I am buying out a lease from a third-party leasing company. They told me they need my license, registration, insurance, and a photo of the odometer reading. I went over the the allotted 36,000 miles (I’m at like 36,400). But my understanding is if I buy it out they shouldn’t charge me for the additional miles. Why would they want to know the odometer reading and can they charge me for the additional miles if I buy out? Can I just give them an older photo of the odometer from a month ago since there are no dates on it? They did say that they don’t need to physically see the car at all.
They need the odometer reading to process the title transfer. That is customary. They should not charge you for additional miles.
8 Likes
Correct. In pretty much any state in the nation, odometer reading is required at time of title transfer from one party to another, they are literally requesting this because it is state mandated.
I have had to do the same for my lease buyout.
2 Likes
Thank you all for answering! Greatly appreciated. Two more questions I have is when I have bought out the lease (financing), do I get the title or does it have to be fully paid off to the bank? Can I also “sell” it to my brother, as in he pays out my loan and the title gets transferred to him?
My brother wants to buy this vehicle but my leasing company will only sell it to me and no one else.
You will get taxed on residual value of lease buyout and when you transfer title your brother will pay state sales tax on sale price/market value of car in most states.
If you buy the car out with a loan in New York, you will get the title, but it will show that the bank has a lien on the title until the loan is paid off.
One idea to explore is for you and your brother to jointly buy the vehicle from the leasing company, with the loan only in his name. Having two parties on title is not uncommon (spouses, parent/child). Once you buy the vehicle, drop your name from the title. That might avoid having to pay sales tax twice.
The sale between immediate family members might be tax-exempt depending on the state.