2016 SEL lease ending, buy and sell or just return?

Hello all,

I leased a 2015 SEL that VW replaced with a 2016 SEL with Drivers Asst Package because the 2015 was a lemon. The 2016 has been perfect. Anyway, they didn't change the terms of my lease so the car should have a much higher value than if it were a 2015 without the DA package. I will owe about $14.5k when I return it. My question is, should I return it and pay the $350 fee or buy it and try to flip it for a small profit?

If I could make a $2-3k off it, I would buy it out but I'm not sure if there will be any demand for it with all these cars coming out with a much further range. My lease ends 12/27 and my new Model 3 should be arriving in late December or early January (I configured it on 12/7 and they said 4 weeks until delivery).

What are your thoughts?

You might not make that 'profit'. It's selling at dealers for $15k

So you won't make anything and you will owe Sales Tax on $15k.

Buy it if you intend to keep it, otherwise give it back. Short of something major causing a massive spike in fuel prices, any profit you make is going to be small.

I would check with VW Credit to see if you can extend the lease, because Elon Musk has a bad habit of being overly optimistic with targets, both dates and numbers.

So it turns out I owe $14,144 on it (to buy it). I did a KBB.com instant offer and their price was $14,800. When it gets closer to the time to trade it in/take delivery of the Model 3, I think I'll go to Carmax and see what they offer. If I can make a few bucks off it and avoid paying the $350 return fee, I think that makes the most sense.

Side note, I've never paid sales tax on a car I've sold before. Do some states make you pay that?

If you buyout a lease car you owe tax on the Residual.
If you turn into Carmax, they have a Resale License so they don't have to pay it.

Carmax has 1 eGolf and they are selling it for 16k....so you might get that 14,800 you are looking for.

BTW I forgot to mention

Before you do anything call VW and get the car inspected. That's Required if you want to return and also will help you against some gotcha's at the end.
You have 90 days after the inspection to fix whatever they find wrong. (Or just pay)

If you turn into the dealer sight unseen, the dealer will call the inspector (Or VW will) and now you are screwed, anything he puts (6" chip on door) and you are out of $$$$$

Good to know, thanks for all the advice everyone.

As far as tax goes, I live in MD and had to pay taxes on the MSRP when I first signed the lease (it was painful). I shouldn't have to pay that again, right?

Patrick

preilly44 said:

Good to know, thanks for all the advice everyone.

As far as tax goes, I live in MD and had to pay taxes on the MSRP when I first signed the lease (it was painful). I shouldn't have to pay that again, right?

Patrick

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I don't know about Maryland tax law, but in California you pay sales tax as you pay for the car. When you sign the lease, you pay sales tax on any down payment or capital reduction (including the $7,500 credit from VW equivalent to the tax credit), then you pay sales tax on your monthly payment, then if you buy out the car, you pay sales tax on the residual.

One tip for any lease return - take thorough pictures of the car on the car lot where you returned it. That is your evidence of the car's condition at return. I've heard many stories of cars damaged on the lot where they returned the car, which the finance company tried to blame the lessee for.

miimura said:

One tip for any lease return - take thorough pictures of the car on the car lot where you returned it. That is your evidence of the car's condition at return. I've heard many stories of cars damaged on the lot where they returned the car, which the finance company tried to blame the lessee for.

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Once you get inspected...that's the most important. Pictures can't show scratches easily. But yes you should get pictures as well.

Great, thanks for the advice.