Toyota Highlander Upcoming Lease Buyout

Ask the Hackrs
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The lease term on my 2018 Toyota Highlander is ending in 5 weeks and I’m trying to figure out what to do next. This was my very first lease and I learned alot from this forum when I entered into it.

It seems like the car market is fairly crazy right now so I’m not sure exactly what to do. My original intention had been to roll into a new lease for a hybrid version of the Highlander but deals at the moment seem non-existent.

Furthermore due to the COVID lockdown and some unfortunate circumstances within the family, we have barely used the vehicle during the lease period and it is in pristine condition with only 8745 miles on it. The residual value is $28,283 and I am see quotes of $35,000-36,000 on Vroom, Carvana, Carmax, etc.

The lease is with Toyota Financial Services. The finance manager I spoke to last week said they are allowing selling to a 3rd party but suggested that the easiest way to proceed if I really want to sell the vehicle would be the buy the car outright at the end of the lease next month and then sell it. I hope this is not misleading.

We do very much like the car and I’m not sure the the positive equity position is a bubble that we should cash in on at the moment. I don’t think I’ll be able to find similar lease terms on a similar vehicle at the moment.

If I do buy-out the lease, do my MSDs count towards the payment amount are are they already netted in the Residual?

My full lease details are below. Any thoughts would be greatly appreciated.

2018 Toyota Highlander Limited Platinum

**MSRP: $48,905
**Selling Price: $43,535
**Monthly Payment: $425
**Cash Due at Signing: $3,000 (This covers a $930 cap cost reduction, first month lease payment, and all other fees)
**MSD:$2,700 (6 MSDs)
**Incentives: None
**Months:36 months
**Annual Mileage:10,000
**Residual:$28,263
**Region:NJ

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You have until Aug 1st to sell to a third-party, that is the easiest route.

If you buy it out for resale, you will owe tax on the transaction in NJ.

The bigger problem is

You need to find a replacement in this market.

1 Like
3

I would extend the lease. You won’t get anything close to those numbers in the current market.

4

It is a matter for debate but I would cash out the $7k -$8k in equity and use that to help pay for the new lease. I think you will still come out ahead. That equity effectively reduces the monthly payment by $208 a month.

But to really weigh both options you would have to see how long Toyota allows you to extend for and then guess what market is gonna looks like at end of extension.

2 Likes
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Thanks for the responses. What are the right things to ask if trying to extend a lease? Is it almost the same as negotiating a new one or do the same terms usually carry over (ie. you buy more of the depreciation)?

6

“Hi TFS, I’d like to extend my lease.”

That’s all there is to it. There’s nothing to negotiate.

2 Likes
7

Yes, that’s the best idea for me too - extend my lease for 6 more months to see if the crazy market reverses.

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Is August 1st confirmed for the Toyota third party lease buyouts?

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Yes, and in some cases third-parties have already stopped buying (eg iirc Carmax stopped buying SE Toyota FS), but definitely ending 8/1 everywhere.

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Thank you so much

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