Selling a leased Wrangler

[Wrangler847]

I don't have any plans of doing this I was just wondering how it works because I was reading up on it. If my residual is 32k and I owe $8k left on my lease payments until Feb of 2020 does that mean if I sold the Wrangler for 38k I would get back 6k for myself after I pay the leasing bank or do I still have to pay the total remaining $8,000 in remaining payments?

Sponsored

 

[Digger70]

The bank or dealer has the title so unless you're friends with the buyer the average person isn't going to give you $38k and assume you'll pay off the loan and then give them the title after you get it. Disregard, I wasn't thinking of a leased vehicle. Not sure what you'd do. I'll see if I can find some links.

 

[Rploaded]

I don't have any plans of doing this I was just wondering how it works because I was reading up on it. If my residual is 32k and I owe $8k left on my lease payments until Feb of 2020 does that mean if I sold the Wrangler for 38k I would get back 6k for myself after I pay the leasing bank or do I still have to pay the total remaining $8,000 in remaining payments?

Call them and ask what your buyout is. They will give you a quote. Then you would need to pay that amount to get a released title.

 

[Digger70]

https://www.jlwranglerforums.com/forum/threads/getting-out-of-my-lease-early.8012/

 

[Wrangler847]

The bank or dealer has the title so unless you're friends with the buyer the average person isn't going to give you $38k and assume you'll pay off the loan and then give them the title after you get it. Disregard, I wasn't thinking of a leased vehicle. Not sure what you'd do. I'll see if I can find some links.

I understand but what if I had $7,000 in upgrades and found a buyer or say dealer gives me $36k(unlikely)

 

[Shooting or Jeeping]

Yes, the above information. You are “buying” a portion of time in a lease- not the actual vehicle. So if you want to sell it, you’ll need to gain ownership by buying out the lease. Now, technically someone can do that by buying from you, but that’s not typical. For them, it’s an added step and hassle to pay you to pay them to have you sell it to them. Contact your leasing lender and discuss the buy out. You may have to go to the dealer to complete this. They stock it in and then sell it to you officially in many states. From there, you can sell it.

The odd but quicker way is to pay off your lease and turn it in. But that’s kinda dumb. You’d pay for your time and then not use it after you paid it. But it does end your lease.

 

[Digger70]

I understand but what if I had $7,000 in upgrades and found a buyer or say dealer gives me $36k(unlikely)

Lol good luck with that. Dealers usually don't give extra for 'upgrades'

 

[Wrangler847]

Lol good luck with that. Dealers usually don't give extra for 'upgrades'

I know. I'm not doing this I'm just trying figure out how it works. If they could sell it for even more though wouldnt they ?

 

[Digger70]

I know. I'm not doing this I'm just trying figure out how it works. If they could sell it for even more though wouldnt they ?

They could try but when I traded in my '15 JK it had heavy duty front and rear bumpers, 3" lift and aftermarket wheels and tires. They gave me the KBB value and sold it for about $3000 more.

 

[Shooting or Jeeping]

I know. I'm not doing this I'm just trying figure out how it works. If they could sell it for even more though wouldnt they ?

A dealer won’t pay for upgrades in almost all cases. You’ll notice there is a provision in your lease for that. When you turn in your lease, the dealer is required to return it to the leasing company. They can, however, ask to buy the vehicle and stock it. So if they feel it is worth the margin, they buy and then sell it. In between, the add ons are nothing to the leasing company. The dealer ultimately can pass on doing anything more than putting the keys in a box for the transport guy to grab on a monthly basis.

 

[Digger70]

Modding a leased vehicle that you don't plan to buy is a waste unless you plan on removing the mods before you turn in the vehicle.

 

[Durango]

Trading in or selling to a dealer, a leased vehicle, is really for all intensive purposes, not all that different than if you own the vehicle outright, or took out a loan to buy it. It has a value to the entity who leased it to you that the lease determines mathematically, and anything above that amount a dealer is willing to give you for it, is yours once they pay the leasing entity what is owed them. (just like if you choose not to turn it in, but to sell or trade it, it is possible you could owe them money to get out of it early) With a lease, what you owe (if you turn it in, and what is owed on it in an early termination) is based upon what they calculate it's value will be throughout and at the end of the lease, ahead of time. If you own or are buying it, what you owe on it is determined by the loan against it. As with a lease, if they value it over what you owe on it, then you get anything over what is owed on it.
So you might get more for it (and therefore have more going to your pocket or against a new one) if you have a lot of accessories - after all, some are designated as having a value by KBB and Manheim and...,but don't expect anything near what you put into it, since most accessories don't add value on the market.
Basically, what someone who wants to buy it from either you or the leasing entity (depending on how you possessed it) is willing to pay, is determined mostly by the market value - but as a lessee or someone who took out a loan to purchase it, what you get back after satisfying the lease or the loan, is determined by what that lease or loan is mathematically determined to be owed at any point in its term. The thing with a lease is that it is designed primarily to have you rent the vehicle so that at the end of the lease, the vehicle still has value that must be satisfied in order to buy it - whereas when you take a loan out on a vehicle to buy it, when that loan is paid off in full, there is no more money owed to get the vehicle. That's why you can lease a vehicle for a lot lesser monthly payments than if you buy it - money is still owed once the lease is done.

 

[Shooting or Jeeping]

Trading in or selling to a dealer, a leased vehicle, is really for all intensive purposes, not all that different than if you own the vehicle outright, or took out a loan to buy it. It has a value to the entity who leased it to you that the lease determines mathematically, and anything above that amount a dealer is willing to give you for it, is yours once they pay the leasing entity what is owed them. (just like if you choose not to turn it in, but to sell or trade it, it is possible you could owe them money to get out of it early) With a lease, what you owe (if you turn it in, and what is owed on it in an early termination) is based upon what they calculate it's value will be throughout and at the end of the lease, ahead of time. If you own or are buying it, what you owe on it is determined by the loan against it. As with a lease, if they value it over what you owe on it, then you get anything over what is owed on it.
So you might get more for it (and therefore have more going to your pocket or against a new one) if you have a lot of accessories - after all, some are designated as having a value by KBB and Manheim and...,but don't expect anything near what you put into it, since most accessories don't add value on the market.
Basically, what someone who wants to buy it from either you or the leasing entity (depending on how you possessed it) is willing to pay, is determined mostly by the market value - but as a lessee or someone who took out a loan to purchase it, what you get back after satisfying the lease or the loan, is determined by what that lease or loan is mathematically determined to be owed at any point in its term. The thing with a lease is that it is designed primarily to have you rent the vehicle so that at the end of the lease, the vehicle still has value that must be satisfied in order to buy it - whereas when you take a loan out on a vehicle to buy it, when that loan is paid off in full, there is no more money owed to get the vehicle. That's why you can lease a vehicle for a lot lesser monthly payments than if you buy it - money is still owed once the lease is done.

You are right in theory, but not implantation. The residual is calculated and you pay the lease payment based on the time you choose. That part is correct. However, residual doesn’t calculate aftermarket unless already in the contract. So if you turn it in with tons more- they don’t have to do anything. It’s not on the contract. The dealer is the second in line. They contact the leasing company and can buy it from them and sell to you. Most charge 500 or so to do this. Again, at this level- who’s paying for the aftermarket and why? So your only option is to buy it from the dealer after they buy it from the lender and then you can sell it with the bump for aftermarket. Until then, the lender is not contractually obligated to pay a dime to you for anything, and the dealer can buy it from the lender without aftermarket mark up.

 

[Durango]

You are right in theory, but not implantation. The residual is calculated and you pay the lease payment based on the time you choose. That part is correct. However, residual doesn’t calculate aftermarket unless already in the contract. So if you turn it in with tons more- they don’t have to do anything. It’s not on the contract. The dealer is the second in line. They contact the leasing company and can buy it from them and sell to you. Most charge 500 or so to do this. Again, at this level- who’s paying for the aftermarket and why? So your only option is to buy it from the dealer after they buy it from the lender and then you can sell it with the bump for aftermarket. Until then, the lender is not contractually obligated to pay a dime to you for anything, and the dealer can buy it from the lender without aftermarket mark up.

Gotta beg to differ - I used to lease vehicles all the time, and more than once when terminating early by trading or selling to a dealer (those are two different scenarios) I got more money than what the residual was calculated to be, based on the market value which was added to by the accessories the vehicle had. What anyone be it a dealer or otherwise, is willing to pay for a vehicle changes almost from minute to minute, and can be what is owed, less than what is owed, or more than what is owed - and often if it's more than what is owed (possibly helped by accessories) it is due to the market for that vehicle being high at the time for a variety of reasons. (and high with low availability) Everybody's situation is different, so it never hurts to ask. For example, I deal with the same dealer all the time, and they agree on a value they will credit me in a trade, or simply cut a check for, on a vehicle I am selling without ever seeing the vehicle. They don't do that with everyone, but they've learned I won't screw them so we negotiate in good faith on all sides. And sometimes a dealer already has someone they know will buy a particular vehicle so they are motivated to pay more than the minimum because they know they will make money when they sell it to the person they have "waiting in the wings".

On a related note - in CA when you lease a vehicle, you are only paying sales tax on the amount you pay in the monthly lease payment - if you choose to the pay that vehicle off (buy if from the leasing entity) then you have to pay the sales tax on the amount you pay to buy it. That can be a bit of surprise if you're not expecting it.

 

[TimmH]

I don't have any plans of doing this I was just wondering how it works because I was reading up on it. If my residual is 32k and I owe $8k left on my lease payments until Feb of 2020 does that mean if I sold the Wrangler for 38k I would get back 6k for myself after I pay the leasing bank or do I still have to pay the total remaining $8,000 in remaining payments?

Yes, you can buy the vehicle for 32k, but your still under contract for the 8k in lease payments.

Otherwise everyone would lease a 50k vehicle then the next day pay the 32k buyout and save 18k.

Sponsored