I need your advice. I'm about do to something that can either further mess up my credit, and/or save it all together. Here is the situation. In August I had written confirmation of a Job Offer that paid me $8,000 more than I was making. It was a "sure" thing and so I decided to up the anty and turn in my Ford Truck lease to upgrade to a Ford Expedition. I don't know what I was thinking when in the finance closing I agreed to payments that (although affordable to me) are outrageously about $800 a month for an Eddie Bauer Expedition loaded with everything. Just call me an example of WHAT NOT to do. September 11th, the day that changed everything for us, changed it also for me. My offer of employment was rescinded and previously what was affordable payments have become an exceptional burden, putting me in jeopardy of loosing a lot of what I've gained over the past year. I decided that it might be best to return this Lease, but first securing financing on a smaller more economical car that is good on gas, presents a payment of less than $300 a month, and looks good. I found a great deal on a VW and test drove it yesterday. They just called me a short while ago and said "Congrats, the car is yours". It's overwhelmingly a good idea to reduce my financial obligations. It will enable me to save money, to continue my Graduate Class's in January and I'll be better off. However, I fear what will happen when I return my Lease to Ford. Are they going to have a cow? Are they going to make my life a living hell? What should I do to make this a smoother transition? I know that there will be penalties to pay with the early lease termination, it says so in my contract, but I am contractually entitled to end my lease early..there is nothing that says I can't. I'm going to refinance my house and I'll use that extra money to pay any penalties or differences (especially the $5000 I've been carrying on my past two car notes from a car I fully financed and went into my first least as being "upside down". That 5K has not disappeared yet...and I am prepared to pay it. This is why my payment is so high. I seek the advice of the sages on this board. I won't make a move until I hear from you. Thanks!
read your contract. Most early termination of leases will put you about $10K in the hole on a reasonably priced car. I choice to purchase for this reason, at least i won't be in the hole so badly if i wanted to rid it. You can call up the financier and ask them what the total cost of termination of the lease will be. Either way, they will want their cash at the time of termination..
Wow! That much eh? Do I at least get kissed?!? Still, if I roll the 10K into my Mortgage and thereby save myself from descending further into Sub-Prime Hell having to pay higher interest rates for longer for other things later in life, It could be better off in some ways. However, I do admit that's a lot of money to shell out. A V E R Y expensive lesson in, "Don't count chickens" and also "Don't loose your head over that new car smell walk if you suspect you can't afford a payment...you can always return later to buy" Exactly why I will purchase the VW. I need to go into this knowing that I will have this car for more than a year or two. I can always give it to my niece when it is paid for as she'll be entering college just at the time I pay it off What would they do if I tell them they'll have to wait a few weeks for their $$ at that point?
From Lease Doc: "Voluntary Early Termination -Return Vehicle to the original dealer -Pay to the dealer the difference between the Current balance and the Fair market Wholesale Value of the vehicle, plus a $200 early termination fee (except some California and Wisconsin leases.) The Fair market value will be determined, at your opinion, by one of three methods: 1. An amount agreed to by you and the originating dealer, or 2. The value which could be realized at the wholesale sale of the vehicle as determined by a professional appraisal obtained by you at your expense within 10 days from the termination from an independent third party agreeable to Ford Credit, or 3. If not established by agreement or appraisal, the net amount received by Ford Credit upon the sale of the vehicle at wholesale."
You know, I would also explain the situation to them that Sept 11th nixed your good new job opportunity and the economic outlook has changed. Auto dealers - in particular have been getting a lot of buisiness touting the "Keep America Rolling" slogans and patriotic themes and they just may be willing to work with you on a hardship claim. Especially if you couch your offer in a "Once we get this economy back on track I will (probably) be back if you treat me right" kind of way. Myschae. Just my .02
Thanks very much for your input, I will certainly take this approach, and it is very true. I wish to come back when things are better for me $$ -wise and I will make a big point of if they treat me well, I'll repeat my business. It should also vouch for my integrity with this being my third vehicle purchased at this dealorship.
Figure about 10% below KBB "TRADE-IN" value is what they'll get for the vehicle. Then Subtract that from your payoff and thats reasonable..
Last year I leased a Honda Accord EX valued at around $22000 only to find out a couple months later that my company would offer me a Volvo as a company car. Obviously it was in my best interest to turn the car in spite of the penalty I would pay. I turned the car in 3 months after signing the lease and paid a $3000 penalty.. the fair market value minus the value of the lease. I think you should probably be looking around the same amount.
