Help me get the best deal when I (maybe?) buy-out my leased vehicle!
October 17, 2013 12:26 PM   Subscribe

I am 35 months into a 39 month lease with a 2011 Nissan Maxima. This is the first vehicle I have ever leased/owned on my own so would like any hints/tips that will help me in the next few months as I prepare to either buy out my lease, or go in another direction.

Additional details:

- I am significantly under the mileage limit. The lease allowed for 1,000 miles per month, and in about 35 months I have 26,000 miles on the vehicle.

- I would like to reduce my monthly payment, but this is not essential. What are my options, down-grade? Buy and re-finance? I work for a Federal Agency that has a Credit Union that does these sort of things. I'm assuming part of the research I will be doing over the next couple months may involve them, or maybe my bank as well.

- The vehicle is in good condition. The interior has no damage, the outside has a couple mostly-minor scratches. I don't think it will be a major issue, but as I am new to this process I don't fully know what to expect. I'm expecting them to try and get whatever they can out of me, as per usual from car dealerships.

If there are additional details that would be helpful I can provide them as well.
posted by OuttaHere to Travel & Transportation (4 answers total) 1 user marked this as a favorite
Do you know what the lease buy-out price is? How does it compare to the KBB or Edumunds price to purchase that vehicle?

When I bought out my lease the dealer charged me for some kind of BS "conditioning" so that it could be certified "pre-owned." I'd skip that crap again in a heartbeat.

You may have to re-pay taxes if you choose to purchase. I'd go into the credit union and discuss it with them. They can tell you what your payments will be and they may be able to direct you to a dealer who won't start charging a bunch of crap.

It might be a great time to buy out your lease NOW.

Here's the thing, everything depends on residual value. That's the value of the vehicle as it is today.

If it would cost you less to buy a different vehicle in similar condition, don't buy out your lease. If it would cost you more, then buy out your lease.
posted by Ruthless Bunny at 12:35 PM on October 17, 2013 [1 favorite]

When I bought out a lease on a minivan 10 years ago the dealership had a lease service company that did all the work. I wanted to keep the van, but I didn't tell them that. I claimed slight interest, if they made me a really good deal. The next day, they faxed me an offer, and it was a really good deal so I took it.
posted by COD at 12:50 PM on October 17, 2013

If you like the 2011 Maxima, go to the dealership now (and other Nissan dealers in your area) and check out their used selections of that model. Look for cars that have the same trim level and similar mileage to your own car. Write down the price and take a photo with your phone of the full sticker including trim and mileage, then go online and look for blue book retail values for the same car, just to see if they are marking up the car more or less than the "average" dealer according to KBB or Edmunds. Remember that certified used cars typically have a higher markup than new cars, so the price is probably even more negotiable than you might think.

When you go back to trade in your own car, see what they are willing to offer as a buyout price. If it's higher than similar cars already sitting on the lot, either pull out your research and haggle, or just walk away. Your main point here is that it would be absurd for you to hand in your car and buy the same model off the lot for less - especially because you're saving them the trouble of doing additional maintenance and cleaning on your car before they can resell it. Another point in your favor is your own low mileage. In essence, you have already paid (through your lease payments) for wear and tear that hasn't happened yet - so you shouldn't be re-paying for those same miles in your buyout.

If the buyout price is lower (and still not higher than average blue book retail values), and you like the car, keep your mouth shut about your other research and either try to haggle the price down further or just make the deal!

Definitely arrange pre-approved financing through your credit union or bank in advance. Once you know from the bank what your loan terms and monthly payments will be, you are armed with everything you need. But don't bring this up until you've already settled on the purchase price to buy the car. Dealers will sometimes not go as low on a price unless they think they will get something else back in the financing.

Unlike buying a new car, you can't vary the trim level or other options, so he will only be able to move two numbers around in your negotiation - the total purchase price and the length of the loan term (of course, you aren't financing through him, but he doesn't know this). Continue to focus on the purchase price, not the monthly payment or length of the loan. Once you settle on your purchase price and you go to the finance office and you have the purchase price in writing, then you can pull out your pre-approval papers and simply hand them over.

I would suggest doing all this at least a week or two before you have to hand in the car - if the negotiations fall apart you don't want to be stranded car-less and put in a weak position in the negotiation - if the dealer knows you still have time to go elsewhere they will be more willing to work with you.
posted by trivia genius at 1:14 PM on October 17, 2013 [2 favorites]

I've bought out two leased vehicles and plan to buy a third at end of term. In my experience the pricing has been very fair. The residual value is established up front (it has to be -- the amount you pay over the lease is the difference between the sale price and the residual value) and is not negotiable. The residual should be in your lease contract -- find it and make sure it matches with what they quote you.

If you like the car, I suspect it's probably a good buy especially since you're well under on the mileage. It should be considerably less expensive than returning it and then buying a similar used car, but it's worth checking on to be sure. As far as buying it goes, it's just like buying any other used car. You can decide the length of the loan, and you will owe taxes on the purchase amount.

One of the ones I bought was actually a friend's lease that I bought out a few months before the end of the term. They just had a buy-out price for each month of the term, and the very large national bank that financed his lease happily sold it to me early for that amount.
posted by LowellLarson at 2:10 PM on October 17, 2013

« Older How to send money from my Japanese bank account...   |   Mom went to hospital with difficulty moving legs... Newer »
This thread is closed to new comments.