Lease Ending Soon? Read This Now
The pandemic and economic shutdown has resulted in so many unpredictable outcomes, one being that used car prices have shot up to record levels. Many used cars are now worth much more than they were before the pandemic began. Demand is so high for some models, dealers are paying closer to retail price rather than wholesale price at dealer auctions.
Whenever market conditions become whacky like this, I try to highlight opportunities where you might be able to take advantage of the situation. In this case, there's an opportunity to profit for those who are currently in a lease that's close to ending.
Normally, at the end of a lease, you turn the vehicle in and pay a small disposition fee. However, you also have the choice of purchasing the vehicle at the buyout price stipulated in your lease agreement. This buyout price is determined at the beginning of your lease, based on historical depreciation rates. It is very likely that the predicted values are off by a lot, which could mean that the buyout price for your vehicle is way lower than what the vehicle is worth in the marketplace.
This means there could be an opportunity to buyout your vehicle and immedietely turn around and sell it at a profit. I've seen instances where people have made upwards of $3,000 using this strategy.
This only works in States that allow you to purchase and sell a vehicle without incurring taxes if done within a specific period of time - usually 10 days or less.
If you're currently in this situation and would like to learn more, I have an article titled How to Profit From an End of Lease Buyout that goes into more detail.
3 Steps Every Car Buyer Needs to Take to Save Maximum MoneyThe key to getting the best deal is to gather price or lease bids from as many local dealers as possible. Then shop that best price around until no one can beat it. Here are the steps:
Step 1 Get Prices From My Trusted NetworkSelect the vehicle you're interested in to see if there are local dealers in my network who will provide you with their best upfront price. You will get direct access to an internet sales manager who you can further negotiate with online (no need to visit dealership).
Step 2 Get Prices From TrueCar / CarsDirectTrueCar, and CarsDirect are my top 2 online price quote recommendations. These services show you pre-negotiated prices from dealers closest to you - and the deals are usually pretty decent. But remember, you can still negotiate further.
Step 3 Complete my ChecklistFollow this up with my checklist to make sure you squeeze out every last bit of savings.
- Gregg Fidan
Each week, I'll keep you up-to-date on the latest car deals and news that might affect your purchase. This includes...
- Best Rebates, Incentives, and Lease Deals
- Latest Car Buying Scams and Tricks
- The Best & Worst Time to Buy a Car
- Which Cars You Should Avoid