What does the 200 dollar service include? Coming from Audi… That’s dirt cheap.
@Outbackgirl - as Dr.O mentioned above, there are a lot of moving parts here.
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if your credit score is banged up, you’ll likely get a higher rate and it sounds like you’ll need a co-signer. Co-signing is a lot to ask of someone, family or otherwise, as they’re on the hook for the payments and potentially if there’s a lawsuit from an accident. Perhaps lay low for a while and heal your credit.
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in late August you had 23,000 miles on the car, so it looks like you’re driving 13,000 miles/year? What was your original lease date, how many miles do you have now, and are you driving the same amount through the lease end in May, 2020? If you finish this lease with 46,000 miles, you’ll only owe $1,650 (plus tax, I think) for excess miles. Seems a lot better than $6K.
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call Subaru/Chase and find out what your payoff is now, not including tax. Ask them if it’s lower for a Subaru dealer or higher for a third party dealer. Somebody like Carvana or Vroom might give you more than the dealer would for the car, too.
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if you have to bury $5,954 in negative equity, that is $165/mo in the next lease in principle. Plus tax and interest. So it might be more like $180-190/mo.
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what state are you in? Do you pay tax on the whole car when you lease it, or just the normal tax on each payment?
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don’t lease a new car just to get free maintenance or to escape a relatively small excess mileage penalty. They’re not that significant compared to the other issues. Forest for the trees. You’ve got plenty of time to plan and prepare here…
It’s for a 2019 Outback Touring which is what I really want. Including the negative equity, I made an offer for 32 mo/15K miles $596/mo with 600 down (for first payment) and they say they can’t do better than 42 mo/15K for at $596/month and $600 down. For 36 mo/15K he said it would be $30 more/month.
Before I made the offer I did my research using the Edmunds lease calculator which gave me what people are paying in the area, plus I plugged in .00040 MF and 55% residual, plus my trade in and what the dealership said my buyout was.
He was saying that I should do the 42 month instead of 36 month so I wouldn’t have to pay $30 more/mo and at the end of 36 months the Touring wouldn’t have anymore negative equity and I could bring the Subaru in and they would buy me out of the last 6 months of the lease and I could get into another one. Is this sort of thing true?
No, it’s not true and just the typical thing some douche salesperson would tell you to get you to sign a bad deal. Saying that you “wouldn’t have negative equity” after 36 months into a 42 month lease is 100% not true (the dude does not have a crystal ball to predict the value of your trade versus your payoff). Plus, him getting you into a new car just means you are locked into Subaru and he will roll the last 6 payments into your new lease again.
I think you are ignoring the advice of all the good people on this site if you are still planning on going through with the deal at this point in time considering it is a bad choice all around financially. If you are tired of this car now (or ready to get out of it) for the reasons you listed already then chances are you are going to be tired of the next one half way through the lease as well and you are going to be rolling even more negative equity into the next one for the same reasons. You aren’t in a bad spot (i.e. the damage on the car, maintenance, and the expected over miles are not really good reasons to get out early). What I think is really going on is that you want a new car. Period. I know how you feel. The last year or so of a lease for me are the hardest, I can’t wait to get out of the car and even if I am driving a fine car or a good payment, I just can’t wait to get out of it. I am currently in a 24 month lease and have been thinking about new cars (and considering deals) for the last 6 months (my lease is up next month finally)! But I have to advise you like others, don’t do it. You are just throwing your money away if you do. Wait out the rest of your lease and pay the penalties for miles later.
Believe me, the shiny new Outback Touring is going to be just as dull to you in a year or so as this current one you own is. If you are itching for something new, take that $165 more per month that it is going to cost you and buy yourself a watch or a purse or a annual pass to Disneyland for you and the kid/s (probably not enough for a Disney annual pass nowadays though - haha) and in a few months (or however long), when your lease is up you can get that Touring Outback (which will probably have newer and cooler stuff then) for cheap and still have the extra money to buy other cool stuff.
As a side note, I don’t know how much Outback’s usually cost but $600 sounds like a lot even considering the negative equity…
So, did I make a dent?
It honestly sounds like outbackgirl just wants a new car. Look, I get it, I’ve been doing that for the past 10 years of my life and only now am I starting to see the light of it. I’ve rolled over so much negative equity that my eyes are starting to bleed.
Only now will I finally be in a position to be rid of all of it. Take the advice from people who have been there… Just hold onto the car until lease turn in and pay the mileage overage. It’ll be way less than losing 6k over the next 3 years.
I know I will get a lot of heat on this post. But what’s up with all the financial advise here at leashackr? Last thing I check this is a leasing site where everyone share their lease and help someone get a decent deal and not get scammed by dealers. We really should not care how @Outbackgirl spend his/her money on a car. Did anyone even ask how much the car is? A quick search shows me that a touring is $39-42K. And another quick search at Edmunds and most site shows that there are no current incentive on Subaru outback. Obviously she wants a new car for whatever reason. Why don’t we just help and see if the deal make sense.
I know you guys are right and probably trying to walk me down from a cliff which is a good thing. I probably won’t do it now even though I am tempted.
You’re right. I am curious if this is a good deal regardless of the bad equity. It would help me for future reference if I should even deal with this person or how to get a good deal in the future.
Yes, you did. You get me!
Never, ever, ever, EVER lease a car and go significantly over the allotted mileage! But you just learned that the hard way 
Sorry pal, you’re pretty screwed, gonna cost you big $$$
It’s not that big. Smaller than the negative equity, right?
I don’t think the financial advice given here is out of line, since the original question was what to do with the negative equity.
The problem with answering if any of these leases are good, is that everyone is going to say “no”, because rolling negative equity (especially that much) into a lease is almost always bad.
Don’t do this deal, you’ll just be worse off. If you truly want to get out of this situation you’ll have to suck it up and downgrade your vehicle or keep this one until the end and pay the mileage. Don’t ever lease for more than 36 or maybe 39 months.
I respectfully disagree with this. I think it’s fine to go over miles, as long as you plan for it. Putting miles on a car costs, period. It’s actually a concept I think a lot of people have trouble truly understanding. The AAA average cost to drive per mile is something like 50 cents (though that does include insurance and fuel).
Even if you use a more expensive 25 cents a mile overage as an example, and drove a crazy 10k miles a year too many. That’s only about 210 a month. That’s basically cheaper than any other way to travel those miles. Other than maybe a bus, if you value your time at 0. Even buying used, you’ll get hit with devaluation and maintenance in that cost range.
Because what’s the point of saving $50/mo stacking incentives if you’re going to flush $300/mo down the toilet?
Is this whole thing a joke? I think we’re being taken for a ride bc it’s hard for me to imagine people really just throwing money away like this?
Anyways this has probably gone on longer than it should have. She is going to do what she is going to do.
@Outbackgirl - I think the key here is why would you want to roll $6K negative equity into a new lease when you mileage penalty at the end is around $1,650? Based on the miles you plan to drive from now to the end of the current lease, how many miles will you have? My guess was 46,000, and if your penalty is only 15 cents/mi, that’s only $1,650. It probably would have been cheaper to lease the car for 12,000 mi/yr, possibly 15,000 mi/yr, but sometimes it’s hard to predict how many miles you’re going to put on a car. At 15 cents/mi, you can’t make too big a mistake. It’ll be more important on you next lease if the penalty is 25 cents/mi.
You have another landmark to consider- when the warranty runs out. That will be 36,000 miles, right? Then you have until 60,000 miles on the powertrain? There’s other landmarks coming up that can affect your decision- like when will the tread on your tires affect what you’d get for it, and hitting 36 months and having to renew your registration.
If you decide to move into another lease now, you’ll need to evaluate the new lease some more- will you get a MF of 0.0040, do you need 15K mi/year, are you getting the best price for your current car, did you verify the payoff to make sure it doesn’t include tax, if it’s the same for you, a Subaru dealer, or a third party dealer? You’re going to need reliable numbers to make a well informed decision.
By down grading cars and getting a cheaper payment, lets say $400/mo, she’ll save $180/mo times whatever term is left on her car, plus won’t pay a mileage plenty. She mentions wanting to lower her payment, but then discusses a new lease for more money, “It’s for a 2019 Outback Touring which is what I really want. Including the negative equity, I made an offer for 32 mo/15K miles $596/mo with 600 down (for first payment) and they say they can’t do better than 42 mo/15K for at $596/month and $600 down.”, so who knows what she wants. The thing about these situations is you eventually get to a point where you can’t roll in anymore negative equity, the glitch fixes itself at some point. At some point your over 120% MSRP and need to come with cash or you’re done. I think were close on this one. Hopefully other people read these threads and learn not to do this.
Exactly, ha!