|Sep 14, 2004, 06:08 AM|
USA, NY, Jamestown
Joined Jun 2000
Advice? Buying a leased car from someone.
I am thinking about purchasing a car from someone who is leasing it. It has about 8 months left on the lease. I intend to pay cash for it. I don't know the guy as I responded to an ad in the paper.
The seller has proposed that I give him a certified check for our agreed price and he will give me the car and a purchase agreement letter. He (we- as I will make sure it goes in the mail) will send the check overnight delivery to the finance company - Honda. Honda will send him the title and he will sign over the title to me. It will take about 4-5 days for the transaction to be completed.
I am uneasy about paying off his transaction and not having my name on the title from Honda. But they won't release the title to any one but the person whose name is on the lease.
Has anyone else tried a transaction like this?
Any advice on how to make this work in a more straight forward manner?
Someone suggested to make out a prommissory note to the person that specifies that the loan needs to be paid back in 2 weeks or interest will start. The loan would be paid off with the title to the car. And to have this note notarized.
Of course the easiest would be to have him pay off the lease and get the title and then we have our transaction. But I am not sure he has the cash to do this.
|Sep 14, 2004, 08:16 AM|
Have you read his lease contract?
The one lease I had only had clauses for terminating the lease early with penalty. When the lease was complete the car was still owned and returned to the leasee, in my case GM. Once the lease was completed THEN I had the option to buy the car for even more money.
If this guy really wants to sell the car to you, then you both need to be talking to a representative of the lease company. And I'd expect to see the lease company issue some papers (a contract) that specifies you are paying X amount of money to both A payoff the lease and B purchase the car. That deal is between you and the lease company. Your seller should have nothing to say about it except thank you for getting him out of the lease. If he dosen't let you talk to the lease agent (company) RUN AWAY you could loose the money and the car.
|Sep 14, 2004, 05:22 PM|
JoeR - I am the Internet Manager for a large Honda dealer.
1. There is no early termination fee for expiring the lease early, however, there is a 500.00 fee for purchasing the car at the end of the lease. This will have to be paid.
2. At the end of the lease, there will be a 'residual value'. This is what the buyout is at the end of the lease. This will have to be paid in addition to the 500.00, plus all remaining payments.
3. You are correct in stating that once the lease is paid in full, the title will goto the leasee, not you. This does not, however, take about 5 days, it takes 6-8 weeks.
I would not recommend this purchase, Honda's are very common, and I am sure that another deal would be found in the autotrader or at a local dealer that will be better.
|Sep 14, 2004, 08:35 PM|
To add to the good points of Nitroaddict;
When a car is nearing the end of it's lease term, often the leasing company will offer very good prices & loan terms to the lease holder. When my Durango was nearing the lease term end (90 days) last year, They offered me the option of purchasing the truck at Blue book value. At 60 days, they offered it to me for $1000.00 below BB. The day I turned it in, they offered it to me for $2000.00 below BB.
The guy you are thinking of buying from is being given a payoff amount that does not reflect the leasing company's desire to not be in the used car business.
|Sep 25, 2004, 04:38 PM|
Nashville, Tennesse, United States
Joined Mar 2004
You can't buy a leased car, it does NOT belong to the man selling it, that's why it is leased. I think you would be making a mistake.
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