Is there a way out of this car because I have less than 700 miles on it, or am I screwed either way?
You need to get estimates from multiple places and compare that to your current buyout. If you have equity, they cut you a check. If you donât have equity you need to make up the difference. When I flipped my 1 month old S90 in Feb, I got offers from ~5-7 places and the spread was about $10k between high and low with Carmax being highest. There really wasnt much data on used 2018 values in KBB, NADA, Black book, etc.
Thanks very much fo the info. Iâll head out to Carmax on Saturday start with them.
Try a Honda dealer. They just might pay more than Carmax. Still think your best bet is to figure out how to sell it privately
How much you are upside down also depends on how well of a discount you negotiated for the lease.
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Was that 10k essentially what the equity would be left after carmax pays the leasing cimpany what you owe?
Iâm gonna say right now youâll almost certainly take a bath selling the Pilot now, unless you got some '16 Cruze giveaway type lease deal, which I doubt. Itâs just a matter of how much of a bath. If you are exploring the sell to Carmax/dealer route, remember that in addition to the residual price listed in the contract, you will also be on the hook for ALL remaining lease payments. I donât know if you posted what your monthly payment is, but looking at carsdirect I see lease quotes around $329/month (with $3k down). If we ignore any money you put down to lease the Pilot, thatâs around $11k in lease payments youâre on the hook for either way.
Still possible that selling now will be cheaper than riding out the lease (especially when you factor in the insurance payments you donât have to make), but be prepared to see some crooked numbers. GL!
No, the $10k was the spread between offers received from the dealers to whom I took the vehicle for evaluation. Had a low offer of $35K to a high of 45.5k for the Carmax offer. And a few dealers who stated that their number started with a 3, so they knew I wouldnât be interested. The equity left was the difference between the highest offer and my buyout which was ~$3500.
He wouldnât be on the hook for the remaining lease payments if he sold the vehicle at the current buyout amount. (This is different than the lease end RV amount. Each month on your statement, they publish what the current buyout is and it slides down through the duration of the lease, hitting the RV at the end of the lease).
He would be DEFINITELY on the hook for the remaining lease payments. The buyout price includes the remaining payments (residual + remaining lease payments - a bit of interest saved). I guess I should have clarified that. Some people think they only need to pay the residual price regardless of payments remaining, which is incorrect.
I think we are saying the same thing. The current buyout price would be what he owed. And that price is derived by initial cap cost - depreciation and interest paid so far. If the lease ran its course, that amount would be the RV, but since the lease is new that amount is closer to the initial cap cost. [And as MF is almost 4%, the amount of interest on the Pilot is higher than other manufacturers who offer ways to get close to 0.]
This is something I plan on doing as well. My 2015 Mustang GT is low on miles and the end of lease purchase price is around $20,500. Kelly Blue Book has something called an Instant Cash Offer. You enter your vehicles information and they tell you how much one of their certified buying centers (aka affiliated dealerships) will give you for it. I filled out the form and received a phone call from Bonita Springs Mercedes without a couple hours asking to see my car. I drove it in the next day, they looked it over and offered me the Instant Cash value of $24,659. I didnât take it then, because I still need a vehicle, but as soon as I buy something else I will be doing it again. Getting $4k back on a lease is a nice feeling. May even get something cheap like a Cruze and put that towards a one payment. Almost a free 3 year Cruze rental, almost.
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What about with MSDâs, what happens if you sell your leased car?
Sometime after the sale completes they mail you a check for them. In the case of my s90 flip, carmax paid Volvo ~10 days after I sold vehicle to them. Volvo sent me MSD refund 2 weeks after Carmax paid off vehicle, so it took about a month.
Thanks for the answer! I just leased a Tacoma Sport Cement Color Manual transmission, it might me a good candidate for the flip.
-Rejo-
Going back to the Tax question,
Donât you have to pay tax if you were the sell the car privately? since you have the buy the car first and sell it?
Also if you were make profit from a trade in, wouldnât you have to pay the tax on the profit different?
How does it go? Did you end up selling it to carmax and paid off your lease? I am in the similar situation. I just lost my job and want to check how did you sell your leased car.
The seller dont pay tax, only the buyer pay tax (the seller actually paying for tax every month in California if they lease or pay as a whole if they buying the car)â- if carmax or dealer buy your car they will resell it so their buyer will pay tax (company has the reseller tax id for the resell purpose).
To answer the selling your lease car question. You sell the car at the buy out rate at the time you call the leasing financial company. They will calculate how much you need to payâ the calculation is your original signed residual + the left over monthly residual. For example. You bought a car at 50,000, residual is 30,000. So you support to pay 20,000 for over 36 month + the money factor aka interest and the sale tax (555.55+ tax and interest). Lets say after 18 month you want to sell the car. Your pay off will be 30,000 + (555.55 * 18)= 40,000. Yes you dont have to continue paying tax nor interest afterward
Once you go to carmax and they said that they can buy your car at 39,000. Then you have Cut a $1,000 check to carmax then you are done with that car. If they said they will buy at 41,000. Then they will pay you $1,000. And yes you dont have to pay tax on that $1,000 (technically you still need to report to IRS at the end of year when you file your personal tax). However, if this car is registered under a business you have to file the loss or profit so you need to work with your CPA.
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It depends on the state and/or the finance company. Some like CA have an exemption where you can be reimbursed if you re-sell the car within 10 days. So finance coâs will send the title to the buyer so you donât actually have to buy it and title it.
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thanks everyone for the reply, it was very helpful.
I have a 2015 sienna with 22500 payoff and i have few dealers offering about 24-24500. I havenât tried carmax yet since there isnât one near me. But is that the best bet?