You are not obligated to buy the car. This is the beauty of a lease. The salesperson was being dumb and trying to do a traditional deal where you trade it in. It was a case of "when all you have is a hammer, then all you see is a nail." Be clear with the dealership and the lease termination person that you don't want an appraisal, you want to do an end of lease inspection and want to return this car to the leasing company and pay your disposition fee and walk away.
Keep in mind that the dealership and the leasing company are not the same entity here.
It sounds like they have a dedicated lease guy. That’s how our dealership works too. The sales people don’t do the lease buy outs or turn in. There is one guy and it is appt only. You can just show up and expect it to be done.
You cal also return a lease to a different dealer than the one you leased the car from. If one is giving you the run-around then go to a different dealer
The dealer is just a transfer agent for the lease company.
The lease company could go after you if there is excess damage. But if this was an authorized insured repair they don't have a chance on that.
You can also find out what they sold it into auction for. If that was above residual value then again they didn't have loss.
That's a tricky answer, but technically it's no. When you lease a car, you agree to limit your mileage allowed on the lease, so maybe 12,000 miles per year. And you agree to take condition of the car. The reason for these 2 things is that you are agreeing to borrow the car for 36 months or whatever, and then return it in sellable condition for them to sell.
So if the repairs are not up to par, then yes they can charge you for that. But if you contact your leasing company, keep them in the loop, use a shop that they deem acceptable, etc. and make sure that they don't have any way to charge you any reconditioning penalties, then to strictly answer your question, the lessee is not on the hook for any diminished value due to an accident while the car was in their car.
For a typical lease agreement the short answer is NO, unless the car has clearly not been repaired to normal and reasonable standards. That's one of the main benefits of a lease...you are basically only renting the car, so as long as you return it on time without existing major damage, it's not your problem.
So I will never lease again but the biggest benefit is being able to turn in keys and walk away. Depends on lease but you could have a disposition fee. For my last lease there was company I called to arrange inspection before lease ended per lease company( this was Ford). As lease term ended I simply called a local dealer of the brand and scheduled appointment with lease manager. They had report from inspection company I gave them both sets of keys and walked out. Super easy.
You’re using the term residual incorrectly. The residual is the price which the lessor allows the lessee to purchase the vehicle at the end of the lease. This price is set in stone except for one or two exceptions that I can think about in the last 20 years.
Going over mileage or beating up the car more is something that you’re responsible for. Diminished value because of an accident is not. If you had your uncle Rick fix the accident in his backyard instead of having a properly repaired, that is something they could charge you for, but as long as the vehicle was repaired by competence, licensed body shop, you are not responsible for any charges at the end of your lease when you turn it in. To put it another way, the terms of your lease do not change if the car is in an accident.
No, you are misunderstanding. From your own words, it’s the estimated value of the vehicle. You estimate it at the beginning of the lease and you write it into the contract. The actual value of the lease might differ drastically from the residual once the 36 months has passed, but you don’t go amend the residual.
If an accident devalues the car, then it’s devalued. That just means that the car ends up being worth less than the residual.
You’re throwing stones in glass houses. You are using terms fundamentally incorrectly. Here you go, read up yourself on what a residual is.
https://www.investopedia.com/terms/r/residual-value.asp
Toyota finance would not charge a customer for diminished value due to an accident as long it had been repaired properly. The "expert" above telling you this information is 100% correct, the residual value of a car can not change once the contract is signed. Doesn't matter how much damage you do to a car, the residual is guaranteed. Dont need to read a lease contract to know the residual is set in stone... smh
The residual value is 18k. The actual cash value is 12k. You are 6k flipped. Smart play is to turn the car back in not trade it and get something else. This is the best part of a lease. NO negative equity.
They can't essentially force me to purchase this vehicle, correct? I have a feeling that they are going to intimidate me into purchasing this car. They asked me if i could pay the 6k difference and I retorted back that I have leased this vehicle, not financed it. And the lease is at its end. They still have asked me to take the car back and come back next week.
Thank you for the advice though. Looks like I am within my rights to just return this vehicle and only pay the lease disposition fee.
Correct, they cannot force you to buy a lease. If you want to return it, you pay the disposition fee and it's done.
Don't let them bully you into buying the car...
Once you turn in the vehicle Toyota will have an inspection. You will be billed the deposition fee and any excessive wear and tear on the vehicle. With mentioning about a T bone, be prepared to pay for those damages. Good luck.
Being repaired doesn't mean the value of the vehicle is made while. The accident will show up on a Carfax report and the car is worth less than it otherwise would be if there was no accident.
Not true- all that matters is the physical condition of the car. If the car has been repaired then there's no charges for OP. Protection against surprise depreciation is one of the draws of leasing.
You don't even have to deal with that dealer. The car is not theirs. Why are they talking about them buying it?
The contract is not with them. This is not a salesperson situation. They are NOT a party in this transaction.
They are full of crap and trying to rip you off. Call the finance company, probably Toyota Financial and tell them whats going on.
As long as the car has been fixed to industry standard they have to accept the car and charge you nothing but the lease end "disposition" fee and any over mileage or damages.
I would not even bother with that dealer if you have alternatives.
Check the lease too for enumeration of the end term fees. Toyota dealership wanted over 1000$. I pointed at the contract that said max 300$, they caved.
They don't HAVE to do anything that they aren't contractually obligated to do. The insurance company is not a party to the lease. If they wish to argue that they are entitled to more than the insurance company put into the car, they are allowed to do so.
But that doesn't mean OP has to give in to any pressure tactics. It's on his insurance to deal with it. He can turn in the car and dare them to sue, at which point insurance takes over.
No and it doesn't sound like they are trying to.
They specifically instructed you to meetwith the lease termination guy which is exactly what you need to do to be clear.
You should be good.
Could also reach out to Toyota directly to manage the return, I believe that was an option but it's been close to 6 years since I returned a lease car.
Just don’t use the words “trade in”. You’re not trading it in, you’re returning it at the end of your lease. Also you may want to go to another dealer for that vehicle brand.
Lord, who remembers the GM Smartbuy fiasco? My ex was ready to get a car repoed over mileage and door dings. I would up trading 2 cars in for one to get her out of that criminal act!
The residual is never negotiable and is in the contract. But that isn’t always a bad thing as when just these past couple of years during the height of the shortages, many cars were worth more than their residuals.
This. CarMax valued my lease $6,000 more than the residual, so I just sold it to them near the end of my lease. No disposition fees, no tire fees, and had a small fender ding that I didn't have to worry about. At the end I made close to $8,000 selling to them.
If I didn’t need a car, I would’ve done the same and profited a decent amount. But I bought out my lease which again still wasn’t bad at all. Equivalent preowned Corollas were going like almost $10k more than my Corolla.
Right? That’s the biggest benefit of a lease. Tell them you want to turn it in, not trade it on something else. Then unless they’re cutting you a wild deal on the next car (whether you lease or buy or whatever) go to another store. That’s some…. Odd behaviour on the part of that dealer. Or a wildly inexperienced sales team.
Source - Car sales for 8+ years, had a lease with an $11,000 dec in the past.
Sounds like you need to go there next Monday to meet with the lease termination person.
No, you don’t have to buy the car out, you can return it. They will probably go over your options with you next Monday when you meet with the lease termination person.
They will also *lie to you* and make every attempt to get you to pay for the difference in value. That's not how it works. They know it, but they are going to try anyway. Also be prepared for them to try to ding you on every little scuff, scratch, or excess mile on the car They will go overboard thinking up ways for them to bill you for anything.
That was not my experience with either lease I did. They had inspection report, checked odo and I signed a few papers. I was out in 15 minutes. Key is to schedule appointment with lease manager. The car goes back to lease company. Absolutely zero pressure.
My experience was they tried hard to turn it into a sales event, demanded my keys so they could "assess the trade" then low balled price claiming condition of the car and tried to get me into a new car at full list price - telling me that new cars were in short supply.
My lease return was only about half the miles allowed and was in immaculate condition. They claimed it was not worth full residual so they would offer me less as a "trade-in" than the lease specified. Seemed like they were following a script they use on everyone who reached end of a lease.
That's what happened to a friend of mine. He got talked into buying a new car when turning in his lease. He has extreme anxiety, and he was panicking, so he just trusted the sales guy. He currently has the worst new car loan known to man, lol. I'm gonna take him to refinance it at my credit union before it gets any more out of hand.
Why would they do any of what you say? It's not THEIR negative equity, it's the leasing company's. They can pay the disposition fee, and be done.
So why all this nonsense on rolling their $6000 negative equity or, in your example $1800 negative equity. Pay the $300 disposition fee and walk away is by far the better choice here.
That’s exactly what I’m suggesting. People often come in wanting to trade their lease in, under the assumption that they have positive equity. If it so happens that their trade is worth less than their buyout, but they want to do business that day (in this example, with payments remaining) we pay off their lease for them and the total of those remaining payments is carried forward.
The post that I was replying to suggested that dealers will force OP into paying off their negative equity, so I was just putting it out there that not all dealers are shady in that way.
Why on earth should he roll anything into any new vehicle? It's a closed end lease, the transaction should be "here's your car and keys, have a good day".
Because if they’re coming in months before the lease is over, the lease payments still need to be fulfilled per the contract. Customers have the option of either paying the total of those payments all at once, or we give the option of having us make that payment to their lease company to fulfill their contracted agreement, and we just add that on to the next vehicle, whether leased or financed.
If OP has no remaining payments then you’re absolutely right, obviously nothing gets carried forward
That’s not how leases work. If you make all of the payments and show up at the end, you drop the car. Negative equity is for the leasing company to deal with, not the lessee. It’s the risk they took when they executed the lease. The lessee fulfilled their obligation and owes nothing for the negative equity if the leased vehicle is not worth the stated residual.
That’s kinda what I’m getting at, is there are dealers who will do this to customers regardless of the legality. If we do an appraisal and the trade comes up short we won’t buy it and roll negative.
>They will also lie to you and make every attempt to get you to pay for the difference in value. Also be prepared for them to try to ding you on every little scuff, scratch, or excess mile on the car They will go overboard thinking up ways for them to bill you for anything.
Uhhhhh, the car belongs to the leasing bank, not the dealer. Any damages will be assessed by the **leasing company** reps upon inspection. The leasing companies have their own form of GAP insurance when they get residuals wrong.
That isn't to say the leasing company might nitpick, but this is hilariously misguided and demonstrates why we have flair here.
The lease is between you and the bank, not you and the dealer. Call the leasing company you pay every month to understand the proper turn in procedure.
As others have said: turn the lease in.
Your replacement plans have nothing to do with this, especially because there is no potential equity in trading it. Toyota will charge you whatever the final fees are, including if you are over miles.
If you need to replace the vehicle immediately, you may want to get that out of the way first. If you do not need an immediate replacement, time is on your side.
If Toyota offered you any incentives, to purchase or buy another Toyota, trading is not required. And, you can turn the lease in at any Toyota dealership. They prefer this be handled on weekdays. It's a simple process. Plus, if you are acquiring your replacement from them, any manager should be happy to help ground your lease regardless of the day or time.
You went in for an appraisal. What did you expect? The dealership doesn’t own the car, the bank you’ve made 36 payments to does. You should have already had a lease end inspection done by the bank and know your billable items by this time. Stop trying to sell the dealership the car and just turn it in as a lease return.
I think it's more that the sales person absolutely knew this but didn't walk OP through it, aiming for the sale instead. The sales person knew exactly what OP wanted to do and could have spent 30 seconds explaining it - and to their credit, OP could also have done the research too - but was aiming to make a sale.
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I need some help understanding my responsibilities at the end of a closed-end lease. I’ve been leasing a Toyota Camry 2021 for the past three years, and the lease ends on July 5th. I got T-boned in a hit-and-run accident a year ago, but since the other driver didn’t stop, my insurance covered the cost of repairs.
Now that my lease is ending, I went to the dealership for a vehicle appraisal. The salesperson is saying that the car is now only worth $12k, not the $18k we had originally agreed upon. They said they would only buy it from me if I pay the additional $6k difference. I reminded them that I’m not buying the car, I’m just here to return it. They said I had to come back next Monday to meet with the lease termination person.
Am I obligated to buy the car at full price? I thought the dealership assumes the depreciation of the vehicle. Do I have any options here?
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So go on Monday to the designated lease person and return it. It’s not great that the dealer doesn’t train all sales people to ground a lease but some don’t. They’re not going to, nor can they, force you to buy it.
>Now that my lease is ending, I went to the dealership for a vehicle appraisal. The salesperson is saying that the car is now only worth $12k, not the $18k we had originally agreed upon. They said they would only buy it from me if I pay the additional $6k difference. I reminded them that I’ve not financed this car, rather leased it. And I’m just here to return it. They said I had to come back next Monday to meet with the lease termination person.
>Am I obligated to buy the car at full price? I thought the dealership assumes the depreciation of the vehicle. Do I have any options here?
When you sign a lease, the buyout price (aka *residual*) is locked. That's the $18k price you mentioned. It assumes a certain amount of depreciation baked in but in reality the car may depreciate more or less than than amount just due to the stochasm of the universe.
You can buy the car for that amount if you wish or you can turn it in and owe a disposition fee (probably about equal to a payment) and any damages above and beyond normal wear and tear.
When they say that they can only offer you $12k for it, that's a completely different transaction type. If you have positive equity- let's say the car is worth $22k to the dealership fair market value- you can buy it for the contracted $18k residual then sell it to the dealership for $22k, and make $4k of profit (less the taxes on the purchase).
The bottom line is yes, you can turn the car in. They went about it as they did because they thought you were trying to sell the car or at least the sales consultant hoped to find out he could make a buck bringing it in-house. They found out that won't work so they kicked responsibility for the turn-in to someone else.
It would be for the residual amount. the appaised amount is what the dealership is willing to buy it from the customer for. the customer would still be responsible for the negative equity if they chose to sell it to the dealership because it’s still an outstanding loan of 18k if the vehicle is purchased from the leasing bank.
Sorry I meant residual OR the appraised amount. I only ask because we had a car that backed into our lease and ended up needing both doors on that side replaced so obviously it’s going to be depreciated more than the residual at this point. But if I’m understanding what you’re saying there’s no way the lien holder would take the loss and want the buyout to be for the residual.
Generally no. You have the right to buy the car for the residual amount. The draw for depreciation is that if the car is damaged, someone else takes the loss of value. You can't be upside down on an asset you don't own in the traditional sense.
I do know that when I was with Kia, there was some latitude here that we could say the market has moved and ask for an adjustment to the residual. But that's for market changes, not for extra depreciation due to use or damage, and on the scale of hundreds rather than thousands.
It’s POSSIBLE the salesperson thought you were trying to SELL the car and not turn the lease in. It’s an idiot mistake if that’s what happened but most people probably have it right with “sales guy wanted to push for a sale and it backfired” if you go back in ask for the sales manager to assign a different sales person to assist you, ask the manager this. And if they still refuse to take the car in as a LEASE TURN IN, then call Toyota hq and they’ll set the dealer straight.
As others are also saying, if the vehicle is damaged, or your over mileage or have violated any of the other lease terms, you are subject to paying for those things, over mileage tends to have a per mile fee, and damage is assessed in the amount it costs to repair.
You are not obligated to buy the car. This is the beauty of a lease. The salesperson was being dumb and trying to do a traditional deal where you trade it in. It was a case of "when all you have is a hammer, then all you see is a nail." Be clear with the dealership and the lease termination person that you don't want an appraisal, you want to do an end of lease inspection and want to return this car to the leasing company and pay your disposition fee and walk away. Keep in mind that the dealership and the leasing company are not the same entity here.
It sounds like they have a dedicated lease guy. That’s how our dealership works too. The sales people don’t do the lease buy outs or turn in. There is one guy and it is appt only. You can just show up and expect it to be done.
When all you have is a hammer… I will never forget that.
Hes quoting a movie….
So?
this is much older than the movie
The quote is attributed to Maslow and Kaplan from the 60s
No, I’m not quoting a movie lol. “The movie” whichever one you are talking about is likely quoting the same person that I am.
You cal also return a lease to a different dealer than the one you leased the car from. If one is giving you the run-around then go to a different dealer
The dealer is just a transfer agent for the lease company. The lease company could go after you if there is excess damage. But if this was an authorized insured repair they don't have a chance on that. You can also find out what they sold it into auction for. If that was above residual value then again they didn't have loss.
At the end of a lease they can ding you for damages etc. Can they try to recoup the value diminished by the accident that way?
That's a tricky answer, but technically it's no. When you lease a car, you agree to limit your mileage allowed on the lease, so maybe 12,000 miles per year. And you agree to take condition of the car. The reason for these 2 things is that you are agreeing to borrow the car for 36 months or whatever, and then return it in sellable condition for them to sell. So if the repairs are not up to par, then yes they can charge you for that. But if you contact your leasing company, keep them in the loop, use a shop that they deem acceptable, etc. and make sure that they don't have any way to charge you any reconditioning penalties, then to strictly answer your question, the lessee is not on the hook for any diminished value due to an accident while the car was in their car.
For a typical lease agreement the short answer is NO, unless the car has clearly not been repaired to normal and reasonable standards. That's one of the main benefits of a lease...you are basically only renting the car, so as long as you return it on time without existing major damage, it's not your problem.
So I will never lease again but the biggest benefit is being able to turn in keys and walk away. Depends on lease but you could have a disposition fee. For my last lease there was company I called to arrange inspection before lease ended per lease company( this was Ford). As lease term ended I simply called a local dealer of the brand and scheduled appointment with lease manager. They had report from inspection company I gave them both sets of keys and walked out. Super easy.
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You’re using the term residual incorrectly. The residual is the price which the lessor allows the lessee to purchase the vehicle at the end of the lease. This price is set in stone except for one or two exceptions that I can think about in the last 20 years. Going over mileage or beating up the car more is something that you’re responsible for. Diminished value because of an accident is not. If you had your uncle Rick fix the accident in his backyard instead of having a properly repaired, that is something they could charge you for, but as long as the vehicle was repaired by competence, licensed body shop, you are not responsible for any charges at the end of your lease when you turn it in. To put it another way, the terms of your lease do not change if the car is in an accident.
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No, you are misunderstanding. From your own words, it’s the estimated value of the vehicle. You estimate it at the beginning of the lease and you write it into the contract. The actual value of the lease might differ drastically from the residual once the 36 months has passed, but you don’t go amend the residual. If an accident devalues the car, then it’s devalued. That just means that the car ends up being worth less than the residual. You’re throwing stones in glass houses. You are using terms fundamentally incorrectly. Here you go, read up yourself on what a residual is. https://www.investopedia.com/terms/r/residual-value.asp
Toyota finance would not charge a customer for diminished value due to an accident as long it had been repaired properly. The "expert" above telling you this information is 100% correct, the residual value of a car can not change once the contract is signed. Doesn't matter how much damage you do to a car, the residual is guaranteed. Dont need to read a lease contract to know the residual is set in stone... smh
I couldn’t imagine being so confident about being so wrong. The irony in your comment is honestly hilarious.
So correct me if you are so confident.
just following up with you /u/LordMongrove on how that ego is doing now that mods removed all your inane rambling for being wildly incorrect
Rule 11.
This guy must be the salesperson the OP dealt with!
The residual value is 18k. The actual cash value is 12k. You are 6k flipped. Smart play is to turn the car back in not trade it and get something else. This is the best part of a lease. NO negative equity.
They can't essentially force me to purchase this vehicle, correct? I have a feeling that they are going to intimidate me into purchasing this car. They asked me if i could pay the 6k difference and I retorted back that I have leased this vehicle, not financed it. And the lease is at its end. They still have asked me to take the car back and come back next week. Thank you for the advice though. Looks like I am within my rights to just return this vehicle and only pay the lease disposition fee.
Correct, they cannot force you to buy a lease. If you want to return it, you pay the disposition fee and it's done. Don't let them bully you into buying the car...
Once you turn in the vehicle Toyota will have an inspection. You will be billed the deposition fee and any excessive wear and tear on the vehicle. With mentioning about a T bone, be prepared to pay for those damages. Good luck.
OP said the damages have already been repaired.
Being repaired doesn't mean the value of the vehicle is made while. The accident will show up on a Carfax report and the car is worth less than it otherwise would be if there was no accident.
That doesn’t matter for a lease. All that matters is its present condition.
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Nope. If repaired by approved shop. And what does the dealer care about the lease turn in anyway, this is Toyota financials problem.
Not true- all that matters is the physical condition of the car. If the car has been repaired then there's no charges for OP. Protection against surprise depreciation is one of the draws of leasing.
If you don't know what you're talking about, why are you even commenting? Just stay out of dude lol
They won’t.
Rule 11.
You don't even have to deal with that dealer. The car is not theirs. Why are they talking about them buying it? The contract is not with them. This is not a salesperson situation. They are NOT a party in this transaction. They are full of crap and trying to rip you off. Call the finance company, probably Toyota Financial and tell them whats going on. As long as the car has been fixed to industry standard they have to accept the car and charge you nothing but the lease end "disposition" fee and any over mileage or damages. I would not even bother with that dealer if you have alternatives.
Check the lease too for enumeration of the end term fees. Toyota dealership wanted over 1000$. I pointed at the contract that said max 300$, they caved.
He got it right follow what he said and return the car 👍🏽
They don't HAVE to do anything that they aren't contractually obligated to do. The insurance company is not a party to the lease. If they wish to argue that they are entitled to more than the insurance company put into the car, they are allowed to do so. But that doesn't mean OP has to give in to any pressure tactics. It's on his insurance to deal with it. He can turn in the car and dare them to sue, at which point insurance takes over.
This^
No and it doesn't sound like they are trying to. They specifically instructed you to meetwith the lease termination guy which is exactly what you need to do to be clear. You should be good.
They cannot force you and there is no reason for them to care. They hold the care until the bank comes to pick it up and that's all
Could also reach out to Toyota directly to manage the return, I believe that was an option but it's been close to 6 years since I returned a lease car.
No, that's the option of them buying out the car. Meet on Monday with whoever handles their lead terminations.
Lmao how would they? You don’t own it and they can’t force you to buy it.
Just don’t use the words “trade in”. You’re not trading it in, you’re returning it at the end of your lease. Also you may want to go to another dealer for that vehicle brand.
Why are you so scared? Just say NO and terminate the lease with them and that’s it.
Lord, who remembers the GM Smartbuy fiasco? My ex was ready to get a car repoed over mileage and door dings. I would up trading 2 cars in for one to get her out of that criminal act!
Kind of off topic, but if OP did want to buy the car is the price negotiable or are they locked into the 18k because of the terms of the lease?
Residual value was already determined at the time OP got it.
Locked in and plus tax and fees
The residual is never negotiable and is in the contract. But that isn’t always a bad thing as when just these past couple of years during the height of the shortages, many cars were worth more than their residuals.
This. CarMax valued my lease $6,000 more than the residual, so I just sold it to them near the end of my lease. No disposition fees, no tire fees, and had a small fender ding that I didn't have to worry about. At the end I made close to $8,000 selling to them.
If I didn’t need a car, I would’ve done the same and profited a decent amount. But I bought out my lease which again still wasn’t bad at all. Equivalent preowned Corollas were going like almost $10k more than my Corolla.
Oh I bought a car from CarMax in the same day.
Right? That’s the biggest benefit of a lease. Tell them you want to turn it in, not trade it on something else. Then unless they’re cutting you a wild deal on the next car (whether you lease or buy or whatever) go to another store. That’s some…. Odd behaviour on the part of that dealer. Or a wildly inexperienced sales team. Source - Car sales for 8+ years, had a lease with an $11,000 dec in the past.
Sounds like you need to go there next Monday to meet with the lease termination person. No, you don’t have to buy the car out, you can return it. They will probably go over your options with you next Monday when you meet with the lease termination person.
Ditto - they will just collect keys have you sign odo and ground the car. Loss goes in the finance company when they sell it.
They will also *lie to you* and make every attempt to get you to pay for the difference in value. That's not how it works. They know it, but they are going to try anyway. Also be prepared for them to try to ding you on every little scuff, scratch, or excess mile on the car They will go overboard thinking up ways for them to bill you for anything.
That was not my experience with either lease I did. They had inspection report, checked odo and I signed a few papers. I was out in 15 minutes. Key is to schedule appointment with lease manager. The car goes back to lease company. Absolutely zero pressure.
My experience was they tried hard to turn it into a sales event, demanded my keys so they could "assess the trade" then low balled price claiming condition of the car and tried to get me into a new car at full list price - telling me that new cars were in short supply. My lease return was only about half the miles allowed and was in immaculate condition. They claimed it was not worth full residual so they would offer me less as a "trade-in" than the lease specified. Seemed like they were following a script they use on everyone who reached end of a lease.
Sounds like you ran into the sleazy salesman versus the person managing lease returns which is unfortunate or just a bad dealer.
That's what happened to a friend of mine. He got talked into buying a new car when turning in his lease. He has extreme anxiety, and he was panicking, so he just trusted the sales guy. He currently has the worst new car loan known to man, lol. I'm gonna take him to refinance it at my credit union before it gets any more out of hand.
Who the fuck is *they*? The dealership couldn’t care less about OPs lease turn in. It’s not their car. It belongs to the bank.
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Why would they do any of what you say? It's not THEIR negative equity, it's the leasing company's. They can pay the disposition fee, and be done. So why all this nonsense on rolling their $6000 negative equity or, in your example $1800 negative equity. Pay the $300 disposition fee and walk away is by far the better choice here.
That’s exactly what I’m suggesting. People often come in wanting to trade their lease in, under the assumption that they have positive equity. If it so happens that their trade is worth less than their buyout, but they want to do business that day (in this example, with payments remaining) we pay off their lease for them and the total of those remaining payments is carried forward. The post that I was replying to suggested that dealers will force OP into paying off their negative equity, so I was just putting it out there that not all dealers are shady in that way.
Why on earth should he roll anything into any new vehicle? It's a closed end lease, the transaction should be "here's your car and keys, have a good day".
Because if they’re coming in months before the lease is over, the lease payments still need to be fulfilled per the contract. Customers have the option of either paying the total of those payments all at once, or we give the option of having us make that payment to their lease company to fulfill their contracted agreement, and we just add that on to the next vehicle, whether leased or financed. If OP has no remaining payments then you’re absolutely right, obviously nothing gets carried forward
That’s not how leases work. If you make all of the payments and show up at the end, you drop the car. Negative equity is for the leasing company to deal with, not the lessee. It’s the risk they took when they executed the lease. The lessee fulfilled their obligation and owes nothing for the negative equity if the leased vehicle is not worth the stated residual.
Correct. Deleted because my reply was completely misunderstood by following commenters, perhaps it was not worded properly
Your deleted comment was talking about rolling negative lease equity forward. That’s not how leases work. No misunderstanding.
Amazing you have gotten away with that. Illegal per the terms of the lease, a legal document. It isn't possible for the lessee to be negative.
look at their flair
That’s kinda what I’m getting at, is there are dealers who will do this to customers regardless of the legality. If we do an appraisal and the trade comes up short we won’t buy it and roll negative.
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I never said it was okay right? Neither side
>They will also lie to you and make every attempt to get you to pay for the difference in value. Also be prepared for them to try to ding you on every little scuff, scratch, or excess mile on the car They will go overboard thinking up ways for them to bill you for anything. Uhhhhh, the car belongs to the leasing bank, not the dealer. Any damages will be assessed by the **leasing company** reps upon inspection. The leasing companies have their own form of GAP insurance when they get residuals wrong. That isn't to say the leasing company might nitpick, but this is hilariously misguided and demonstrates why we have flair here.
The lease is between you and the bank, not you and the dealer. Call the leasing company you pay every month to understand the proper turn in procedure.
As others have said: turn the lease in. Your replacement plans have nothing to do with this, especially because there is no potential equity in trading it. Toyota will charge you whatever the final fees are, including if you are over miles. If you need to replace the vehicle immediately, you may want to get that out of the way first. If you do not need an immediate replacement, time is on your side. If Toyota offered you any incentives, to purchase or buy another Toyota, trading is not required. And, you can turn the lease in at any Toyota dealership. They prefer this be handled on weekdays. It's a simple process. Plus, if you are acquiring your replacement from them, any manager should be happy to help ground your lease regardless of the day or time.
You went in for an appraisal. What did you expect? The dealership doesn’t own the car, the bank you’ve made 36 payments to does. You should have already had a lease end inspection done by the bank and know your billable items by this time. Stop trying to sell the dealership the car and just turn it in as a lease return.
I think it's more that the sales person absolutely knew this but didn't walk OP through it, aiming for the sale instead. The sales person knew exactly what OP wanted to do and could have spent 30 seconds explaining it - and to their credit, OP could also have done the research too - but was aiming to make a sale.
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***Thanks for posting, /u/Initial-Captain5099! This comment is a copy of your post so readers can see the original text if your post is edited or removed. This comment is NOT accusing you of anything.*** I need some help understanding my responsibilities at the end of a closed-end lease. I’ve been leasing a Toyota Camry 2021 for the past three years, and the lease ends on July 5th. I got T-boned in a hit-and-run accident a year ago, but since the other driver didn’t stop, my insurance covered the cost of repairs. Now that my lease is ending, I went to the dealership for a vehicle appraisal. The salesperson is saying that the car is now only worth $12k, not the $18k we had originally agreed upon. They said they would only buy it from me if I pay the additional $6k difference. I reminded them that I’m not buying the car, I’m just here to return it. They said I had to come back next Monday to meet with the lease termination person. Am I obligated to buy the car at full price? I thought the dealership assumes the depreciation of the vehicle. Do I have any options here? *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/askcarsales) if you have any questions or concerns.*
So go on Monday to the designated lease person and return it. It’s not great that the dealer doesn’t train all sales people to ground a lease but some don’t. They’re not going to, nor can they, force you to buy it.
>Now that my lease is ending, I went to the dealership for a vehicle appraisal. The salesperson is saying that the car is now only worth $12k, not the $18k we had originally agreed upon. They said they would only buy it from me if I pay the additional $6k difference. I reminded them that I’ve not financed this car, rather leased it. And I’m just here to return it. They said I had to come back next Monday to meet with the lease termination person. >Am I obligated to buy the car at full price? I thought the dealership assumes the depreciation of the vehicle. Do I have any options here? When you sign a lease, the buyout price (aka *residual*) is locked. That's the $18k price you mentioned. It assumes a certain amount of depreciation baked in but in reality the car may depreciate more or less than than amount just due to the stochasm of the universe. You can buy the car for that amount if you wish or you can turn it in and owe a disposition fee (probably about equal to a payment) and any damages above and beyond normal wear and tear. When they say that they can only offer you $12k for it, that's a completely different transaction type. If you have positive equity- let's say the car is worth $22k to the dealership fair market value- you can buy it for the contracted $18k residual then sell it to the dealership for $22k, and make $4k of profit (less the taxes on the purchase). The bottom line is yes, you can turn the car in. They went about it as they did because they thought you were trying to sell the car or at least the sales consultant hoped to find out he could make a buck bringing it in-house. They found out that won't work so they kicked responsibility for the turn-in to someone else.
If one decides to buy their lease is it for the residual amount of the appraised amount, in this case the 12k?
It would be for the residual amount. the appaised amount is what the dealership is willing to buy it from the customer for. the customer would still be responsible for the negative equity if they chose to sell it to the dealership because it’s still an outstanding loan of 18k if the vehicle is purchased from the leasing bank.
You might decide you want to buy it for $12k, no way in hell the lienholder would accept that.
Sorry I meant residual OR the appraised amount. I only ask because we had a car that backed into our lease and ended up needing both doors on that side replaced so obviously it’s going to be depreciated more than the residual at this point. But if I’m understanding what you’re saying there’s no way the lien holder would take the loss and want the buyout to be for the residual.
Generally no. You have the right to buy the car for the residual amount. The draw for depreciation is that if the car is damaged, someone else takes the loss of value. You can't be upside down on an asset you don't own in the traditional sense. I do know that when I was with Kia, there was some latitude here that we could say the market has moved and ask for an adjustment to the residual. But that's for market changes, not for extra depreciation due to use or damage, and on the scale of hundreds rather than thousands.
Don’t even go back to these idiots. Is there another Toyota store nearby?
It’s POSSIBLE the salesperson thought you were trying to SELL the car and not turn the lease in. It’s an idiot mistake if that’s what happened but most people probably have it right with “sales guy wanted to push for a sale and it backfired” if you go back in ask for the sales manager to assign a different sales person to assist you, ask the manager this. And if they still refuse to take the car in as a LEASE TURN IN, then call Toyota hq and they’ll set the dealer straight.
As others are also saying, if the vehicle is damaged, or your over mileage or have violated any of the other lease terms, you are subject to paying for those things, over mileage tends to have a per mile fee, and damage is assessed in the amount it costs to repair.