Finance Questions

Posts Tagged ‘finance lease vs operating lease’

Question: Can I get out of my Finance to Lease a new car?

Hi, I am financing a 2005 Buick Century and would like to know if there is any way that I would be able to end my finance and lease a new vehicle. My payoff amount is $14,000, and the vehicle is worth around $11,000. Would they just tack the extra $3,000 onto my lease or is this not possible? What can I do? Thanks!

Answer: If you are currently financing the Buick, you will need to use it as a trade-in. You will be responsible for the difference between the dealer's trade-in off and your payoff. Assuming your dealer offers you $11k, your negative equity will be $3000. It is also possible that the dealer will offer you less than the $11k you seek, making your negative equity that much more. Then when you lease your new vehicle, they will roll that amount into your cap cost (sale price) and you will be making lease payments based on that.

I advice against doing this however. You may be better off selling the car privately so you can get more money for it. Then payoff the remainder of your Buick's loan and lease a new car altogether. Otherwise, your monthly payments will be a lot more than you expect. When leasing, you do not want to carry over negative equity from a previous car, you want make the selling price the lowest as possible, keeping your monthly payments low.

Atlanta Owner Finance, Lease Option, Rent To Own