How can I not get screwed (more) on this leased car?
November 7, 2008 9:40 PM Subscribe
Misleading lease-filter: I'm paying twice as much as I should with 23 months left on a 36 month lease with Volkswagon. Do I have any options to get out or decrease my payment?
Last year VW sold us on a 36 month Rabbit lease. I've got crappy credit, and the salesdude convinced me that if my girlfriend (who has tip-top credit) and I shared the lease, my credit would improve and we could refinance the lease after a year for a lower rate.
He crunched the numbers and offered us $400 for both of us, or $200 for just her. We nearly went with just her but he was incredibly persuasive and promised us that if we came back in 12 months, he would get us a better rate. He absolutely knew we had no intention of buying the car- he knows we wanted a different lease once this one was up, because we talked about it a lot. He promised us that we could refi the lease.
Fast-forward 12 months and today the salesjerk said that what he'd said was that we could refinance into a loan for the buy-out price of the car. No refinancing of the lease, not even if my girlfriend took me off the lease. He lied to us, and we're stuck for another 23 months in a lease for a car that we like, but are paying 2x what it is worth.
Do we have any options whatsoever?
I've considered leasetrader, but why would anyone consider trading for our lease since we were so obviously screwed on the payments? Moreover, VW Credit holds the original lease-holder responsible if the person they traded it to stops paying, so we could end up responsible for the payments regardless.
Last year VW sold us on a 36 month Rabbit lease. I've got crappy credit, and the salesdude convinced me that if my girlfriend (who has tip-top credit) and I shared the lease, my credit would improve and we could refinance the lease after a year for a lower rate.
He crunched the numbers and offered us $400 for both of us, or $200 for just her. We nearly went with just her but he was incredibly persuasive and promised us that if we came back in 12 months, he would get us a better rate. He absolutely knew we had no intention of buying the car- he knows we wanted a different lease once this one was up, because we talked about it a lot. He promised us that we could refi the lease.
Fast-forward 12 months and today the salesjerk said that what he'd said was that we could refinance into a loan for the buy-out price of the car. No refinancing of the lease, not even if my girlfriend took me off the lease. He lied to us, and we're stuck for another 23 months in a lease for a car that we like, but are paying 2x what it is worth.
Do we have any options whatsoever?
I've considered leasetrader, but why would anyone consider trading for our lease since we were so obviously screwed on the payments? Moreover, VW Credit holds the original lease-holder responsible if the person they traded it to stops paying, so we could end up responsible for the payments regardless.
I don't understand. The salesman said "you can have this car for $200/month if your girlfriend alone is on the lease, but for $400/month, you can have the same car and both your names on the lease?" And you decided it was worth twice as much to have two people responsible for the lease instead of one? That doesn't make sense.
If, however, that's what you did, then I think you're screwed. You can (and should) complain to the stealership and the BBB, but don't expect any results (particularly not from VW). Can you buy out the lease (for the buy-out price of the car) and then sell the car? Or is the buy-out more than the car is worth? (Take into account the money that you'll throw away in the lease over the next two years -- if you'd lose less than that by buying out the lease and then selling the car at a loss, you still come out ahead, as long as you can afford to take the financial hit right now.)
Treat it as tuition in the school of hard knocks (specifically, the "Always Read and Understand What You Sign" class). Be glad you didn't buy a house from this guy. And don't lease a new car that you can't afford to buy. Buy a late-model used car that you can afford. Preferably a Japanese (or maybe Korean?) late-model car.
IAAL, but IANYL.
posted by spacewrench at 10:37 PM on November 7, 2008
If, however, that's what you did, then I think you're screwed. You can (and should) complain to the stealership and the BBB, but don't expect any results (particularly not from VW). Can you buy out the lease (for the buy-out price of the car) and then sell the car? Or is the buy-out more than the car is worth? (Take into account the money that you'll throw away in the lease over the next two years -- if you'd lose less than that by buying out the lease and then selling the car at a loss, you still come out ahead, as long as you can afford to take the financial hit right now.)
Treat it as tuition in the school of hard knocks (specifically, the "Always Read and Understand What You Sign" class). Be glad you didn't buy a house from this guy. And don't lease a new car that you can't afford to buy. Buy a late-model used car that you can afford. Preferably a Japanese (or maybe Korean?) late-model car.
IAAL, but IANYL.
posted by spacewrench at 10:37 PM on November 7, 2008
Have you talked to the sales manager? If he tells you to take a hike, you might as well post the name of the dealership here. Then it gets in search engines and they lose business from the people who Google for info on the dealership.
posted by crapmatic at 11:01 PM on November 7, 2008
posted by crapmatic at 11:01 PM on November 7, 2008
i am confused also.
since this is a lease, your payment SHOULD be going toward the overall price of the car, shouldn't matter if it's $40 a month, or $ 400 a month
The higher monthly payment must be getting you to a lower balloon payment at the end of the term.
If this is the case, and you can't get out of it, your best option might be to plan on buying the car at the end of the least, since you presumably would have paid off the biggest chuck of it after 36 payments
I also think that we are going to see an end to leases very soon, so it might make sense for you to buy this outright, since it might be hard to get a car loan with crappy credit soon anyway
posted by Mr_Chips at 7:07 AM on November 8, 2008
since this is a lease, your payment SHOULD be going toward the overall price of the car, shouldn't matter if it's $40 a month, or $ 400 a month
The higher monthly payment must be getting you to a lower balloon payment at the end of the term.
If this is the case, and you can't get out of it, your best option might be to plan on buying the car at the end of the least, since you presumably would have paid off the biggest chuck of it after 36 payments
I also think that we are going to see an end to leases very soon, so it might make sense for you to buy this outright, since it might be hard to get a car loan with crappy credit soon anyway
posted by Mr_Chips at 7:07 AM on November 8, 2008
Mr_Chips, the extra money is going to a higher lease factor (interest rate, essentially).
Either that or they're using a different residual value based on the credit score, which isn't something I've ever heard of. If they were, and the lease is closed-ended, then buying it at the end of the lease would make sense.
IMO, the OP would be best off buying out the lease and selling the car if they're not upside down, then buying or leasing something else.
posted by wierdo at 3:16 PM on November 8, 2008
Either that or they're using a different residual value based on the credit score, which isn't something I've ever heard of. If they were, and the lease is closed-ended, then buying it at the end of the lease would make sense.
IMO, the OP would be best off buying out the lease and selling the car if they're not upside down, then buying or leasing something else.
posted by wierdo at 3:16 PM on November 8, 2008
I don't understand why having two people responsible for the lease would be more expensive than only one. Combined credit is better than either individual's credit because now there are two people who can pay the bill.
If you think you've been ripped off, you might lodge a complaint with your state's department of consumer affairs. Since there's a signed contract, I'm somewhat doubtful they'll be able to do much, but it's worth a shot.
posted by blue mustard at 4:08 PM on November 8, 2008
If you think you've been ripped off, you might lodge a complaint with your state's department of consumer affairs. Since there's a signed contract, I'm somewhat doubtful they'll be able to do much, but it's worth a shot.
posted by blue mustard at 4:08 PM on November 8, 2008
This thread is closed to new comments.
You should file complaints with the better business bureau and any online review source you can find. You can also trying raising a stink by speaking to people like Clark Howard. You could even protest in front of the dealership if you have time. I'm not sure if there is any way to challenge the salesman's' sales license with the DMV, but you might call them about it.
You key point is that he is lying about what he said before.
posted by jeffburdges at 10:11 PM on November 7, 2008