I have a 2018 Jeep Grand Cherokee Limited lease through US Bank. The lease was not bad ($400.8/mo with $46,500 MSRP and zero drive off 10k/year). I did not research US Bank lease when I signed it two years ago.
Now I have 11 months left for my lease but I really want to get out of this lease and possibly get a Tesla Model Y (I did not really enjoy the Jeep in the past two years). I only have 13,500 miles on this Jeep and my customer buy out amount is $31,795 ($28,764.2 + tax and fees).
I got appraisal from Carvana for $31,500. However, after a few phone calls with Carvana and my research on Leasehacker I found out selling to Carvana is not possible with US Bank.
Then I went to a few local dealers and they were able to offer $29,500 to buy it. Weird thing happened… there is one dealer called US Bank and was informed the buy out amount is $30,280. I hesitated, and went to another dealer yesterday and they were able to offer $50 more. I did not want to make a few extra trips to dealerships during the pandemic so I accepted the appraisal and continued the process.
The dealership called US Bank and was informed the dealer buy out amount is $31,110.25 for them and my responsibility is $4803.8 (11 remaining months payment + $395 termination fee) WTF! On top of that I will need to pay the dealer the difference between what they had to pay US Bank $31,110.25 and what they are willing to pay me $29,950…
It absolutely not making any sense. why do I need to pay all remaining 11 payments and they still sell to dealer at a higher price tag?? Why do the two dealers got different pay off amount??
So… now I need some help from you… let’s say I go back to the other dealer and ask them to buy it and I pay the difference. Since US Bank did not mention anything regarding the remaining 11 payments… can the dealer simply send the overnight check and continue the pay off process??? will they eventually come back and ask me to pay the 11 payments? Are there any suggestions in terms of dealing with US Bank leases?
Most likely since they’ve mentioned this to you. It may be easier to go through your lease agreement and see what it says specifically for an early lease termination.
If you sell your car to the dealership and they pay off the US Bank lease for whatever the dealer payoff is, then you most certainly DO NOT have to also make the remaining 11 payments + disposition fee.
Your only responsibility is to cover whatever the difference is between the payoff and whatever the dealer is offering you on the trade.
As soon as the dealer buys the car from you the lease with US Bank is done. Over. The dealer owns the car at that point.
It seems the dealer you’re selling the car to doesn’t understand the in’s and out’s of a trade in that’s leased, etc.
That is how a lease works my man! You owe the money for the whole lease term once you sign the lease agreement! For example, In a 24 month month lease, if you want to get out of the lease after 12 months, you have to pay the money you own for the remaining 12 months and return the car to the dealer.
If you are selling it to a 3rd party, your payoff amount is the remaining months payment + Residual value.
If you had a good deal, most times the payoff amount is close to the current market value, in that case you will not be paying anything.
There’s more to calculating your current payoff than simply adding your remaining payments to the residual value.
Sorry but getting a good deal has zero (ok, very very little) to do with how the current market value of any given car compares to the current payoff value of the lease months/years down the road from when the lease was signed.
In any event, for ending the lease early the options are A) pay remaining payments & dispo fee to US bank and just turn the car in, or B) sell car to dealer and pay whatever negative equity difference you have between the payoff and trade in value.
It should be either A or B, not both, which is what this dealer seems to be asking for.
That’s not what OP is doing. They are selling it to a third party, not returning it. In this case the current buyout, not RV, should satisfy the remaining payments
Yes the problem is the residual is only about $25k towards the end of the lease but USBank wanted full remaining payments PLUS the “current fair market value”. That’s double dipping for sure.
your payoff today (roughly RV + balance of payments, less any discounts)
third party payoff today (roughly RV + balance of payments)
Depending your state, taxes can very (eg they might not charge tax on balance of depreciation + rent payments, but will tax the transaction amount at the time you buy it out).
They should be able to itemize for you (which if you want help on the variance, we would need). And they will be different.
Hi dan, you sound both like my bank (ally) and my dealer (Chevy) who both were clueless and I was left with an unanswered question for my buyout on my leases vehicle.
Dealer says easy, remaining payments + residual is your buyout.
Ally says nothing but online they provide me a quote that doesn’t make sense either.
That’s what I’m trying to ask…
I don’t know if the first dealer understands how it actually worked or they are the one don’t understand the US Bank…
So basically US Bank told the first dealer a lower payoff amount $30,280 and did not mention the remaining payments. But they told the second dealer with a higher payoff PLUS asking for remaining payments.
I want to know whether or not US Bank still charges me remaining payments if I proceed with the second dealer… I asked US Bank that the only way to avoid the remaining payments are to buy out directly by me or do a trade in. In my case, I don’t want to do trade in, since I want to get a Tesla…
