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Lease Buyout

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Kree
Established Contributor

Lease Buyout

In a few months I may need to buyout my lease. The fiance left a few dings and scratches, and I fear the repair charge and turn in fee will be more than I want to pay.  The buyoff price is actually pretty reasonable.

 

I went ahead and ran my information through Capital One's auto navigator. Got pre-qual for more than I need at a healthy APR 4.9,  but looking around the site afterwards I realized they specifically prohibit the loan to be used for a lease buyout.

 

My next thought is to check with USAA, but I was wondering if you all could recommend lenders so I do not need to wade through the fine print.

Message 1 of 8
7 REPLIES 7
Anonymous
Not applicable

Re: Lease Buyout


@Kree wrote:

In a few months I may need to buyout my lease. The fiance left a few dings and scratches, and I fear the repair charge and turn in fee will be more than I want to pay.  The buyoff price is actually pretty reasonable.

 

I went ahead and ran my information through Capital One's auto navigator. Got pre-qual for more than I need at a healthy APR 4.9,  but looking around the site afterwards I realized they specifically prohibit the loan to be used for a lease buyout.

 

My next thought is to check with USAA, but I was wondering if you all could recommend lenders so I do not need to wade through the fine print.


I find that strange about CapOne.  How would they even know it was a lease buyout? I can only speak from my experience in the business in the Maryland but end of lease purchases are treated like you’re buying a used car and a subsequent creditor would have no idea that it was from a previous lease. No different than buying any off lease used car.  I guess it all depends on how it is processed in your state.  Are you buying the car from the leasing creditor or from the dealership?

Message 2 of 8
Kree
Established Contributor

Re: Lease Buyout

I was going to buy it from the dealer, figured I would give them the chance to waive damages and put me into something larger. I think it has to do with their "approved dealers" and "existing inventory" requirments.  The buyout won't show up in dealerstock, so C1 can't prequal the car.

 

The main reason I checked with C1 is because of the SP, I'm not quite ready to commit to inquiries yet, plus I've been banking with them ever since Chevy Chase Bank was aquired, so I figured a long history doesn't hurt.

Message 3 of 8
Appleman
Valued Contributor

Re: Lease Buyout

I have found that PenFed has given me better rates than USAA.

 

If you do not currently belong to a credit union, it would be a great time to get on board with PenFed. 

They do one HP (hard pull) of your Equifax report and they will use that pull for multiple products including Membership, an auto loan, a credit card and even a line of credit if you so desired. Most/any other CU/Bank would be a HP for each additional product.

 

Just my 2 cents

Message 4 of 8
DeeBee78
Valued Contributor

Re: Lease Buyout

If you have a 700+ EQ Auto 5 score, you can get DCU's best rate of 2.24% on a lease buyout. 

Message 5 of 8
Kree
Established Contributor

Re: Lease Buyout


@DeeBee78 wrote:

If you have a 700+ EQ Auto 5 score, you can get DCU's best rate of 2.24% on a lease buyout. 


Aha, my best score at 748.  I was planning on waiting until after my next update to maximize points. But if DCU uses Auto5, then I might get the ball rolling early. Much thanks!

Message 6 of 8
Kree
Established Contributor

Re: Lease Buyout

So i applied for a loan, they asked me to join, so I applied to join, and am now a proud DCU member.

 

However, on my auto loan application it is asking me to verify information by uploading a "Purchase & Sales Agreement".  I don't think I can get one of those until after I attempt to purchase the vehicle, but don't I need the loan verified to purchase the vehicle?  This feels like a chicken/egg situation.

 

Is anyone familiar with DCU's practices?  Am I misunderstanding what they are looking for?

 

Edit:  I called DCU, got approved for 2.99%, they just need a "buyers order" to complete the loan.   So I will contact the dealership, let them know I want to purchase the vehicle, and get that written up. A relief.

Message 7 of 8
DeeBee78
Valued Contributor

Re: Lease Buyout


@Kree wrote:

So i applied for a loan, they asked me to join, so I applied to join, and am now a proud DCU member.

 

However, on my auto loan application it is asking me to verify information by uploading a "Purchase & Sales Agreement".  I don't think I can get one of those until after I attempt to purchase the vehicle, but don't I need the loan verified to purchase the vehicle?  This feels like a chicken/egg situation.

 

Is anyone familiar with DCU's practices?  Am I misunderstanding what they are looking for?

 

Edit:  I called DCU, got approved for 2.99%, they just need a "buyers order" to complete the loan.   So I will contact the dealership, let them know I want to purchase the vehicle, and get that written up. A relief.


Glad you were able to get it sorted out. You'll probably end up closing the loan at the dealership, because they won't write up the buyer's order until all final prices are agreed on. DCU will then close the loan with you over the phone.

 

When it comes to the residual, that's all negotiable as well. Despite the dents and dings, you still hold the power to walk away. You should see what Carmax offers for it, just so you have an idea of what you could get for it if you sold it instead. Sometimes at the end of the lease the car is worth less than the residual, and you should negotiate the price down. 

 

When my lease is up, I'm pretty sure that my car will be worth more than the residual, so I might just sell it to Carmax and make a few hundred dollars. 

 

 

Message 8 of 8
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