4 ms·

if you bought a car new in 2019 (as I did), and it is the kind of car rental companies might rent (which mine is), you get letters from the dealer in 2021 offer

if you bought a car new in 2019 (as I did), and it is the kind of car rental companies might rent (which mine is), you get letters from the dealer in 2021 offering to buy it back from you for more than you paid for it! I'm in this situation and it's getting strange if your car is leased. Carvana and the like were offering me thousands more than the buyout amount. Like $5,000 at one point. But now the automakers and their banks are shutting off 3rd party purchases, meaning the only parties that can buy the car off the lease are you and the dealer. And the dealer has no car on-hand to replace the one you plan to sell back, or if they do they want thousands over MSRP because that's what the market is bearing. So it's a wash.

jayess 5y ago
Interesting. I just sold my off-lease car to Carmax for $6k more than the buyout. When I was at Carmax, they had me call BMW financial services on speakerphone because they wouldn't give carmax the final payoff/lienholder information. That must have been what was happening.
- joezydeco 5y ago
  There are a lot of interesting anecdotes on /r/askcarsales about this. One consensus is that Carvana/Vroom/Shift are buying cars at a loss to try and capture market share. Carmax has more of a track record so they might be getting a better shake like your experience. It could also be you calling personally that unlocked the lien, where the other companies don't work that way. Some manufacturers like Volvo aren't letting you out of the lease early unless you're leasing another Volvo.
  - bityard 5y ago
    > One consensus is that Carvana/Vroom/Shift are buying cars at a loss to try and capture market share. They absolutely are. Where I live, these companies are (and have been before COVID) paying well above market rates for newer used cars from private sellers. On the flip side, all of your typical auto sales rags and sites that used to have listings from private sellers and used car dealerships are now mainly carvana listings.
    - llampx 5y ago
      Sounds like anecdotes about Zillow where they're working hard to buy up all the inventory they can.
bonestamp2 5y ago
Even if you don't want to buy out your lease, buy it out anyway and then sell the car to your dealer (or another dealer). Check the numbers first of course, but you'll likely pocket several thousand dollars.
- joezydeco 5y ago
  In certain states you will owe the sales tax on the entire residual amount. This tax is skipped when you let the dealer assume the buyout. But in the past 6-12 months some banks are adding massive amounts to the buyout price when the owner isn't the one making the purchase. When you read the fine print, the residual value only applies to the owner. The bank can charge whatever it wants to everyone else, or deny the purchase altogether.

jayess 5y ago

Interesting. I just sold my off-lease car to Carmax for $6k more than the buyout. When I was at Carmax, they had me call BMW financial services on speakerphone because they wouldn't give carmax the final payoff/lienholder information. That must have been what was happening.

joezydeco 5y ago
There are a lot of interesting anecdotes on /r/askcarsales about this. One consensus is that Carvana/Vroom/Shift are buying cars at a loss to try and capture market share. Carmax has more of a track record so they might be getting a better shake like your experience. It could also be you calling personally that unlocked the lien, where the other companies don't work that way. Some manufacturers like Volvo aren't letting you out of the lease early unless you're leasing another Volvo.
- bityard 5y ago
  > One consensus is that Carvana/Vroom/Shift are buying cars at a loss to try and capture market share. They absolutely are. Where I live, these companies are (and have been before COVID) paying well above market rates for newer used cars from private sellers. On the flip side, all of your typical auto sales rags and sites that used to have listings from private sellers and used car dealerships are now mainly carvana listings.
  - llampx 5y ago
    Sounds like anecdotes about Zillow where they're working hard to buy up all the inventory they can.

bonestamp2 5y ago

Even if you don't want to buy out your lease, buy it out anyway and then sell the car to your dealer (or another dealer). Check the numbers first of course, but you'll likely pocket several thousand dollars.

joezydeco 5y ago
In certain states you will owe the sales tax on the entire residual amount. This tax is skipped when you let the dealer assume the buyout. But in the past 6-12 months some banks are adding massive amounts to the buyout price when the owner isn't the one making the purchase. When you read the fine print, the residual value only applies to the owner. The bank can charge whatever it wants to everyone else, or deny the purchase altogether.