about $6,000. Dealer however offered only about $2,500 in equity as they wanted to make money on selling it. So yes if you have equity in your lease you could trade it in on a new lease and roll the equity in, but remember just like any other trade in, dealer wants their cut and you could get more selling it privately.

 

When I used to lease my daily driver auto, I sell them to CARMAX 2-3 months before my lease ends, especially when the miles are over 10-15k. I would always get my downpayment + more, since they don't have to pay taxes. Whatever is the lease buyout usually Carmax is around it, if not more than.

 

Putting money down on the lease simply lowers your payment. That’s it.

You can always do a zero down lease, your payment will just be higher. I try not to put more than 500 to 1000 down on a lease and that’s including first months payment tags and all paperwork fees. With that said originally they wanted 1500 down and a crazy high lease number for my taco, I talked them down to $500 down and a very reasonable lease payment.

And yeah, I’m hoping to have equity when I return my 2017 lease as well

 

How dumb is it to switch out the wheels of a leased truck?

Was sinking’ about swapping the TRD OR 16” wheels for pro comp 7032’s...

I’ve got 2.5 years left in my lease. As of now I am heavily, heavily considering buying it out at the end of my term... idk where you can find a 2017 TRD OR DCSB with full tech package with an estimated 19000 miles on it for $28k...?

Thus, makes me inclined to toss the idea around of throwing new wheels on it...

 

Just keep the stock wheels.

 

I'm leasing and thinking along the same lines. I drive low kms per year and there are no 5 year old Tacomas with 55k kms gooing for anything near my residual.

We'll see though. So far the truck has been a thorn in my side.

 

What’s the reasoning? Does it violate any lease obligations/or fine print?

 

Nope, but they won't give you any extra for the aftermarket ones. If you really want them, get them. But, keep your stock ones mounted up so you can toss them back on there at the end of the term.

 

Yeah so you don't need to worry about getting screwed by being upside down, but at the same time if your truck gets totalled you can kiss that $5k goodbye.

If you put $0 down and had gap insurance you've kept your $5k in your pocket and if your truck gets totalled you just walk away.

Thats why its generally advised to put minimal $ down when leasing.

Edit: But to be clear with $5k down you don't need gap insurance on a Tacoma. If it was a nissan or chevy you'd probably still want to get it though lol

 

Agreed with you on the leasing part but need to make a small but important correction: GAP insurance is NOT included on Toyota Leases. You MUST pay for it at additional cost.

This is different than say a HONDA lease where gap insurance is part of your acquisition fee.

With toyota you need to either purchase gap from the dealer (usually $400-$800 and rolled into your payment), or get it from your insurance company (usually like $5-$8/month). But you need to get it its not already included!

 

FALSE.

GAP comes on SOME leases like Honda and BMW.

GAP is NOT included on: Toyota, Subaru, Ford, Nissan, Hyundai, Kia, Chevy lease... and I'm sure many more.

In fact I can think of many more companies that do NOT include gap for free than those that do. You have it backwards

 

Mine is leased and I've added: Leitner bed rack, TRD FJ wheels, Magnaflow exhaust, RTT, rack, pro grille, HID lighting, window tint, about to vinyl wrap the hood and roof, gonna get the OV tune, pretty soon suspension etc....

But I knew i'd NEVER be giving this truck back to toyota so I'm modding away. 95% sure I'll buy it at the end of the lease otherwise I'll sell it private party, carmax, or even just trade it into my dealership. But giving it back to toyota was never in the cards.

Shouldn't be for you either so mod as you wish.

 

Leasing is simple, take the purchase price of the vehicle, minus the residual value at lease end. The result is what you pay over the term of the lease. You're not throwing money away; you are simply paying for the depreciation, nothing more, nothing less. In the case of Toyota trucks you usually pay more in depreciation than the truck actually depreciates, thus giving you positive equity at lease end. If you choose to buyout the truck at lease end you never pay more than the original negotiated price at time of lease start. That is you've paid depreciation plus buyout amount which equals original purchase price, the same as if you financed it from the get go. Now if you take longer to pay for it (lease years + buyout financing years) you will end up paying more in interest over a longer term, but you get the option to dump the truck for any reason you see fit at lease end

 

Now if I could only train my salesman to explain it this clearly.

Seriously most salesman barely know how t works lol.

 

Love it.

However, does swapping wheels for example, violate any lease agreement terms? I’m with you: about a 95% chance I keep the truck as well, BUT I want to know the consequences of a simple mod - in case there is a slim chance I give it back.