If I transfer negative equity into a new lease, do I still get to keep the old vehicle until expiration? I’m thinking about doing that and the leasing the last 10 months on my mercedes for a steep discount.
Thanks!
What negative equity if you keep your car? Only if dealer buys from you at lower price than your payoff amount.
If I roll my negative equity from prior lease into new loan. It’s too much to buy me out. Do I still get to use the car?
To have negative equity in the new lease your dealer has to either buy your car (see above) or cut your a check for some amount and you get to keep your old car (not sure why you’d do it).
Either you are confused or I am now.
It sounds like you are asking about some sort of payment consolidation, where you pay 1 larger monthly payment for both cars, not negative equity. I think. I don’t know, now I am confused, too.
Sorry - maybe I used or misheard wrong terminology from a local dealer. Effectively, I’m in a lease with 10 months left and a total of $8,500 left in payments. The spread between what I can get for selling the car and the payoff of the lease is about $10,000 - so it makes more sense to just roll the remaining payments into the new lease. The dealer I was at called it rolling in negative equity - but maybe I misheard.
To my knowledge, the way this works is that they build it into the new payments and payoff the remaining payments on my existing lease. My question is this: if that is the case, do I still get to keep and utilize that car as well for the remainder of the period, or better yet, can I transfer the lease to someone at a steep discount to offset the expense.
You can keep the car and turn it in at lease end. Why would you want to roll the last 10 payments into the new lease? Why not just get the new one and keep the old one as a separate transaction. If you have them cut a check to you for the old lease you will end up paying interest and sales taxe on the $8500 2 times.
yeah, I’m not sure you’d want to do this either. I think you’d be better off keeping both transactions separate.
Let’s assume you owe 100.00 a month on your existing car, for 8 months. Let’s assume your new car is 200.00 a month for 36 months. You’d roll 22.00 in payment (roughly, and not including monthly sales tax or interest) over the life of the new car, which doesn’t sound like a ton (and we’re dealing in small numbers here). At the end of 8 months, you’re giving the old car back, yet still paying for it, buried in the new lease, including interest and sales tax for the next 28 months. You’re effectively paying more for the old car doing it this way.
I’m not sure why you’d want to do that.
I believe the short answer is no, you do not get to keep the car. The dealer is ‘loaning’ you the $8500 you have left in payments, in return you are giving them the old car.
he wouldn’t be giving them the old car if it’s a different manufacturer. If he is currently in a BMW lease, the dealer pays off the BMW lease by rolling his remaining payments into the new Mercedes lease, the Mercedes dealer isn’t keeping that BMW. In this case, theoretically, he could keep both cars for the remainder of the BMW lease and since the remaining payments were made to BMW, he would drive it “free” for the next 10 months, but I’m not sure why he would do this from a financial standpoint.
The only way the Mercedes dealer keeps the BMW is if they do a trade. However, from what he indicated, he’d owe another $1500 doing it this way.
OK my mistake. I thought this was a trade-in scenario. In that case, I’m with you… I’m not sure why he would want to do that.
this is the car OP is talking about:
Sorry - the thought process was as follows. Not sure if I’ll be able to get anyone to bite on taking over my lease. But wanted to get into a new x5 now. Rolling it in would mean worse case scenario my payments increase by a couple hundred a month, and maybe i’d be able to reclaim some of that if I was able to lease it out from there.
@uscjgood, you didn’t state how many miles are left on the lease. That is a big factor, if you’re short on miles left then it’s going to get even harder to lease transfer. Might be a good idea to update on the other page.
Lets say you have enough miles, realistically, you’d have to get the payment into the low 400s range for someone to be interested based on what i saw on SAL. Your current payment is around $850, so you’d have to offer around $4500 (10x$450) for it to be attractive enough to get rid of it fairly quickly and you’d have to post it on SAL or lease trader because you’re not likely to find a person here. Lets say you pay the $4500+ transfer fee that’s about $5000 to get out now. Over a new 36 mo lease that would be the equivalent of an extra ~$140/mo.
If you trade it into a dealership and they pay off the car it’s more money. It’s your cheapest way out if you really want out.
FYI - swapalease.com (SAL) is about $100 to post there and you will have the most exposure to people looking to get into a lease. They have different (more expensive) options but I found that the $100 worked fine for me when i did it.
Thanks - that’s helpful. Are there any laws/rules about just doing an under the table agreement with a friend. Like - just had them pay me a few hundred a month to borrow it for the remainder of the term?
@uscjgood not sure, but your insurance is the bigger issue if something happens.
best to check with your insurance.