Turning in my car

[timetosave]

Well, I'm not turning it in so-to-speak, I'm trading it in. I want a smaller car payment (I'm doing well now and this is the only thing keeping me from saving more).

It is a smart buy or a lease. If I trade it in can I expect to have to pay out the remainder of the lease?

I have 24 months left on it.
It only has 36,000 miles on it
I want to trade it in for a car the same size but used...

thanks
timetosave

[moneybags]

You might want to consider selling your car on your own. I always sell my cars as oppose to trading them in. We get more money that way. Last time, I sold my old van on craigslist.

[Coleroo]

I can't quite tell what you're asking...


Are you saying you have a current car right now on lease? (Leases are terrible, terrible things in almost all situations!). What are the details of your lease and the early turn in details?

[autoxer]

Well, I'm not turning it in so-to-speak, I'm trading it in. I want a smaller car payment (I'm doing well now and this is the only thing keeping me from saving more).

It is a smart buy or a lease. If I trade it in can I expect to have to pay out the remainder of the lease?

I have 24 months left on it.
It only has 36,000 miles on it
I want to trade it in for a car the same size but used...

thanks
timetosave

I'm assuming it is a GM vehicle financed through GMAC, because they trademarked smartbuy.

http://www.gmacfs.com/us/en/personal/automotive/leasing/plan.html

Have you reviewed your contract? According to the above website, if you turn in the vehicle at the end of a smartbuy contract, you will have to pay a disposal fee, excess mileage charges & excess wear charges. They don't say anything about turning it in before the end of the contract. How long have you had it & what is your mileage allowance?

[poundwise]

A leased vehicle has a pay-off figure, or a "residual" amount that has to be paid to gain ownership. If you "trade-in" a leased vehicle this amount will be rolled into the new lease or new loan. More info

This is a terrible arrangement and you will be much better off if you don't do this.

Your other options are to continue paying the lease or to pay off the vehicle and then, once you own it, sell it to another party.

A third option involves arranging the sale of the vehicle even without you actually owning it. It is complicated but I've seen it done. You find a buyer, you pay the difference between what the buyer will pay you for the car and what the pay-off is, and you do a three-way transaction. The money you and the third party bring to the table pays the vehicle off and then you receive the title and sign it over to the third party.

Just so all that doesn't make my initial comment unclear, the bottom-line for me is that "trading-in" a leased vehicle is a terrible idea and, in virtually every conceivable scenario, just makes a bad arrangement worse.

[cschin4]

Why do you want to trade in a car with only 36,000 miles on it? Buying too many cars over one's lifetime is a quick way to financial ruin. Instead, keep the car. Splurge on having it "detailed" so you can get the new car smell back for a few days.

[poundwise]

Since you stated that your goal was to have a smaller car payment, another option would be to obtain a loan in order to buy the car from the leasor. Then you will owe someone else for the car but it will no longer be subject to lease terms. You will be making payment on a loan for purchase.

Depending on the rate and number of months your obtain the loan for, your payment could be smaller, particularly if you put some money down yourself at the time of the loan.

[timetosave]

Thanks everybody...this is why I came here first.

It is a Smartbuy (I had no idea at the time how stupid this purchase was) I'm learning.

I am paying 489.91 monthly for this car. I have 36,000 miles on it and I have a mileage allowance of 60,000. I would really like a used car that will allow me to reduce that payment amount. I have other bills/debts that this money can be used for.

Ok, trading in the car is a no-no...good to know.

I have 24 months left on the lease at that time I have the option to pay the car off (which I will not do because it will not be worth it to me) or paying 265.00 to get out of the lease...I choose the latter. So I'm stuck with the car for the next two years...I will look into the loan...though with my credit I'm not likely to get one...

Thanks everybody.

I hope all is well.

timetosave