At Month 30 or 31 of Honda Lease - looking to sell back to dealer and get new lease. Newbie Questions!

Ask the Hackrs
1

Hello. I’m in a Honda CIvic and my lease ends in about five to six months. I’m looking to sell the Civic back to the dealer (thereby avoiding the penalties since we are already over on miles by 1.5K) and get into a new lease - preferably a CR-V.

I know this question might sounds stupid, but how would I go about talking about this to a dealer? Do I say I want to sell this back to you and get into a new lease? Or do I ask them to pay off the balance of my lease and get into a new one?

Thank you! And, if anyone is feeling generous with the advice, any words on how to avoid putting money out before I drive off with the new lease?

Thanks in advance.

Best,
Aaron

2

You have several options:

  1. Buy your car and sell it - If the value of your car meets or exceeds the payoff on your lease, you can buy it and sell it. Go to your local carmax and have them appraise it. Their price is good for 7 days. Check your payoff amount and compare.

  2. Ask your dealer for a Pull Ahead program. Honda sometimes has a $1000 incentive for trading your lease in early. If your remaining payments are under $1000 and you are over miles, I highly recommend this.

  3. You can absorb your balance into the next lease. This is the worst option. They will take what you owe and add it to the cap cost of your new lease. Essentially, you will still be paying your old lease off, but you will also be paying for your new car. If you like to pay for two cars while only having one, do this.

  4. Go to another brand and inquire about Conquest Cash. Porsche, for example, will give you up to 3 payments of your old lease not to exceed a total of $4000 to pay off your old lease if you lease one of their cars. Other manufacturers do this, although not to the extent of $4k.

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3

Thanks so much @jmg, I really appreciate it.

I’ve been approached by the dealership from which I leased the car several times about getting into a new car (purchase or lease). Would my point of contact back be to ask to sell the car back to them or just to “get into a new lease” (which is what I am currently leaning towards). Is there a more strategic way of doing it/phrasing it?

Thanks again!
Aaron

4

Every Honda dealer I’ve dealed with takes the car back and throws me into another lease. That late into the term, you should have some equity in it

5

I had a Honda Pilot on 24 months on a 36 month lease and the selling dealer gladly took it back for the buyout price I had owed on it.

They bought it because the older boxy style seems to interest those looking for the Pilot instead of the newer looking mini van look.

So after a quick call to Honda Financial, I got out without any negative equity and got into a different brand.

Guess Hondas sure do retain their value even on a lease residual!

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6

You should also get quotes from carvana.com and vroom.com to see if they will pay more than carmax or your local dealership. Lots of folks on this forum seem to be having good luck with these companies.

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7

Did you check the trade in value versus the buyout price? You could have negotiated some possible equity.

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8

@Haufinator forgive my ignorance, but what does equity do? Allow me to reduce the next lease payments by including it in toward the next car? Thanks so much!

9

@tqpolo sorry to be ignorant, but what is the difference between buyout and trade in and how might it affect the new lease process? Is one (buyout or trade in) preferable?

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If you payoff is $2k lower than what it’s worth, then the dealer can make a profit off that. Which will allow them to give you a greater deal

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11

CRV is pretty terrible to lease, lots of better vehicles for the money out there.

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@Haufinator got it. Thanks. When figuring out the price of the payoff, do i need to include mileage overage fees and early termination fees?

13

@joeblogs can you make any recommendations and am I right in reading into your message that perhaps I take my Honda Civic to another brand dealership? I thought it’s best to go to same brand dealerships. Thank you!

14

If you’re going to get another Honda, no. When you get your statement, call and get a pay off amount. Then use KBB value as a rough estimate to see if you have equity. If so, use that as leverage when working a new deal. Since the dealer is making money off the trade in, then can discount your new car that much more

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15

Try the online car buyers like vroom carvana etc, and if you have a Carmax nearby have them look at it. Call Honda and get your payoff too, then you’ll know if you have any equity.

16

Yes, something like that. It’s best to treat it as two separate transactions. First to trade in your old car and pay off the buy out. The second is negotiate your lease/purchase. You need to know your trade in value and your buy out. If the trade in value is higher, they can sign you a check for it or use that money as down payment for your next lease. Most of these even money trade in is because most people just happy to get out of their old car. They don’t know that the dealer is actually giving them a low trade in price and profit that money.

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@tqpolo thank you so much. I hope you don’t mind me asking, what if the buyout is more than the price given at appraisal by folks like Carmax and also more than KBB trade in value?

Even through I’m over my mileage, would it be wiser to move closer to my end of lease so that fewer payments are included as part of my buyout?

Thank you so much!

Aaron

18

@joeblogs and if I don’t have equity, is there a “best path” from there (recognizing, of course, that this is far from ideal)?

19

Sign and drive($0 out of pocket) or just first payment. Have them cut you a check back for the remainder, or all of it in the case of sign and drive.

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@joeblogs sorry to ask, but if I don’t have equity, what would they cut me a check for? Thanks for all your kind help.