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Looking for advice. Wayy over milage on lease!

Contributor

Looking for advice. Wayy over milage on lease!

Hello gurus,

 

I need some advice. I have been diligently working on my credit this entire year and have brought it up from 570s to mid 600s (see sig below). By month's end, it should be slightly higher as I will move from approx 26% total UTI to just under 20%. Also I was able to successfully get a small $147 collections removed recently. 

 

Background: 

I have build a stellar relationship with Chase over the last several years leasing a brand new 2016 Mazda CX-5 (which I love) back in Sep 2015. I've recently taken them up on the offer to extend my lease for 6 mos and keep everything the same, with the ability to still end it/trade up at any time. All payments were made on time over the last 3+ years. I've also managed a checking account with direct deposit and a Chase Freedom Unlimited credit card with $1k CL also with all on-time payments and PIF since March of this year.

 

Just recently (Aug 2018) I had green check marks for the CSP and CSR credit cards with chase online and was approved for the CSP with a $5k CL. I put heavy spend on these two CC's using them like debit cards and always PIF, and have never missed a single payment with Chase. Seems I have a great internal score with them (which was exactly my goal) when I started my CX-5 lease because I knew that'd I'd most likely want to get another CX-5, except the grand touring version with all the bells and whistles, but at a great deal.

 

I think it's also important to note, I have another joint loan for another vehical from the same dealership that I purchase the Mazda at, but this loan is with Santander and my (ex) girlfriend has been responsible for these payments and had a late payment back in Nov 2017 and again in Feb 2018. We have a good enough relationship where she won't default on it and the reason for the lates was because she was out of work and asked for alternate payment options and I even had to step in and pay once.

 

My situation:

My current Mazda lease is wayyyy over the 36,000 alotted milage agreed in the original lease. I currently have about 64,000 miles on the vehicle. I will spare the details of how this happened for now, but my situation and amount of driving I do has changed drastically several times during the term of my lease. I am currently in a position to be able to stay within milage limits if I got a new lease, but not sure if I should just finance now since I know I love the CX-5s so much and would like to add custom stuff to it down the line? However, I think it would be more advantagious to me if I were able to lease initially and start off with a lower monthly payment and then opt to purchase at the end. 

As for being over the milage allowance big time, what strategy can I use to still negotiate a great deal, without having to pay for milage? Or, will my best option be to purchase my current vehical (as to avoid paying for milage overage) and then trading my current car in for a new mazda lease/finance? I am also open to financing a barely used 2018 CX-5 with less than 15K miles on it in order to cut costs. Are dealers able to work these kinds of deals into one transaction? Does my credit profile support this?

 

Personal income is $44K, household is $90K - but I would prefer not to include household income on the app as I don't want my girlfriend co-signing on this new vehicle for me.  I think my DTI ratio is sitting nice between 20-25% right now. Do I have to include the payment for the joint auto loan in this DTI calculation since I don't really pay that?

 

Thanks!

 

 

 

 

 

Current: Gardening...


FICO 8:

As of 12/2/2018. Total CL: $13,300; Goal: $50,000
6 REPLIES
Frequent Contributor

Re: Looking for advice. Wayy over milage on lease!

I don't have much experience with leases so I will let other's chime in on that part.

 

As far as the financing end, you cannot use your girlfriend's income (total household income) unless she is on the loan. You will only be able to use your income, secondly, your DTI will in fact count for the joint auto loan that is her's, as you are still responsible for the repayment of that loan regardless of who drives it or who pays for it.

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Message 2 of 7
Valued Contributor

Re: Looking for advice. Wayy over milage on lease!

Time to gather some information:

Current KBB value of your current car. You may also want to swing by a CarMax to see what their FREE cash offer to buy your car comes to.

Check your lease aggreement for cost of purchasing your car.

 

My guess is since you are approaching doubling the mileage on your lease you will need to arrange financing to purchase your car.

 

You can use the current girlfriends income for a credit card (household available income) but not for an auto loan. 

 

And yes, even though you are not paying for the (ex) girlfriends car you still have the liability of paying if she does not/can not. 

So, when figuring out your DTI make sure you include the co-signed loan (it will show up on the credit pull) and take into account the cost of the new loan. You can subtract out your current loan if that will be paid off as a trade in.

 

 

Message 3 of 7
Moderator

Re: Looking for advice. Wayy over milage on lease!

Initial guess is you are going to have to purchase the vehicle.  Echo what Appleman says

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Message 4 of 7
Contributor

Re: Looking for advice. Wayy over milage on lease!

Thank you all for the replies so far! 

I'm curious if anyone who's been in this situation can share some insight? Ie. Is it possible to either a) take the fees from excess milage and roll them into the new loan or b) will the dealership be able to do a transaction as if I were going to purchase my current vehicle, and then turn around and trade it in for the new one (all in one, or possibly two transactions)?

 

 

Current: Gardening...


FICO 8:

As of 12/2/2018. Total CL: $13,300; Goal: $50,000
Message 5 of 7
Valued Contributor

Re: Looking for advice. Wayy over milage on lease!

If you are trading it in you do not need to purchase it first (you would actually have to pay sales tax on it if you did, thus increasing your payoff).  Just trade it in like you would any other car purchase.  

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Message 6 of 7
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Contributor

Re: Looking for advice. Wayy over milage on lease!


@sccredit wrote:

If you are trading it in you do not need to purchase it first (you would actually have to pay sales tax on it if you did, thus increasing your payoff).  Just trade it in like you would any other car purchase.  


I agree. I think I'm just overthinking it now. It should be business as normal. Thanks!

Current: Gardening...


FICO 8:

As of 12/2/2018. Total CL: $13,300; Goal: $50,000
Message 7 of 7