IDK why all these negative equity threads beat around the bush to tiptoe around the elephant in the room
Do you have the cash to pay off the negative equity, yes or no?
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He obviously does, otherwise he would not be looking at T8
How many people lease a car then soon after start thinking they should have leased something else, a lot. The difference is âmostâ people will just deal with it until it makes sense to get another car, this deal makes 0 sense to âmostâ people.
He is already entertaining rolling over 6k negative into another car so I donât think internet strangers are going to change his mind.
Some care about losing 6k, some donât, if you are fine with throwing away money, then there really should be no thread here because nothing is getting âhackedâ.
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I had a ~68k XC60 T8 that I got rid of after 6 months. It doesnât have the performance you think it does. Are you absolutely sure you wonât be happy with a T6?
The deal youâre getting from that dealer sucks, mine was 12k miles and $800/month including tax, 0 drive off. T8s are not moving and you should be able to get a much better deal. But for the same price you can get much more performance in like a X3MâŚ
If he obviously did, he wouldnât need to essentially take out a loan to pay it off.
But Iâll let him answer for himself.
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Someone even considering paying over $1k/mo for a car obviously has means, but yeah - let him answer.
Something isnât adding up in all of thisâŚhorrible incentives on T8âs so going for a bit of âwow factorâ when OP should be thinking fiscally. Compounding one problem into another doesnât make sense so if the funds are available just get rid of the xc40 as a mistake. Iâm assuming itâs OP wanting to fix the issue but the fix has to be a specific vehicleâŚif thatâs the case we canât help haha
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I am not concerned with rolling some negative equity into the next vehicle but am hopeful the federal EV credit could help cancel out most of the negative balance on a trade. Thats why I was looking at the T8 as opposed to the T6. I think the T8 hybrid design offers very little benefit over the T6 from a vehicle engineering perspective.
I understand the XC60 is only slightly larger than the XC40 but it does allow for more space when needing to transport a portable oxygen concentrator and oxygen tank. It is also slightly roomier when needing to fit 5 people in the vehicle at once.
As for my personal finances. I am honestly not sure why individuals are considering that for this discussion. I thought this was a community specifically dedicated to helping individuals negotiate lease deals and to share advice. I can confirm that as others have asserted someone considering a $1000+ lease monthly is likely not scavenging their couch cushions for quarters nightly and eating off the budget menu at Mcdonalds.
This also doesnât mean I am interested in throwing piles of money into a fire pit just to watch it burn. If you could go back in time and speak with me when I was in my 20s or even early 30s I probably would have said âwho gives a sh!t about 6kâ ill just toss it on my credit card and pay it off over 18 months at 0% interest, but my current self isnât that careless anymore.
Anyway, I shopped a few more dealers and found one willing to do a 2020 XC90 T8 with MSRP of 66k for $850/mo including tax, $1000 down payment, and that includes paying off the XC40. Not the best or worst deal I have seen⌠I am waiting on them to send me the full details so I can plug everything into the calculator and see what the result is.
It doesnât ever cancel it out though. No matter what the rebate, youâre now paying interest and tax on that negative equity amount. The only relevance a large incentive has in the conversation is if the bank will approve the financing. The large incentive allows that as it keeps the financed amount lower relative to the book value of the vehicle. Donât fall into the thinking that a large incentive some how wipes away the equity unless itâs some non-existent incentive that only comes into play when you do roll in negative equity.
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Through a different lens, what you said here reads as âI donât understand why people are giving me advice. I thought this was a forum where people go to get advice.â
People are commenting on your finances because a large part of getting a good lease deal is about making sound, educated decisions. The venn diagram of people that get into poor lease deals and people that make poor financial decisions has a lot of overlap. Anyone commenting on your finances is doing so to try to help see the forest through the trees. We get a lot of people that come here fixated on addressing a small problem and make horrible financial decisions to do so, spending dollars to save pennies.
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Understandable. But in my case, I wish they would instead focus on the factors that affect the lease deal and not worrying so much about other variables outside of the car lease.
Exactly why paying negative off outside of a lease is always better. Iâd recommend just swallowing that pill.
Can do. Letâs take it slow and simply evaluate the deal.
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I understand where you are coming from. We just look at it from different points of view.
If a dealer offered me a salmon pink colored vehicle for 5k less than a color I considered acceptable I would happily pay the 5k for a color I preffered.
Thank you 
Letâs try to calibrate your point of view then.
If you lease the xc90 with no trade in involved, your cap cost is X. If you roll in the trade in your cap cost is X + $6000. It doesnât matter how much the incentive lowers X, youâre always going to be paying X + $6000 if you roll that negative equity in and then youâre always paying tax and interest on that amount.
So you bought the xc40 and paid tax on it and now you want to take that post tax negative equity and pay tax and interest on it again, meaning that $6000 in negative equity is going to approach $7000 out of pocket to get rid of.
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The XC40 was a lease. No tax paid on it.
Well in that case, that $6000 in negative equity is going to cost you about $7000 to get rid of still.
If youâre just looking at the T8 because of that incentive and donât have some other compelling reason why you need it vs a T6, just price the two out and see which one has the lower total lease cost to see if that incentive is actually saving you money here.
This is a perfect example of spending dollars to save pennies.
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If you want my honest opinion, look for a 2020 XC90 T5/T6 loaner. Thatâll be the cheapest option, youâre not saving any money rolling the negative in, usually we recommend keeping trades separate.
When you put negative into a lease as weâve preached, youâre paying MF or interest on that, and spending money upfront unless youâre investing it in a high ass ROI method is just stupid.
I agree with @mllcb42 on his opinion though, however a conventional ICE Volvo will be best.
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Because, in addition to the actual financial cost of rolling in negative equity that Matt has tried to explain to you, this is actually not a variable independent of your lease.
When negotiating, perceptions are more important than reality. When you tell dealers you are rolling in negative equity, most of them will automatically stereotype you and lump you in with financially illiterate people who they see on a daily basis doing exactly that.
So your choices are to pay the negative with cash if you have it and make a clean start on a T5/6 or continue to push a boulder up a hill trying to get a good deal on a T8 with the negative rolled in.
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I hear you on that. I am no financial planner or CPA, but rolling in that much negative equity is not a good idea. It sounds like you are financially savvy so I am not going to offer any advice on whether you can afford a $1k payment.
What does the deal look like without the negative equity?
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