I had Charger that was financed that I ended up rolling into a GLI lease. I’m now at a place where I’d like to completely rid myself of this vehicle as I have another vehicle I own outright and the Charger was a luxury when I bought it. (It broken into a bunch of times, I wasn’t comfortable with the car anymore and thought I’d be happy with the GLI).
I’m only 4 months into the lease. The residual is $13,173.75 and I have $25,196.64 left in payments. Carmax offered me 19k, making my payoff a little under 11k. I slept on it and decided to pull the trigger, went to my bank and pulled a cashier’s check.
After sitting at CarMax for 2 hours, it was determined that VW Credit won’t sell the car to Carmax at the residual price, but at the “wholesale market price”, which raised my payoff an additional $7k. Everyone in the Carmax office was as surprised as I was, and didn’t have any experience with this practice either.
So, my question is, how do I get out of this lease for the 11k budget I have? My only idea has been to take out an auto loan for 19k, pair it with my 11k and buy the car from VW, then sell it to CarMax and pay the auto loan off in full, but that seems like a lot of work. Am I missing something? Also, will I run into this same issue trying to sell the car privately? I have the money available to cover the negative equity if I find a buyer, but I’m now concerned that VW is going to try to raise the price if anyone other than me is buying it, even though they’re getting the same amount of money.
I don’t think there’s a workaround. The lower buyout price is only valid for you. If the buyer is anyone else, VW will charge the “wholesale market price.”
I have always thought buy-out equals the residual at any given time contractually. Apparently not. I wonder this is true for all brands and banks or only for VW? Something to learn everyday…
Edit : I misspoke, I meant , Buyout= Residual+Remaining lease payments
Think about what you just said. So if you just leased a $60k vehicle, you would be able to buy it out after the 1st month for $30k (assuming RV of 50%)?
Based on the original post, residual + lease payments comes out to $38,xxx. If CarMax is offering $19k for the car, then isn’t the remaining amount that would have to be put up (out of pocket) an additional $19k? I’m ignoring the issue of which residual we use for now because the OP said he thought in the CarMax the OOP due would be $11k. So I’m wondering if there is some miscalculation or wrong numbers (or maybe I’m missing something).
You must really want out of this car to dump it + pay 11k for that privilege. I get that it’s cheaper that way than paying the 25k in remaining payments, but that lease cost you around 3k/month to drive it 4 months (and that’s not counting the extra $$$ Volkswagen wants). To each their own though.
This is really confusing. Where did the $11k number come from?
ANYWAY, what about a transfer? I have no idea what your payments are or how many months, but does offering someone $11k cash and they take over your lease make it at all attractive to someone?
As mentioned, VW requires the original leaseholder stay on the lease, so I’d still be liable if they took my 11k cash and ran with it. 11k is my residual + remaining payments. VW credit charges dealerships more to purchase vehicles.
Yeah, expensive lesson. I’m going back to school and my income will increase, but I’d rather minimize my monthly expenses and this vehicle is purely a luxury at this point. The money i’d save on registration + insurance makes biting the bullet worth it for me.
Don’t get me wrong - I don’t want to spend this much money, but it’s either that or stick it out for another 3.75 years, and, well, no thanks.
Volkswagen, Audi, and some others will not always sell your car for residual plus remaining payments to anyone but you. They can choose to offer a different price to a third party dealer (eg CarMax, caravana etc).
It was explained to me that payoff = residual + remaining lease payments. The residual apparently is only offered to me. If the car is sold to anyone else, they want an additional 7k. So it looks like my only option is trying to take out a loan for 19k, pairing it with my 11k cash and buying the car outright from VW to end my lease, then selling the car to a dealership (Carmax, etc) and paying off the loan. I’ve recently listed it on autotrader, so we’ll see what happens. I imagine encountering some apprehension at my situation. (Write me a check so I can pay the car off & get the title, then i’ll Transfer you the title). But then again, that may happen more than I realize.
