How to unlock the equity in my leased vehicle?
I have leased for the previous 3 years an SUV from Kia. The lease terms claimed a 36,000 mileage but I have only put 19,000 miles on the vehicle. Everyone is telling me that I should be able to "get equity back on the vehicle at return" but when I told the dealer that I would be returning the vehicle and wanted to discuss what equity value was left, they said that by virtue of returning the car I forfeit my equity in the vehicle.
Since it isn't in their best interests to explain to me how I'd go about getting this equity resolved, I'm hoping that other people who've been in this situation before can let me know how best to proceed. I currently don't need the second vehicle, so converting the equity in a second car is not really attractive. The dealer salesman mentioned I could sell both the leased car and our current car and put equity of both items into a third new car, but not sure if that is advantageous or not.
My question is how to unlock the equity of the vehicle -- preferably by getting a big check from someone, but if the only way to do that is by shuffling vehicles around, I'd love to hear input on that.
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We have a Honda Accord, 2014, and the 3 yr. lease is nearly up. Our equity will be the difference between the Current Market Value
and the residual value. That difference (equity) can be applied to any repairs, charges, etc. or applied to a new lease or purchase.
I just returned a leased 2013 jeep unlimited...I was allowed 15,000 miles a year for 36 months. My buyout was ,000. The jeep was worth ,000...I had 34,000 miles on the jeep. I did buy the jeep and turned around and sold it back to them for ,000 more than I paid for it. This I used for a down payment on a new Jeep lease.
The response above saying "you have no equity" is incorrect. I have actually used the equity in a leased vehicle, but the catch is, you must lease or purchase another vehicle from the same manufacturer (this may actually apply to the dealership, not just the mfr; in my transaction, I stayed with the same mfr.). The reason is, they know they can get more for the vehicle than what they originally estimated when you initiated the lease. The dealer would never disclose this, of course. It's extra money for them.
Here's what I did: I had a Jeep Patriot that was well under the mileage calculation on my lease. I called Chrysler Corp customer service. Based on the vehicle's age and mileage, they told me I have 00.00 in equity. Convenient, as we had some body damage that was estimated at 00.00. When I brought the vehicle in, I mentioned the equity and the cost of the damage and the dealer said, "Yep, you can walk away from the Jeep without any out of pocket for the damage."
Technically, I left 0.00 on the table, not to mention, my quote was from a 3rd party repair company (retail) and the dealership could make the repairs at wholesale cost. But I was just happy to not have to pay for the repair. Lease equity is real.
Since you are leasing the vehicle, you have no equity in it. To get that equity, you would first have to own, which you probably have the option to do if your lease contract has a buyout clause. So buy the vehicle at lease termination, and (theoretically) get a better price selling it, if the low mileage you put on it really does have market value.
From my own limited experience, chances are the buyout clause will stipulate too high a price to make the whole exercise worthwhile (basically, a projected "retail" value of the vehicle at the end of x lease years). You of course would have to be comfortable that you could readily sell for better, and you would take some brief ownership risk. But if the car is pristine, who knows; may well be worth it.
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