Filing a small claim(max 10k) as a full lawsuit would cost more than what I would be receiving. Legally the money has to be sent to me.
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Ahh okay, good luck! Hope it works out for you.
I’m having the same issue now. Totaled my 2020 BMW M340 in September. MSRP is $63,790 with a 36/month lease. Only used 18 months, which I’d owe the other half of outstanding payments. The residual is $38,274. Insurance valued the vehicle at $61,935. BMWFS told me the payoff amount is $47-$51k. That would mean that there’s an overage of roughly 10-14k! BMWFS is saying that I am not entitled to any of the overages because I don’t own the car; it’s lease.
Am I entitled to that money? If yes, how would you suggest I go about it?
This seems to vary by state and lessor.
Does your lease agreement address this? That’s the first place to check.
I’m in NYS. To my knowledge, the lease agreement doesn’t seem to address this specific stance.
Check again. I’ve never seen a lease that didn’t have a section that specifically addresses insurance payments in the case of a total loss.
It’s right there in your picture.
Section 26
If you owe money, GAP will cover it. And that’s ALL it says, it does not say they will give you back money on the other direction.
Well, it does talk about your obligations while waiting for the insurance proceeds to make their way to bmwfs. What does the section discussing insurance requirements say?
You need to talk to a lawyer.
Correct; but it doesn’t state anything about ‘overages’. Not specifically stating those words make a difference I believe; hence why contracts have all these stipulations and terminology. The lease agreement simply doesn’t address this.
Right so they can say they keep it OR you can say you keep it. But that’s why Lawyers get paid.
Perhaps because this market is one no one expected, autos are known as depreciating assets so, I am confident the manufacturers never thought it could happen. I could be way off, but maybe the specific language is not included because they never guessed that lessees could sell their vehicles and make a profit in droves (hence the stop to third-party buyouts). Someone else would have to chime in to let me know if this has ever happened before. That language will probably be standard moving forward. You live and learn - no one is immune (especially if this is the first time the market has allowed so many people to take advantage of new technology - i.e., an e-commerce that pertains to cars). I am sure if the dealership could refuse my check for the contract payoff in this market, they would burn it in front of me.
There is language specifically addressing this in every contract I have ever had. Some brands keep the overage, some don’t. Seems to also vary regionally as well. This is the first one I have seen that’s this ambiguous
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I remember there was another huge thread about this if you search the forums. The bottom line is a person leasing a car does not own the car and they have no “right” to take positive equity in the event of a total loss and insurance pay out.
That said, from what I recall, some people received the difference and some didn’t, depending on the insurance company and depending on the finance company.
I guess the bottom line here would be where the insurance company plans to send the payment. You could theoretically purchase the car by issuing the payment amount in full, as long as the insurance sends you the payout for the vehicle.
Other than that, best bet is starting with the insurance company to see how they are going to pay the claim and then working with the finance company. It seems more about luck then any particular legal right.
Some people most certainly do. They signed a lease contract that stipulates the insurance overages go to them. Doesn’t matter who owns the car, that’s the terms of the agreement.
Likewise, some people don’t because they agreed to a lease contractnthat stipulates the overrage goes to the lessor.
This case isn’t as cut and dry.
I stand corrected, but I myself have never witnessed a contract that said that. Doesn’t mean they don’t exist.
If I had to put some numbers on it, it seems to be somewhat 50/50 as to which way it goes.
Or maybe it’s more like 45/45/10 with that 10 not saying.
Thanks, I’ll check my two leases more out of curiosity than anything. 
That’s what I was told by bmwfs, but at the same time, other reps. told me otherwise - depends on the calculations if there’ll be a refund. Which one is it? In general, it’s a grey area. (Dealership is in NJ)
Besides, since the lessee is the one paying for the insurance, shouldn’t he/she be entitled to the overages?!
This is what Geico stated with the claim:
"Lienholder and Leasing Information:
We will require paperwork from your finance company before we can issue a check. This means it may take a little longer to settle the claim. Please have a discussion with your finance company about continuing any payments that you are making. Any total loss payment made must first go to your finance company.
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If your vehicle is worth more than you owe, we will then issue a payment directly to you.
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If you owe more than your vehicle is worth, you can talk to your finance company about your options."
They didn’t send me the check.