Leveling a Leased Truck....

Knightfall · October 13, 2016

Is this a bad idea? If it helps, the lease is already paid off (It was a one-pay lease).

Waaazooo · October 13, 2016

As long as you don't just turn in the keys it's fine.

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Bayou-AllTerrain · October 13, 2016

I just plan on taking mine off when I turn it in.

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Silvern Sentry · October 13, 2016

And here I thought that I was the only one who paid his entire lease up front. Cheers brother!

It works 2 way depending on your lease terms.

On a closed ended lease with a mileage rating the residual value is set in stone. ex) If the residual is 20k but the car is only worth say 15k you just hand the keys back and walk away. In this case you would remove the lift and return it as it was handed to you. Just like painting a rental unit you must paint it back to original color at end. Most leases are closed ended.

On an Open ended lease you have no mileage and the residual value is NOT set in stone. ex) if the residual is 20k but the car is only worth 15k then you owe 5k before you can walk away. The obligation is higher since it is calculated with no mileage but the obligation + residual is still exactly the same as a closed ended obligation + residual. Over all you pay exactly the same. On a open ended lease you can basically do whatever you want to it because you are responsible for any devaluation. Just do not do something that will devalue and you should be golden. My lease is open ended. Open ended leases are not better and would not recommend for everyone but for trucks specifically they are nice since North America loves its trucks and they hold thier value better than any other vehicle. You do not see a used truck with low mileage sit a lot long at all.

Waaazooo · October 13, 2016

And here I thought that I was the only one who paid his entire lease up front. Cheers brother!

It works 2 way depending on your lease terms.

On a closed ended lease with a mileage rating the residual value is set in stone. ex) If the residual is 20k but the car is only worth say 15k you just hand the keys back and walk away. In this case you would remove the lift and return it as it was handed to you. Just like painting a rental unit you must paint it back to original color at end. Most leases are closed ended.

On an Open ended lease you have no mileage and the residual value is NOT set in stone. ex) if the residual is 20k but the car is only worth 15k then you owe 5k before you can walk away. The obligation is higher since it is calculated with no mileage but the obligation + residual is still exactly the same as a closed ended obligation + residual. Over all you pay exactly the same. On a open ended lease you can basically do whatever you want to it because you are responsible for any devaluation. Just do not do something that will devalue and you should be golden. Open ended leases are not better and would not recommend for everyone but for trucks specifically they are nice since North America loves its trucks and they hold thier value better than any other vehicle. You do not see a used truck with low mileage sit a lot long at all.

This is true but even a closed end lease allows you to trade or buy the truck in lieu of just turning the truck in. Many plus sides to not just turning in your keys.

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Silvern Sentry · October 14, 2016

This is true but even a closed end lease allows you to trade or buy the truck in lieu of just turning the truck in. Many plus sides to not just turning in your keys.

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Yes both give you the option to buy it out. Even if you 'turn it in' you are effectively buying it out and selling it at the same time anyway since you will still pay the taxes on the residual value. Uncle Sam always gets his cut. Chances are nil that the appraised value will be exactly what the residual is so there is always some +/- at the end of a lease to figure out.

The plus side is I get to buy a used truck that I know was babied in immaculate condition with super low mileage for 21.5k CAD which is basically a unicorn and you will not find one like it that sits on any used for more than 5 mins. The downside was I paid 17k just for the plivledge of driving for 2 years and having the opportunity or first crack to buy it.

Bayou-AllTerrain · October 14, 2016

This is true but even a closed end lease allows you to trade or buy the truck in lieu of just turning the truck in. Many plus sides to not just turning in your keys.

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That's correct. I'll look at mine 3 different ways when my lease is up.

1. Buy it out. (Probably won't since I like a new vehicle)

2. Sell it out right. (Pretty easy to do where I work)

3. Turn or trade it in.

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diyer2 · October 14, 2016

Never understood the desire to lease and give money away.

Bayou-AllTerrain · October 14, 2016

Never understood the desire to lease and give money away.

No different the buying and trading it in a few years. If you get a new vehicle every 2-3 years it usually a better option then buying. If you are the type that pays a vehicle off then no it's not usually a good idea.

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Knightfall · October 14, 2016

After my 2015 Colorado was totaled, I received about $20k when everything was said and done with the insurance company. Knowing I wouldn't be able to get another Colorado anywhere close to how I would like it simply because of the demand and low supply, and at a deal like i had, I decided to look at full size trucks, knowing I would appreciate the extra cargo space when starting my career off and not needing a fancy trim level, 4x4, or a V8 since I live in the South or tow/haul anything heavy. Financially, I did the one-pay lease because it made sense for me at the time: I didn't want a payment but could not outright buy the truck for $20k. So now I have my Silverado. I don't regret the decision and I've had my Silverado since April.

Silvern Sentry · October 14, 2016

Never understood the desire to lease and give money away.

If you do the math a lease will cost you exactly the same as financing to the penny exact. Your out the door price is exactly the same, to the penny exactly. On a lease you obligation+residual = that price or what you would have financed exactly.

In fact financing can be a much worse choice if you are on a long term. The reason is because for the first half of the finance you are entirely upside down on the financing and you owe more than the car is worth. With a lease it is nearly impossible to ever be upside down (well you can go way over mileage but still not the same).

The best way and the only way you will save money buying a car is to pay cash. If you think financing is better than leasing or you somehow get a better price or pay less in the end you are dead wrong. Think of it as Rent-To-Own if that helps. If you are smart like me and pay an entire lease upfront and then make the dealership buy the vehicle at cash price and do an in house lease you save even more. $0 interest and got over 10k off MRSP (on a GM lease or finance I would have only got around 7500 off MSRP because some credits only apply to cash purchase as stated by GM).

T1Kaiju · October 14, 2016

Leases have a finance charge too called money factor. They couldnt get a lease cheaper than my payment on a 72mo 1.9% loan because TX has a tax on full vehicle up front.

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