Advice needed on potentially getting out of lease

Ask the Hackrs
1

Hi all, I’ve been lurking but not very active since October of 2019 when this site helped me with my first lease - a 2019 Ioniq Electric Limited.

At the time, I had no intention of getting a vehicle like that and actually came here looking for luxury SUV options. However, when the option came up and I looked at the numbers, the Ioniq made a lot of sense.

I ended up signing on for 36 months, 36,000 miles at $172.44 per month with nothing but first month due at signing. At the time I was driving about 9k miles per year just to and from work and had the ability to charge for free at work. The gas savings alone from not driving my truck covered the lease payment, not to mention the more comfortable ride and reduction in wear and tear on the truck and it’s expensive tires and oil changes.

Anyway, 5 months to the day and 4K miles after taking delivery, COVID came along and I commuted to work for the last time. Now it’s 10 months and 1k miles later and the car sits most of the time. I also just learned that I will be working from home for at least the next 6 months. With the commute continuing to be out of the equation, I see myself driving the car no more than 500 miles over that period of time and I could easily just shift that over to my truck. This makes me question whether I should continue paying for a vehicle I’m not using.

I’ve requested quotes from Carvana, KBB, etc a few times over the past few months and the numbers were never great. I just checked again, and they’ve gotten much worse. The exception is VROOM, but I feel like this is an indicator that now is the time if I’m going to get out.

My payout is $21,578.42. VROOM offered $19,961.00. This leaves me upside down by $1,617.42. I’m not thrilled about paying money to give up my use of the vehicle, especially considering it started out at as such a good lease deal. But, I also feel like I’m throwing good money after bad if I keep it. Between the lease and insurance, it’s costing me $231.90/mo for the car to sit in the garage. Assuming I return to the office in 6 months, it’ll cost me $1600 to keep the car sitting until then, which is a wash with dumping it. The obvious difference between the two is that in one case, I still have the car and can continue to drive it at a cost of $232/mo. But, there’s also the possibility that I won’t return to the office or at least not full time, and at that point there is no way I’ll have enough value to get out for less then the remainder of my payments.

In summary: I know I won’t be driving the car for at least 6 months and during that time I’m going to have to shell out $1600 no matter what. If I keep the car, I’ll be guaranteed the ability to continue to drive it in 6 months at a very reasonable price, but I may end up wasting more money if I don’t start driving again. If I dump it now then I lose the guarantee of a low cost vehicle, but I eliminate the concern of continuing to throw away money and gain the option to try to get a good deal on a new vehicle. Even if I can’t get a deal, I do have a vehicle to drive so I won’t be stuck.

If you’re still with me, what would you do?

3

Is that payout your dealer buyout without taxes, or a retail buyout quote?

Also, does the bank you leased with not allow transfers?

4

Hyundai financial doesn’t do lease transfers

1 Like
5

the break-even on turning it in or keeping it is 7 months, and you don’t know if you’ll return to the office for 6 months. Hyundai leases can’t be transferred. Do you have the $1600 now to make the Ioniq go away, if you decide to do that?

Did you claim any rebates that you’ll have to pay back? Extended warranty or finance products when you leased?

Does CT offer pro-rated refunds on registration?

2 Likes
6

This is very good point on rebates that might have to be paid back. OP personally I would just pay and get rid of it now.

7

Good question about the rebates. I need to go back and look at everything that was included in the deal. I know there was the federal EV rebate and then there was some CT EV rebate. I don’t know if they require me to keep the car for some period of time so I’ll need to check on that.

I have the cash to pay off the difference, that’s not a problem.

I also didn’t realize that the payoff amount possibly included sales tax, and that a dealer may not need to pay that. The quote from Hyundai says that they charge tax in CT, and looking at it closely it appears that it is included. If I add up my remaining payments and the residual plus tax, I get a number around $100 higher than they quoted me. Without tax, though, it’s like $1000 less. So, if VROOM doesn’t need to pay tax, then I may only be ~$600 underwater, which would be even better.

1 Like
8

See gets better. Saving money or spending less. When the next leasehacker meeting happens you can buy a round. :slight_smile:

9

It’s a lease so there was not a federal rebate. There may have been an incentive from Hyundai in an amount equivalent to the federal rebate, but that isn’t the same thing.

State rebates typically are the ones that require repayment, as they usually have 3 year minimums that you must hold the vehicle. This varies by state of course.

1 Like
10

Yes, correct. The tax credit went to Hyundai and they offered a discount equal to it.

12

If we are discussing a matter of semantics, which because it’s the topic of minimum holding time we are, no one gives the federal tax rebate, because they can’t. They can offer an incentive of equal value (which I believe Hyundai does here).

1 Like
13

I realized after I posted. Technically, yes. That’s all correct.

14

Ok, so it looks like I’m on the hook for a prorated portion of the CT rebate in the amount of $562. That changes the math a bit, unless the tax in the quote goes away.

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15

Btw in the meantime check with your insurance, they might have an option to have a “parked vehicle insurance”/“pay peer mile” (or whatever it’s called) for a lot cheaper …

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16

covid is mutating, u could be wfh much longer than 6 months

18

who knows what the side effects are, americans are damn afraid of getting shots too, so forget about getting americans to get the shot twice, and the shit is only good for 6 months

who knows how effective the vaccine is too

1 Like
19

Agreed, but before this spirals, lets go back to helping OP get out of his lease.

20

True. I really don’t know what the future will bring, but I’m trying to hedge my bets. Even a few months ago I thought we’d be going back sometime early this year. But, my company is being very cautious. Overall, things have been going very well once they changed course a bit and got all the new policies in place, so they’re not eager to change anything. Before we broke for Christmas they announced they won’t be changing anything until at least the 3rd quarter, and at that point they are going to do what they can to work around our individual needs and evaluate potential permanent WFH for those where it makes sense.

21

In case anyone is curious, I decided to accept the VROOM offer and kick off the process. They should get back to me by the end of the week with the real numbers based on the payoff they get from Hyundai. If I have to pay the $1k in sales tax I’m on the fence now in light of the rebate payback discovery. If it comes back that I don’t and the total I have to come up with is closer to $1200, I think I’m going to pull the trigger.

3 Likes
22

Well, it’s been 4 days since I accepted the VROOM offer and sent the requested documentation. That night they sent an email asking for my license (which I had already uploaded). The email was riddled with spelling errors, didn’t address me by name, and wasn’t signed by a person. It was pretty unprofessional, but I figure they’re probably dealing with a lot of volume and cut them some slack. I tried getting in touch yesterday and got nowhere, so I don’t think this is likely to happen. I just wish the Carvana offer wasn’t so low because it seems they have things together much better.

23

Did you try ALGo. They tend to bid higher. I sold a kia lease to them back in November and was very happy