Trading in a Leased Vehicle

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May 26th, 2020 5:52 pm

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May 26th, 2020 4:22 pm

reitag [OP]: Newbie; Jan 13, 2015; 47 posts; 28 upvotes; East York, ON

May 26th, 2020 4:22 pm

Trading in a Leased Vehicle

I feel like this might be a stupid question, but I've done some poking around online and couldn't find a straight answer.

I have a GM vehicle with 20 months of term remaining at $316 per month or $6,320 (HST in). Purchase option is $8,211 + HST. Total of lease payments + buyout is ~$15,600.

I'm looking to get into a used car of a different brand with better safety features.

I was thinking of calling GM and having them charge me the full $15,600 to own the car outright so I could then go and trade the vehicle in towards what I'm looking for.

I had reached out to a dealership who said I'd be fine to trade in the lease.

Could I simply trade in the leased vehicle towards the new vehicle that I want? I assume if they deem it is worth say $13,000 I'd have to make up the $2,600 balance they would need to pay out to the financing company.

Also, if a trade in of a lease is possible, are there any potential liability issues with my name being on the financing agreement?

Or, would it be much easier for me to first just buy out the lease now for $15,600 and trade it in as normal.

2 replies

May 26th, 2020 4:30 pm

Xtrema: Deal Fanatic; Sep 1, 2004; 8296 posts; 7197 upvotes

May 26th, 2020 4:30 pm

Basically the dealer will assume your lease and buy it out for you. And give you a trade-in amount (after all the costs involved to takeover the lease) towards the used car.

The only issue I see is this is a high wire act and there is a lot of opportunity for you to get screwed by a used car dealer. Know you numbers and tread carefully and understand everything that the used car dealer proposes.

It's time like this that I really love AB where nobody need to do all the trade-in BS just to skip H/PSTs.

May 26th, 2020 5:52 pm

mikeymike1: Deal Fanatic; Apr 16, 2007; 8125 posts; 3457 upvotes; Financial District B…

May 26th, 2020 5:52 pm

reitag wrote: ↑ I feel like this might be a stupid question, but I've done some poking around online and couldn't find a straight answer.

I have a GM vehicle with 20 months of term remaining at $316 per month or $6,320 (HST in). Purchase option is $8,211 + HST. Total of lease payments + buyout is ~$15,600.

I'm looking to get into a used car of a different brand with better safety features.

I was thinking of calling GM and having them charge me the full $15,600 to own the car outright so I could then go and trade the vehicle in towards what I'm looking for.

I had reached out to a dealership who said I'd be fine to trade in the lease.

Could I simply trade in the leased vehicle towards the new vehicle that I want? I assume if they deem it is worth say $13,000 I'd have to make up the $2,600 balance they would need to pay out to the financing company.

Also, if a trade in of a lease is possible, are there any potential liability issues with my name being on the financing agreement?

Or, would it be much easier for me to first just buy out the lease now for $15,600 and trade it in as normal.

Becareful there. Dealers are no authority to give you any advice in regards to your auto lease agreement.
Only the lessor can tell you it's alright to use 'their property' as trade in value and with that said most won't allow it. First, it's not your property to trade. Second, you would be in default of the lease agreement as trading it would automatically release you from that 48 month lease agreement you signed (predicated you signed a 4 year lease)

----------------------------Licensed Credit Bureau member, S1, FI Automotive, CCP forums most banned = x 13 and counting, guess who that is?... stomped to the curb once again

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