Returning first lease, '20 VW Tiguan 18k miles

Ask the Hackrs
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Returning first least with VW SE 4 Motion, sunroof. Got the car during early COVID days, so amazing deal $0 down $0 security /$0 first month @$365/month for 39 months @ 10k.

Only have 18,500 miles on it, $16k residual. One large scratch and a few small dings (one came from the dealer but lost the paperwork with their signature - assuming they will try to ding me for it).

There is a decent amount of equity in the car (between $5-$8k based on market rates $21-$24k). Few questions:

  1. What should I settle for the trade in value at the dealer?
  2. They aren’t giving anything off MSRP, low inventory. As a returning customer what would you negotiate on?
  3. Interest rates are not what they were in April of 2020. Is it reasonable to aim for $0 down, $0 security and a monthly payment of <$370 given the above? The LH Calc seems to think so

Thanks in advance!

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Putting down $5,000 in equity is a pretty bad idea. What are your options without doing that?

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Think most will say do 2 separate deals if you have equity. I.e. sell Tiguan for a check then do your new vehicle deal. If you do it together there’s too many opportunities for dealer to hide money.

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@max_g think getting $5-8k for my current vehicle is a bad trade? You would take the cash and pay a higher monthly price?

Options without the trade are:

  1. extend lease for 6 months (93% goes to the buyout value of my car, money was free in '19) - test the market in Dec/Jan
  2. buy my car (option 1 prob better)
  3. sell my car ($22-$26k) and lease a new car, looking at mid $400 + down payment (TBD)
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@rb234 think there is a lot more to gain? Will I have to pay taxes on the profit from the sale? +will they hit me with other fees (i.e. deposition etc.)? It’ll end up netting something close to what I would get anyway?

6

That’s exactly what I did. Lease ended last June, RV was 13.6k And Carvana/CarMax value is still in the $21.4-$21.8k range.

If you finance it over 48-months, you’ll be at or under your current payment and will be likely to always have equity.

Why cash in all your equity only to have the same payment and then likely be sitting on zero or even negative equity thereafter?

1 Like
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agree, I’m leaning into extending the lease for 6 months as it’s a free option to see what happens in the market. If there are deals, trade up. If not, go ahead and finance the difference. Monthly payment will be $100 cheaper.

LH Calc shows the ability to get into a '23 for $340 but doubt the dealer will want to offer top $ for my vehicle since they don’t have new inventory.

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Correction, your LH calculator shows the abilty to get into a '23 for $517 a mo.
The question to ask yourself is, how much is that new car smell worth? (i’ll bet with only 18.5k it almost still smells new)
How much the new technology (if any) is worth?
Can you shop Dealers? Can you expand your search out to 300 miles to get a better deal?
It seems you are happy with the vehicle and brand then yes financially you are best by extending 6 months (on a month to month basis) and deciding in Dec

1 Like
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Thanks, I wasn’t thinking about the effective rate. That makes it much easier to compares apples to apples!

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