160k miles in 3 years means an average of 146 miles per day. That’s literally every day including weekends and holidays. If this were a commuter car, you’d have to drive a 200 mile round trip commute daily to put on that many miles! That’s a lot of driving. I can’t imagine driving 3+ hours every day. But that’s why I could never be a taxi or delivery driver.
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You’re forgetting, Uber/Ubereats, Door Dash, Lyft?
Could very possibly be that.
I’ll do you one better, my dad leased a 2015 accord and put 230k miles on it. Bought it out at the end, gave it to me.
I put another 10k on it waiting for the engine to crap out so I could swap in a low mileage junkyard engine, but it still runs like new! Apparently he was very religious with the oil changes and filter changes, so I switched out the spark plugs. Only thing I have left is a broken engine mount.
This i4 is seriously bulletproof.
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With that kind of mileage I assume they were doing something business related. (Even though that’s a violation of the lease agreement but one problem at a time.)
I mention this because they could probably write off a substantial portion of this. That would soften the blow.
Off the top of my head, amend taxes for last three years and get a refund since they overpaid. This assumes they wrote off none of it.
Talk to an accountant for more details.
If you were Kia and knew how many miles were on this car, would you negotiate the price with the customer?
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In a world with perfect information and no transaction costs… absolutely. No bank is going to write a loan for this car since it’s worth a fraction of the buyout price. And I highly doubt OPs “family member” has a 13k in cash lying around. So the most likely outcome is family member dropping car off and not paying buyout or overage. Kia would do better negotiating something like continued lease payments for next three years.
Of course, that is wildly impractical and banks make a lot of money on the tail end of leases with overage charges/people buying out cars to avoid returning them therefore allowing banks to avoid a charge for the inflated residual value.
OP just needs to pray for a fender bender. Will not take much damage to total this car out.
That 2.4L is a beast. Was that a CVT as well?
Also, couldn’t a Kia dealer purchase the car from the bank (if it is captive) for a lower price than the residual? There is little leverage buying the lease outright, but finding an aging unit on a Kia dealer’s lot with enough discount might get you into another car that you could get a loan on even with some negative equity rolled in?
After reading all the posts In my opinion the process is as follows: call the leasing company and extend the lease as far as they will allow. Could be another 6 months probably. Get an accountant to include the expenses and amend taxes, hopefully getting a few dollars back. Prepare a hefty down payment so a bank will finance the Rio. Save up as much cash as possible. Buy out the car. Then drive it til it dies or sell and get a car that you can put 50k miles per year on. I suggested the TDI Passat because it’s inexpensive, comfortable, and gets 35-40mpg if diesel. (there’s a big markup for “certified” Passat but in this case it’s worth it due to the 2 year unlimited mile warranty)also note that these have been off the road since 2015 or 2016 meaning that they are very low mileage. I found one near me with 30k miles for $11k. Or you can find the cheapest Jetta tdi with 80k miles and buy it for 7-8k. In either case you’re going to have unlimited mile warranty so no expensive repairs for 2 years will provide stability while you deal with the negative equity in the Rio and get finances in order
They say Corona will cause an enormous amount of used cars on the market, lenders may reconsider their lease end policies. Like previous poster said, extend the lease and see.
Did they know it was a lease? Wouldn’t you think once they hit $36k, 40k or even 50k miles they would either get a second car, buy more miles at a discount or figure out other options for commuting?
He was doing Uber, not a violation of the lease contract but obviously he got a bit carried away. As far as tax implications, pretty much all those miles were work related, so I imagine he wrote off most of the miles - though I’m not a tax expert on that kinda mileage or depreciation.
Does it even matter? At that point it’s better to just buy the leases car out than buy another car and put 120k miles on it? The smart thing would be to realize that you’re gonna get hit with a huge bill and just stack bills until its a non-issue.
It was more of a rhetorical question. If I were in OP’s shoes and I let a family member drive my leased car, I would be checking the mileage. What’s done is done.
I do agree it is better to buy out the car, but as some have said, it will be nearly impossible to get a regular auto loan. Hence, OP might have to get a personal loan.
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Buy it out and drive another 160K for the next 3 years. Stationary parts should have a lot less wear and tear compared to ten year old 160K car. Replace worn out wear and tear parts as necessary. Assuming engine and transmission will be ok until selling, the owner will probably have one of the best utility value of most car owners including leasehackers with “great deals”.
The best part about uber, by the time it’s all said and done, you’re lucky if you make $10/hr!
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I’ll second Lightstream. It is an unsecured loan, as long as you have decent credit. Their application is odd because they’ll ask you what its for, but then put the money in your bank account and ultimately don’t care to see the car/title/etc.
I would still at least give a shot at calling HMF and asking what they’d offer as for the buyout. Obviously, don’t tell them the miles that are on it. Probably not negotiable, but it never hurts to ask. This obviously needs to be bought, no matter if the buyout is $13k or less. Just no choice here.
Yeah, but you need good credit, like really good to get lightstream loans. I got auto approved for Tier 1+ or whatever the best tier is for BMW, and Lightstream asked me for stips. This was for a $15k loan for a car - that I could’ve paid for cash and I had a ~780 credit score.
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just read all the replies…yikes. Lol at “family member” y’all are funny. I’m just trying to help them out in the least painful way possible. I didn’t know about their situation until they were already at 130k miles, and like many have mentioned, yes it’s used for uber.
They should really just pray to get rear ended is what i’m gathering. That or pay 15k bc the credit score for a loan isn’t good enough to get a decent rate either. Hopefully they learn their lesson it’s insane to me that 160k miles in 3 years is even possible.
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Yup, Lightstream is a no go. They don’t give loans to anyone under tier 1.
There are likely some banks and CUs that give loans based on the model year and not the mileage. I had a CU that did this years ago. That may be the best bet.