bclexus

I'm not Dave, but...when the dealer pays Lexus Financial the remaining obligatory contractual payments, that money ultimately comes from the lessee of the car that was returned early. The money for those remaining payments will likely be setup to come-in over a greater period of time equal to the customer's new lease term (e.g. 24 months). And the dealer will calculate interest on the remaining amount owed and be figured-in to the new car lease payment to compensate for the use of money that goes to payoff the lessee's debt obligation on the old lease. The tail-of-the-tape is: You can bet your bottom dollar that the amount of money still owed on the old lease vehicle that was returned early will most definitely be tacked-on or rolled into the leasing payment for the new car being leased. The remaining payments on the old lease are not just forgiven...or paid by a Good Samaritan.

dchar

Dealers don't "eat" anything. When Lexus (or any car maker) says they'll pay the remaining payment, they really mean they'll factor it in on your new car. Same goes with excess mileage from lease. It's usually in the form of additional down or few dollars tacked onto monthly payment. When they say they'll waive the last few payments, that really means they'll recalculate it and not charge you penalty for ending lease early.

Dave Mac

"Dave, if the dealer pays Lexus Financial the remaining payments how is that not the dealer eating them? "

I understand what you are saying but what I mean is that if the dealer either "pays" some remaining lease payments or in my case the excess mileage or lease-end charge he/she is not eating anything - I am, because at least in theory that same amount of money would have come to me as a better deal.

I have a friend that leases from the same sales person as I do who often tells me that he never has to pay for excess mileage or early turn-ins so I asked the salesman what the deal was - he just raised his eyebrows and said "he pays, everyone pays, not us" which I took to mean they are just rolled into the new deal.

Dave Mac

modthispny

you're right. usually when you trade it for another car of the same brand, the lease rates are usually a lot cheaper and even when they tack on the excess miles, payment, etc, you still pay less than what you were paying, case in my point my situation.

modthispny

so my mistake here was doing an early lease trade in, but if i had kept my lease until the end i would have been about 5-6k miles over, which comes out to around 1,250 - 1,500, so technically i only got ripped off by about $900 now.

jjscsix

I actually did not explain myself clearly. Yes, I meant that the dealer is eating it and therefore must pass along the cost of eating it to the buyer. I Apologize. In retrospect we probably meant the same thing.

pbm317

Dealers and banks typically don't "eat" payments, generally, even with a lease, there is an option to buy out the remaining value of the car at any point in time.

If you traded in for a new lease early, your dealer would have called Lexus Financial to determine the buyout, look at what they're giving you as a "trade in" value and then see if there's a gap. Now there's a chance that it could have worked out to exactly what you owed in payments, $2,400 in this case, but that seems like a pretty big coincidence. Seems like they did some "easy" math to boost their profits of rolling your $2,400 into the new car lease as well as taking the car in. Again, it all depends on what the current market value of the car is versus whatever the lease balance value is.

modthispny

initially they were doing a trade in, and i was about 5-6k upside down which didn't surprise me, but then when i told them i had 4 payments at $600 they just did that instead. It was in the due bill, that they had to pay off my LFS account number. When i checked my LFS account online i saw a payment of 2,400 too.

so all in all i would have been better off just turning my lease in when it was due, but then i would have had some mileage overages.

Chardo

My ES300h lease ends in under 4 months. I hold in my hand a letter from Lexus Financial, with waiver certificate, saying "To show our appreciation, we're waiving up to 3 months of your remaining monthly payments on your current Lexus if you lease or finance a new Lexus through your participating dealer and LFS."

Already got a call from the dealer, who knows about the offer, asking if I'm interested in something new. No games or add-ons, new car deal will be as if I had no other car. Lexus Financial is voiding the remaining payments, nothing to do with the dealer. Basically I'm a free agent right now if I want a new Lexus, just as I would be a free agent in 3 months with any other make.

Joeb427

iTrader: (1)

I'm surprised no one in this thread knew of that offer.It's not uncommon for auto manufacturers to have that program.I've seen ads from some manufacturer offer even more months to get out of a lease early..