dwynne

My 8 is getting near the end of the cheapie 2 year lease. Checking around online I could buy a low mile GT 6mt (with or without NAV) like mine for less than the residual in some cases - more in others. For the right price, I would not mind keeping mine - and to me the right price would be less than the residual.

With other leases I have had good luck and some bad luck trying to negotiate a more favorable end of lease buyout price. Anyone done this with MAC? Any luck?

Another thought is to work a deal with the dealer to turn it in and buy it back as a CPO. But again, at a better price.

Thanks,
Dennis

Hyperborea

Dennis,

I too am nearing the end of the 2 year lease and am also thinking about buying mine out (actually was part of the original plan - I got a $2K rebate for leasing and a very low interest rate so leasing and then buying will be cheaper than buying up front). How is your buyout negotation going? Have you been able to get the price knocked down? Who did you talk to about this? MAC? Your original dealer?

Thanks

dwynne

No movement on this so far, and I am down to just 2 payments to go now.

I think the idea is to act like it is a new idea if they offer to sell you the car. If you call them up and say you want to buy the car, then any leverage you have to get a lower price goes out the window. In the past, lease banks have offered me a low interest loan or something similar to entice me to keep the car rather than turn it it. So far nothing at all from MAC, just letters reminding me the lease end is near and no where mentioning anything about me buying the car at lease end.

I don't think the salesman is still at the dealer where I leased the car (big shock there) but I am thinking of calling the dealerships GM or maybe used car manager and asking them about this type of thing. See if they are willing to share any insight into if a deal can be made or not.

I would like to try to get a deal done before they inspect my car, once they find out how few miles are on it (less than half of the allowed lease miles) they may not want to discount the car to me at all

Dennis

SC-ed

My lease is up in june also. Lease then buy was better than buy 2 years ago. Mine is sport 6mt and I'm buying no matter what. It has 16k miles and the buy off price is $17k. Don't have a single problem with the car. I know it very well, it has some mods and I'm buying it for sure. Don't want another one even for cheap. It'll be good if I can make a better deal with MAC. But don't have a strategy for that yet. Still waiting. I think I'll find a good credit, go talk to dealer and play stupid, see what they gonna offer. Then think about it again.

dwynne

Did you buy from a local dealer (I did not), if so why not stop in and talk to them? My guess is you would want to ask for the used car manager. Tell him you have a leased Mazda and had some questions about buying at the end of the lease - and if there was any wisdom in turning it in to him first.

Some captive lease companies, like BMW, will offer the car to the turn in dealer - the price known only after you have turned in the car. The dealer usually will have done some turn in lately and can give an idea about what that price will be - then you could compare it against the residual/buy out price. Often, it is a good bit less (BMW does not want to have to auction the car, since that is truly low money) but you have to allow for the dealer to make a profit from handling the deal, so your net savings may not be a lot. The main reason to do it is to buy it back CPO for the long warranty, as BMW has no factory backed extended warranty otherwise.

Other companies, like Honda I am told, will listen to an offer from the turn in dealer for the car after they get it. If they say yes, the dealer buys the car. If they say no, then the car goes to auction (could be public, could be Honda only).

Most 3rd party lease banks now buy "residual insurance" for leases - if your turn in car fails to get residual value for the lease bank (from you, a dealer, the auction, whatever) then the insurance pays the difference to the lease bank. This is good for them, but real bad for you since they have absolutely 0 interest in discounting the car to you. Say auction on your car is $15k and the buyout is $17k, logic would say they should let you buy it from something over $15k to maximize their money. With the insurance, they say take it at $17k or leave it. Then if it only brings $14k the day of the auction, they are still covered. A lof of 3rd party banks now use a company to handle all the end of lease stuff, they are even more hard line that the banks about no deals - period.

Getting a good deal on a lease buy out used to be a hidden benefit of leasing, you often could get a good lease deal based on a too high residual then at lease end the bank knows they can't get that for the car, so will offer it to you at a discount. So you save on the front end and the back end. That seems to a loophole that is closing up

I am still trying to figure out how Mazda/MAC work it - if I could buy a car just like my 6mn GT w/NAV for the buy out or less from ads on cars.com or autotrader.com, then I see know way they will realize that much on it WHOLESALE if I turn it in.

Dennis

Rootski

iTrader: (1)

Buying a car off lease always seemed to me to be paying way too much for a used car.

dwynne

Typed like someone who has no idea what they are talking about.

Have you ever leased? Every deal is different. The residual/buy-out price is a GUESS at what the car will be worth 2 or 3 years down the road. On some deals they guess too low and the car is worth more on the open market than the buy out, this makes it a great deal to buy off the end of the lease. Some times they guess too high, and it is not a good deal - and the end of the lease the smart banks will see this and accept less to not have to "eat" the car.

So buying at the end of the lease can be a good deal, a super deal, or a bad deal - it all just depends.

I have done many leases and I have NEVER yet turned in a car. I always found someone to buy it from me off lease either for my cost (to get out of the lease early) or at a profit. So not only did I get a "good deal" on the car, I MADE MONEY at the end of the lease by selling the car. The amounts can vary, but I have made as much as $2k or more getting rid of a lease car.

Dennis

SC-ed

Dennis, sounds like you have some experience.
The dealer I leased the car from is out of state also. I have to deal with a local dealer now. Is that bad or good?
I don't want them to see the car. It want be good for me.
I've been told to call MAC and try to talk to someone with authority to deal. Is that right?

BTW a quick autotrader.com search give me no rx8 under 18k in 300 mi radius from me. I guess my buyout price is not that bad after all. But always can be better. I hope.

dwynne

I talked to the owner at the dealership where I leased the car (about a 3 hour drive one way) and he said:

"Mazda does not discount the lease residuals. Actually, used RX-8s have sold well. Feel free to contact Mac directly."

In other words, no turn in to him and buy back for a lower price. Of course, he may want me to turn in then he DOES buy it at a discount price and sells it used or CPO for a larger profit.

I can't think they want these cars to go to auction, since the numbers are pretty bad:

Auction Values

Sale Prices for Week Ending April 19, 2007

2005 Mazda RX-8

Above Average: $18,264 - Mileage: 10,339
Average: $16,413 - Mileage: 20,678
Below Average: $14,562 - Mileage: 31,017

Total Sold: 62

Keep in mind vehicles sold at auction have incurred expenses for reconditioning, transportation, and auction run/sell fees.

These expenses need to be taken into consideration when placing a value on a vehicle you are looking to buy/sell.

But MAC may have residual value insurance, if they do then they will not care and will not offer us a discounted buy out.

I looked at cars.com this morning and found a few RX-8 GTs with less than 10k miles on them going for well under $20k (I think one was around $18k).

AFAIK, we have to turn the car back in to the leasing dealer and not just any Mazda dealer - but that is something we need to clarify.

Another thought is to find out how much CPO costs to buy (for the dealer), then try for a turn in, and buy back as a CPO car. I don't know if that is worth a lot, since the 04-05 cars have had the powertrain extended to 60k miles/5 years (CPO goes to 8yrs/100k).

Let me know if you find someone at MAC to talk with

Dennis

maxxdamigz

iTrader: (1)

When I went to a car dealer with a friend looking at leases, the deals were horrible. He was looking at a cheaper bracket of cars at the time for commuting and the lease to buyout option was a couple grand more than straight buy. The dealer actually was advocating a "smart buy" where you buy the car for X payments at you have the option to sell the car back to the dealer at the Y month mark. It was clever because if you were to total the car, the loss would be yours and not the lease holding company. I personally never considered a lease as I like to tinker too much and generally put too many miles on cars.

SC-ed

I called MAC today for my lease end options. Asked what is my buyout price and how we gonna do it since the dealer is out of state. The CS guy told me to go to the nearest dealer. I told him I wanna discuss my buyout option with someone with decision making authority. The guy keeps insist about talking with dealer. I told him that's not what I meant and that they hold the title and I want to speak with them. Finally reached a guy named T.J. Told him I want to discuss the price. He said we don't negotiate buyout prices. I told him for my research on the rx8 used cars market, the low resale value etc. And he says turn in the car and get another one then. I said I really hope you make my decision easy and keep the car I know.
But he doesn't buy it - we don't negotiate, that's it.
So no luck. Thinking to try them one more time a week before lease ends. But not holding my breath.

dwynne

It is good to know you can turn it in closer to home. Online and the stuff in the mail makes me think I have to drive mine 3 hours back to where I got it.

I was going to call them and ask about turning it in to a closer place as well.

Sounds like they either are using a 3rd party for lease turn ins (US Bank and others do this) or they have residual insurance. In either case they will not haggle on the price, I don't think.

One other thing to ask about is a discounted loan for the buyout. While USBank and their 3rd party "remarketing" company would not discount the car (until the very last day) they DID offer, through the bank, a loan to buy out the car that was a little below market rate.

If you check CapitalOne online they show 8.25% 8.75% 9.35% for lease buy out (ouch) but 6.65% 6.95% 7.59% for a used car purchase via a dealer. On a $20k loan this is over $800 in extra interest. If all else fails, I have a dealer I can use that can buy my car for the buy out price and sell it back to me as a licensed dealer for the same price - so I get the better rate. They normally charge $300 to handle a sale for me (I have sold two on lease cars through them in the past) but I think they will do this one for less - it is a lot simpler and I get the repeat customer discount :D . They may can do an even better rate too.

I looked into a MEPP (Mazda extened warranty) and the best price I have for the full coverage (as much as it gets, but not bumper to bumper) is about $1,800 for 7 yrs, 60k miles. I think I will pass. I can cover a Honda, just about any model, for far less with Honda Care. My powertrain warranty has been extended to 5yr 60k, so the MEPP price is just too much.

Have you been contacted or did you ask about a pre turn in inspection? I have less then 2 months to go now and while it is mentioned in some stuff they have sent me, no one has contacted me about looking at the car.

Dennis

SC-ed

I've been contacted from a third party company to schedule an inspection. I just told them I have to talk to MAC about my lease end options. They gave me the reference number and a phone to call later, but I will not. I'm buying the car. Even NADA trade-in price is higher than my buyout price.
I didn't ask MAC for discount credit, b/c I can get a rate under 6%. I doubt they can offer anything better.

dwynne

I called them and talked to folks who seem to know little or nothing (there is a shocker).

They say I can turn the car in to any Mazda dealer, as we figured.

They said for me to contact the dealer for the pre-turn in inspection, which is not what we thought or what other lease banks do.

On the buy out, they said I had to go through the dealer for that and NOT direct with them. Again, the is backwards from other lease end deals I have done.

Since you are buying yours, who/how are you buying it? From a local dealer, leasing dealer, or MAC direct? These folks I talked to seemed to have no clue at all.

Thanks!
Dennis

SC-ed

My local dealer. They should handle the paperwork.
And probably make some dealer fees profit.
But I'll see 2-3 dealers and find the lower fees.

dwynne

Yesterday I talked to owner of the dealership where I leased the car. He said if I wanted to buy it they would do it for free (nothing other than the car, tax, and tage/title fees). He admitted that the paperwork would be really simple and not that big of a deal. He gave me the F&I folks names so I could talk with them directly when/if the time comes.

I think I will shop the local dealers as well, it is about a 6 hour round trip to go get the "Free" paperwork done. I can also go through the non-Mazda dealer I have used in the past.

I told the owner if they would sell me a speed3 for invoice I might just turn my 8 in and drive home in the new car . He said he might not could do invoice, but he would let me know what he could do. I am just thinking about it. I don't like FWD but a loaded up speed3 (at invoice) is not much more than my loaded 8 GT w/NAV and I always like to get something new. The larger, heavier AWD speed6 is interesting too - but they no longer have the $3,500 or $3,750 dealer incentives on it like they did last year. If I were to get one of those it would have to be at or below invoice then take off a lot of incentive money to make it cheap.

Dennis

MazdaRich

Looks like a number of us are in the same boat. My car has a couple cosmetic issues that are probably going to cost me some money to get fixed before turn-in. I also have some koni shocks and mazdaspeed springs that need to come off the car and re-sell. Maybe that will cover the cost of repairs.

I bought my car 600 miles away, so I'm glad I can turn it in here. That's not what they said in the letter to us!

dwynne

I would get a pre-turn in inspection done ASAP and see what they say. The size of allowed damage and the amount can be quite a bit - more than most may think. You should always get the inspection done prior to turn in, then you have the option of fixing things yourself - like new tires, get dents popped back out, etc. If you don't, then THEY decide how much the repairs will cost and send you a bill - and that is usually a lot more money.

Sounds like you decided to let yours go back. When they had the cheap lease money factor coupled with large MAC rebates (plus the Gerber rebate, if you had one) that must have leased a lot of cars. There may be a lot of used 05 8s on dealer lots and rolling through the auction in the next few months.....

Dennis

dwynne

I had a dealer tell me this week that Mazda does not offer the turn-ins to the turn-in dealer, they take them to the auction.

True or not, I don't know, but they said it did not matter which dealer you used and that was one of the reasons the dealer could not offer you the car for less than buy out - once you turned it in the car belongs to Mazda and is headed for the auction block.

Dennis

SC-ed

I did buy out my lease today. Got a 5.3% financing from my CU and the dealer of course couldn't beat that. But I had to pay the acquisition fee again for not using the original dealer I leased the car from. That is a MAC requirement.
At least I didn't have to drive 500 miles again.

dwynne

What? That does not sound right at all. MAC (the drones that answer the phone) and folks at a couple of dealerships told me the car could be turned in or purchased through any Mazda dealership. They did say that each individual dealership could charge a paperwork or "doc" fee to recoup the cost of doing the transaction.

I find it hard to understand why they would charge you the $595 acquisition fee over again. For that money, I will drive back to the selling dealer.

I have gone and looked at some potential replacements, but I really like my 8 (except for the crummy gas mileage) so most likely I will buy it at lease end.

Sweet rate, by the way. Capital One around 6.35% to 6.65% on a used car from dealer purchase.

Dennis

SC-ed

My acquisition fee is $475 actually and MAC call it processing fee this time and you have to pay it if you are going through a different dealer. I didn't believe it at first to and called MAC and talk to a business lease manager or something who confirm it. And I paid doc fee also. The dealer has to make some money.
Yeah, it would've been a little cheaper if I went to the original dealer but for saving $200-$300... Didn't feel that way.

dwynne

I guess mine is going back to Mazda. I got a good rate to buy it out (6%) but I decided for the money I would rather have something else. My wife told me not to buy it since "it will not be long before you want something else, something new". She is right. My buyout is a nice price, to me, but looking around at others similar cars for sale it is not a super deal. I would need to keep the car and drive the value out of it over time. since trade in value is so bad. So now is the time to move on, I think. Once I pay 7% sales tax on the buy out I will be way upside down on a trade and might stay that way for a while.

I had my car inspected, passed with flying colors. The only thing they found was 2-3 small paint chips on the nose of the car and that is not a problem for the turn in.

I talked to MAC again and they did confirm that if you buy it from a different dealer there is a charge. They did confirm you could turn it in to any dealer without penalty. They basically said they would LIKE for you to return it where you got it, but "if you have move 75 miles or more away you can turn it in to a closer dealer". MAC said the turn in dealer COULD charge for paperwork/time and trouble since they have to mess with your car and did not lease it to you - so you have to ask. I have not moved, but I did get it 3+ hours away so I will turn it in locally. I talked to the guy there and he said no problem and no fees.

The nice thing about leasing is not taking the risk on future value - had I taken out a long loan on the same car I would have been paying a lot more per month and might still owe more than the car is worth trade or retail. If I had done the purchase I would not have gotten the MAC lease incentives so would have paid a good bit more.

If I don't sell it, this will be my first lease car ever to turn in. I have ALWAYS found a buyer for the others either during the lease or at the end and made a little money on them - 4 times in a row.

Dennis

rotten42

This is my first lease. It is due up next year and I have had nothing but problems. A month and a half in my first engine blew. Since them I've had:

second engine replacement
3 sets of brakes
two air bags reaplcements
both seat warmers replaced
leaking injector
climate control replacement
many other smaller issues
...and now rust in the wheel well (in under 3 years!)

My question is what kind of experinces have you had regarding penalties for wear and tear when turning the car in. I've heard some horror stories. I've also heard that they try and muscle you into buying out the car by telling you about all these charges you will have if you bail on the car at the end of the lease.

I'm preparing for a fight considering all the time my car has spent in the shop and all the fights I've had to get them to fix things.

dwynne

I don't know, all my lease cars have been in above average condition and below allowed miles.

You do get a pre turn in inspection done with the last couple of months of the lease. After the inspection, MAC will let you know what kind of prices (if any) you can expect to pay for excess wear and tear. Then you have the option of paying them to fix the car (bad idea), fixing it yourself for less, or selling/trading the car off.

Do you have rips and tears in the interior or dend, dings, and chips to the exterior?

I used to have a BMW M5 - thought it would last me "forever" with so few miles I would drive it per year. With less than 15k on the clock things started braking and I was stranded in the car 2 months in a row. I managed to sell it and make a little bit before the next thing broke. That is one of my fears with the 8. No more miles than I drive it should last me "forever" but I am not that confident - and neither is Mazda given the high cost of an extended warranty.

Dennis