Lease ends January 9, 2022; buy out tomorrow is $15,843. End of lease purchase price is $14,060, add to that the 3X $209 payments and you get $14,687. I assume there will be some fee at the end (maybe the same fees for an early buyout?) but purchasing it earl does not seem to make sense.
BTW, it is a PHEV Clarity, $0DAS, $209/month all in including taxes at 8%.
What are the fees listed on your lease contract?
Have you considered tax?
14,060 * 1.08 = 15,186
Plus $627 = 15,811
Diff = $36
Taxes will do that to you
It is my understanding that the taxes are in addition to both of the scenarios; Honda Finance so indicates
How much are the fees listed on your contract?
The only fee was the acquisition fee $595 and a turn n fee. if I do not purchase the car of $350
The website states:
Mail the full payoff amount (including state sales tax, if any) to the address below. If there is no outstanding balance on your account, the title will be mailed upon verification of final payment clearance. It is important to verify HFS has your current address on file to ensure you receive your title.
Seems like payoff includes taxes.
Btw, why are you trying to buyout early?
That would explain it, although the payoff screen at Honda Finance lacks details.
And I am not trying to buy it out early, but when I was getting ready for the end of lease I noticed what seemed to be a discrepancy, but maybe not. I’ll have a chat with the guy who sold me the car tomorrow/
I don’t think he’ll know.
Just talk to HFS directly.
I think the taxes explains it, the documentation is clear that taxes are due at lease end buyout but no such mention is made for tomorrow’s payoff.
I have the same car (2018 Clarity) and my lease ends Jan 1, 2022.
I am planning on buying it out in December thru my CU.
Why pay 4 months of lease payments ahead of time, and finance that amount into the RV (buyout) ??
My CU said they can buy it out now, but they advised me that doing so, will incur the finance charge on the total loan - they said to wait till the last payment is made and then buy it out.
CA taxes will be assessed by DMV when title changes.
Here is what Honda said about the buyout process:
If you decide to purchase your Honda vehicle, there is no need to have it inspected. Just follow these easy steps to make it your own.
Step 1:
Obtain a payoff quote online by logging in to your account or by calling our automated system at 1-800-708-6555. As a reminder, lease purchases are only available to the lessee or authorized Honda or Acura dealer.
Note: If you live in IL or OH, certain conditions require that you speak with a Honda Financial Services (HFS) Lease-End Specialist.
Step 2:
Contact the Lease Maturity Center and notify us of your intent to purchase the vehicle.
Is the CU interest rate higher or lower than the current rent charge rate?
Thanks to all for your input, Honda confirmed that the early buyout included the sales tax while the end of lease purchase does not. This explains the apparent difference (which is no big difference at all).
One things left to learn… early payoff and purchase comes with no additional fees. the contract is vague about end of lease buyout. It is almost impossible to get a human at Honda Finance, endless menus, ugh!
Guess NY is different than CA, where I will owe sales tax on the RV at end of the lease.
I am going to have my CU send a check to Honda Financial for the RV (buyout price), then when title is sent to the CU, I will go into the DMV to have them change title and pay the 9.5% sales tax.
This is because one pays sales tax on the entire lease value upfront, so you’ve already paid for the delta between buy out and RV. With CA, you only pay taxes on the payments, so any additional vehicle value between the buy out and RV hasn’t been taxed yet.
If you pay that sales tax amount to the lessor on buy out or the dmv after buy out usually comes down to how title transfers are handled.
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