My first job out of college was writing, mass-producing and mailing junk mail for car dealers.
Great to see that it still works.
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Lol I got letters like that ALL THE TIME.
‘Dealer XXX wants your XXX car, we can give you a new XXX car for the same payment’
Then when you look closer at the letter at the bottom is this tiny 6pt font of all the legalese. Which usually translates to , we got your name but we cannot guarantee what we said is true or you need substantial down payment in addition to your trade in.
First and foremost, you owe all lease payments that you agreed to, there is no way around that.
Then the dealer has to buy it at Residual / Dealer price. So to get into a new car you have to subtract rental payments from Dealer offer add all that up together as a ‘trade in’. This is not a bought car, it’s a rented car, and you owe all rental payments. Even if you turn it in early.
So unless your car has gone through the roof in pricing I doubt they can do it and just want you to give some free money away to them. It’s like a IRS scam, but it’s a car scam.
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Please stop.
There is something called a payoff which includes all this which is remaining payments and residual plus some fees.
We are talking about the same thing. The Payoff still has built in the remaining payments.
It’s not like they go, oh the car is worth Residual + some number we make up. The Dealer will say to the person that, your car residual is what it’s worth or some crap like that.
That letter is just that, crap.
I have never gotten an unsolicited offer from a car dealer that turned out to be good.
Following up- I have been pretty busy with work and didn’t want to waste a lot of time on this, but couple of days ago I called the salesperson who sold me the S4 and told her about the letter and they were kind of clueless but replied “oh sure yes we can help you out upgrading”
Long story short they told quoted me close to $200 extra a month with more DAS and less miles vs my current lease which is clearly upside down for a ton of money and I owe 29 payments lol. It took me about 15 mins of my time between the two calls and it was even funny, nonetheless I mentioned how misleading their non stop correspondace is, which of course they didn’t care.
Worth noting I inquired for a S4 with similar MSRP as my current one. Didn’t want to inquire for the SQ5 as these are a little more expensive if I want the same spec.
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You’re misinformed as to how this process works.
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Please enlighten me. I am not aware of any case where the Buyout amount is significantly less than the payments remaining + Residual.
Of course there are variances but not anything beyond say 10%
Buyout amount typically is residual + the depreciation amount of the remaining payments, not the sum of all remaining payments. Further, to get into a new car, one only needs to deal with the delta between the current dealer buy out amount (which is not the residual value, unless at the end of the lease) and the dealer purchase offer.
Interesting, so the payments are depreciated as well.
Is there any LH topic that covers this?
No, you’re just not paying rent charge for months where it isn’t rented.
A lease payment as two main components (ignoring tax); the depreciation amount and the rent charge/interest amount.
The depreciation amount is the delta between the adjusted cap cost and the residual value, divided by the number over periods. You’re on the hook for this if you buy out the vehicle.
The rent charge is a monthly amount for holding the lease. Typically (but not always, so one should always verify), purchasing the vehicle early is not subject to rent charge for the entire lease period. Which makes sense… you wouldn’t pay a monthly rent fee for something you’re no longer renting.
Now, if you opt to not purchase the vehicle and just turn it in early, you’re generally liable for the remaining payments in their entirety.
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To put into perspective, if I sell the car probably id have to pay somewhere between 5-10K (carvana is around 8K from my calculated payoff) if I make the remaining payments and return to Audi id have to pay 18K (590 + FL tax 29 times), maybe 1K less if I’m able to get a refund on AudiCare. However at this point Audi would have to sell the car in a private auction and would refund me for the difference between the sell price and the payoff (believe it or not i got $300 back on my A4 lease that I retuned under miles and very well maintained) but this car probably would get me a few grand.
Most likely selling directly instead of doing that would save money and a huge hassle
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Thank you , so selling way early can actually lower the total beyond the 10% I was calculating due to the release of the rent charge.
I was thinking about the turning in the last few months, I have never tried to get rid of my lease that early.
But in the context of this thread, do you believe that Poster’s Dealer is really going to give a deal on a new car by trading in a 12m used car just because they ‘sent a letter’?
Do dealers really know all the ins/outs of the leasing process that they can calculate that the car will give such a great deal or it’s just part of the spam machine that goes into place when you get on their database?
Oh, it’s definitely not an invitation to a good deal and is just a spam letter.
Definitely I had near 0 hopes on this. My initial question wasn’t about the letter itself but more around if incentives are so good to offset negative equity and still give a good discount, clearly they are not. One way or the other some one has to pay Audi for what’s on my contract. But if they are able to give me a huge discount based on incentives and dealer motivation to reach goals the net new number may be lower than my current one as it offsets and surpass the loss on my 2019 S4.
When I say near 0 is because I’ve seen and done a couple of unicorn unreal deals and it’s possible just very unlikely.