Advice on 40th Anniversary Lease Takeover Please!

brettmag

Hi guys,

I live in Canada and am looking at taking over a 40th Anniversary with 16,000km.

The current owner put almost $9,000 as a down payment and wants the person taking over the lease to pay them $2,500. I'm sure there's some room to negotiate there. The monthly payments are $675 including tax with 23 months remaining. The residual buyout is $18,900 in May, 2014.

My debate is to get a 370z, this one or another one or buy a brand new 2012 VW GTI. Partly because I would have to purchase winter tires for the 370z because our winters are brutal.

Is this a good deal? What should I do? If you think I should make an offer, what do you think I should offer for a down payment?

Thanks!

andre12031948

If I'm missing something. I'll apologize.

When I add your payments plus the 2,500k, plus the residual buyout, you would have paid $34,900 for a USED 370z.

Not sure how many year lease the 1st. owner took out but if it was a 3 year lease than this Z will cost him $55,000 to own.

If I'm not missing something, then I would like to move to your area because I'll be able to become a millionaire in a short amount of time

brettmag

Haha ya, cars are more expensive in Canada.

It was 48 months lease originally... so it would actually cost more than $55,000 after it's bought out (if it's bought out).

Crazy hey?! If I take over the lease you are correct with $34k for cost of ownership. The original owner has spent $25k on it so far including down payment.

brettmag

Some people purchase used 370z in the states and import them to Canada, but after the hassle, transportation, duty and taxes, it's almost equal.

There used to be a large price disconnect where people could make $5-10k by importing a vehicle. Escalades were profitable.

MattP725

You can do better privately I would assume. On top of that you will have to go through the hassle of transferring everything over and possibly paying redocumenting fees then finding a lender and negotiating rates in 2 years (when it is more likely rates would be higher than now than lower).

Also between now and then you would have no chance for equity in the car and would be charged penalties to get out of it. Even if you bought one and sold it in a year, you would not be as likely to be upside down.

Not a stellar deal, even without the 2,500, by any means.

Never pay someone to do them the favor of taking over a leased car they no longer want. 90% of the time it costs them substantially to break the lease... he is entitled to nothing.

brettmag

The reason they want $2,500 is to recoup a portion of their lost down payment. I agree though, I wouldn't pay that and would want them to pay the transfer costs.

I highly doubt I could do better privately on a 40th anniversary edition. My guess is it would sell for $38k used privately. It's appealing to do this deal because of no initial down payment (if negotiated well), the payments are reasonable and I would be able to buy the car in cash in two years. It's either downpayment now with payments for X # of years OR payments now with buyout later. You are correct with rates probably being higher in 2 years though!

Thanks for the input!

11Thumper

I totally agree. He had his fun and the benefit of a new car. For whatever reason he needs to unload the financial burden but I don't see how he's entitled to cash payment. It would be good for you to determine the cost to him of breaking the lease prior to negotiating.

brettmag

Actually her name is Pam! So it's not a guy who abused it for 2 years now wants out. Not saying that Pam didn't drive it hard... but, you know...

I would not pay the lease transfer costs. This is their penalty to get out of the lease. I would be doing them a favour and should not have costs like that. I found on the internet that it costs $450 to transfer. Could be wrong though.

andre12031948

Forgot to add taxes that you'll BOTH pay on the $18,900 buyback PLUS the interest to finance. Together should add up to $5,000 for each of you.

So now it's a $40,000 used car for you.
AND
$60,000 for her????

and whatever other fee's (transfer?)that have to be added.....

brettmag

Yes, 10% tax on $18,900 buyout. I would pay cash for that so no interest costs.

Pay a premium for 40th z's because they are very rare in Canada. There's only one used 370z in my province and it's a 2010 touring with sport with 17,000 km private sale (no taxes) listed for $36,000, probably could get it for $34,000. This one comes with winter tires, which is nice and saves around $1200.

andre12031948

So it's Pam

How much are you smitten by her?
How badly does she wants out of the lease.
Sometimes a deal can be worked out

brettmag

I emailed to find out. We'll see how much she's willing to move in negotiation. What would you suggest I offer to make it a good deal?

andre12031948

So cars & taxes are much higher in Canada. At least since Canada is Full of oil & vast energy sources, with a much smaller population, gasoline must cost much, much less than in the U.S.
Oh, gas also costs more.
Well, at least health care is free. Or is it?

andre12031948

Depends how good looking she is and how often she sees you.

brettmag

Haha. The car is in Toronto, I'm in Western Canada. So I would have to get the car shipped or else fly there and drive back. There's another $1000... ****. This isn't sounding good!

Yes health car is free (included in taxes), economy is doing very well, unemployment <5%, etc.