cladd

than the orig negotiated resid value? I took over a hummer lease. The resid value is high which was great for the orig guy, but I think it's above market value. Will they just take a loss rather than sell it for less to the leasee?

911Dave

The residual value is just an arbitrary number used in the calculation of the lease payment. Once the lease it up, it becomes irrelevant. The price of a car, regardless whether it was a lease turn-in or a trade-in, is always negotiable. If the leasing company doesn't sell it to the lessee, they'll most likely sell it at auction for much less than the residual value that was stated in the lease. HTH.

Paul S.

991Dave, you're just being too logical. The leasing company should sell to the existing lessee for what the car's worth, when the residual is higher, but depending on the lessor they very well may not. Crazy--yes.

All one can do is ask and see. But don't be stunned if the answer is, you can return the car or pay the residual buyout.

Jerry Fisher

I tried "negotiating" the residual on an Audi--they said---we are insured for residual loss--pay or walk.

Alan Smithee

MB Financial offered to sell me my last leased car at much less than the residual; the price they offered was fair market value, but I wasn't interested in keeping it and didn't take them up on it.

BSL

The short answer is it all depends on the leasor. If the lessor doesn't want to pay full residual, generally the vehicle will be sold through an auction set-up (virtual or physical), as this is the most efficient way of obtaining the highest market value for the car.

It is worth trying to negotiate, but don't expect to purchase the vehicle for a wholesale price. Also, if it is through GMAC, they price their leases for about a 95% return rate, expecting to get everything back. If it is with a bank, there is a good chance they are insured for residual loss, as Jerry was told (not sure if his was a bank or VW Credit--who isn't insured--though).

Gerg

I am considering assuming the lease on a 2005 C2S and asked this very question of the bank today. I was told that they (US Bank in this case) would call the lessee about twelve months before the lease expires to determine what they want to do at lease end, and that a buy-price "could be negotiated at that time".

onedae

I tried to buy 2 cars in the past from Porsche Financial when the leases were up. The first was a 95 993 and the second was a 99 996. Both cars had significantly higher residuals than market and in both cases Porsche would not budge. Seems stupid but I guess they have already taken the accounting hit on their financials so they don't care.