No credit card required
Browse credit cards from a variety of issuers to see if there's a better card for you.
This may be a first for me next year and wanted to see if anyone here can provide some clarification. When leasing a new vehicle, how does it work when you have a trade-in with positive equity? Do they take the equity and apply it to the monthly payment? As in say you have $5000 equity and a $600/month lease payment on a 36 month lease, they divide that $5000 into 36 months and subtract it from the monthly payment for it to come out as $462/month. Or do they apply it to the whatever the 36 month balance would be?
They use it to reduce the capitalized cost. I have had equity going into a new lease but just had them cut me a check for the equity.
@Gladius wrote:This may be a first for me next year and wanted to see if anyone here can provide some clarification. When leasing a new vehicle, how does it work when you have a trade-in with positive equity? Do they take the equity and apply it to the monthly payment? As in say you have $5000 equity and a $600/month lease payment on a 36 month lease, they divide that $5000 into 36 months and subtract it from the monthly payment for it to come out as $462/month. Or do they apply it to the whatever the 36 month balance would be?
Usually applied as cap cost reduction like the other poster stated, which is your first scenario above. I would also ask for a check back or better yet, sell the car prior to going in. Try to only put TT&L down on a lease, cap cost reduction is wasted money should the car ever get totalled. GL
@sccredit wrote:They use it to reduce the capitalized cost. I have had equity going into a new lease but just had them cut me a check for the equity.
Yes. I was also thinking of that possibility. I will be taking my car to either CarMax or Carvana to see how much they will give me so I will have an idea of what my equity is.
@Gladius wrote:
@sccredit wrote:They use it to reduce the capitalized cost. I have had equity going into a new lease but just had them cut me a check for the equity.
Yes. I was also thinking of that possibility. I will be taking my car to either CarMax or Carvana to see how much they will give me so I will have an idea of what my equity is.
I had a CarMax offer in hand and my Infiniti dealer offered to match it for convenience (and profit obviously)