Early Lease Buyout

I have a 2010 Prius which im currently leasing for $229 per month.I have 6 payments remaining and I am definetly going to but it in the end(should have financed in 1st place but thats another story).Has anyone done a lease end buyout or early buyout through Toyota Motor Credit?If so what can I expect.My buyout is only $16500 so i dont expect them to negotiate the price.Also on an early buyout is it just the remaining payments + the buyout price or is there more involved.Thanks in advance for any help.

Depends on the lease. Have the fiance guy at the dealership look at your lease and and he'll tell you all the numbers.

If you buying a new Toyota and the lease is with Toyota it is ALL negotiable. They have three numbers to play with, the actual residual value of your car, the financing on the new car, the price of the new car.

A smart dealer is going to tell you "We'll take care of all that" and just present you with the price of your new car with no cash down payment by you if you want to roll that into the monthly payment.

Six months into my 2012 Prius III/3 I wanted to get a PriusIII/4 and dealership said no problem, just bring it in and you'll drive out in a 2012 Prius III/4 of your dreams for a "slightly" higher lease payment.

leasing.... lol

Why are dealers scumbags?

- They talk people into leasing cars.
- They sell extended warranties using lies and deception. The most common is telling people that if the battery dies after 3 years or 36,000 miles it will cost a lot to replace.
- They sell people extended care packages that cost 5X what a standard maintenance would cost.
- They sell all the misc BS. Teflon coating seats, rust proofing, and many other worthless items.

The early buyout calculation is spelled out in the TFS lease (from memory, it's the residual value plus the sum of the depreciation portion of the remaining payments--you should confirm in your lease). You can also log into your account on the TFS site & click on a button to get the number.

And that answers the OP's question...how?

I phoned TFS and they are very helpful. They will explain what you can do. There is no negotiation. You have a contract which you are buying out. You will pay less than the sum of the remaining payments as you will be ending the lease so no more interest will need to be paid. The buyout price of the car is also specified in the contract. So you can't negotiate that either.
The sooner you can get the money to them the lower will be the interest owed. Be aware, it takes 10 days I think it is for a check to "clear". Talk to TFS and talk to your bank. They can get the money "guaranteed" to TFS in a day, avoiding the 10 extra days of interest. It will cost you about $30 for the service but you will save $70-$100 in interest. A good bank will explain that to you, and TFS will as well.

Oh, and the dealer is not a "scumbag", he's just trying to make money. All he can do to do that is offer a service. He may not -tell- you how much the service is costing you but "caveat emptor" (let the buyer beware).

A lot of people walk into a dealer with a maximum payment they want to pay. With a lease the dealer can get the payment lower than buying the car with financing. In the long run the person leasing the car takes the biggest loss compared to buying.

Never buy a car based on a payment amount.
Never lease a car. People will post there are tax advantages but they are equal tax deductions for buying.

There is if you go to the dealer. He knows and can make money on the leased vehicle when the residual is less than he can sell it for. He can do deals on new car financing, rolling the value over residual into the new lease and use for downpayment or to lower lease costs. He can do deals on price of new car. Calling Toyota Financial Services they will tell you the "book" answers. They can't do any deals but the dealer has quite a lot to work with. Certainly worth giving him an opportunity.

If the value of the car is more than the lease residual you can purchase it and sell it and pocket the difference though letting the dealer do this and rolling it into the new lease as down payment is easier though he'll take his percentage.

To avoid the check clearing issue (and associated expenses) you mention above, if you have a TFS online account, you can pay online, which is credited to your account right away. That's how it works with monthly lease payments, so I assume paying a buyout wouldn't be any different.

You are not dealing with the dealer. You are dealing with TFS. Going to the dealer will just add his overhead. Buy out the lease from TFS directly. You won't have to pay the dealer anything. If you are going to buy another car, that may be different, but in this case the OP just wants to buy out the lease. Deal with the leaseholder.

The OP wants to do an early buyout of his lease, so I'm not following what your post has to do with his.

your residual (value of vehicle at lease end) does not change. if you pay off early you will pay

1) residual
2) remaining value of lease (can be looked at as "principal")
3) a lease buyout fee (which may or may not apply

you "should" not have to pay any "interest" remaining but then again, each lease is different. i would simply call them and ask what the payoff balance would be.

leasing is not a scam. in the OP's situation had he purchased, he would have had to put down MUCH more money and his payments would have been MUCH higher. keep in mind, when you lease, you are paying a "rental" fee (basically interest) on the unpaid balance of the lease which does not include the residual. the residual (value of car or purchase price at the end of the lease) does not carry an interest charge. granted, lease terms can generally be higher interest than purchase terms but the savings is still to the benefit of the lessee especially if he did not have the cash in 2010

Also, in many states you only pay sales tax on the total of the lease payments, vs. sales tax on the full sale price when purchasing.

To get a new Toyota I thought.

If so, the dealer can work with the lease residual buyout which, for a Prius, is typically lower than the leasee or the dealer could sell the car for if they bought it at the residual value. So there is money there a dealer can work with. A dealer also has new lease deals and new car deals he can work with such that the lessee can drive in with old car with six months left on the lease drive out with no cash outlay in new car on either new lease or new financed purchase.

I got that offer from my dealer with only two months into the lease.

That is why dealers are scumbags. Their goal is to turn cars and make a profit. The consumer eats a huge portion of the deprecation on the first and second lease. Then they have nothing. People never look at the real numbers over time.

If you...read...the OP's original post, he's going to do a lease buyout...so again, not following the relevance...

Thanks for all the advice guys,appreciate the help.

Lol,read my post,I said I regret the lease,however Ive saved over $8000 in payment over financing in the 1st place .Not everyone one is a rich guy from Fla that can pay cash for a Prius V.

Your math is a little flawed.

It reminds me of all the people that claimed they made out with sub-prime loans in the housing market. Their first year they paid below the prime rate and saved thousands of dollars that first year. After that is when things did not work out. The same applies to a lease.

Upfront it looks great and that is how scumbag dealers sell cars to people that cannot really afford them. I am not saying you fell into that category but it is common for a dealer to do this for people that buy on price.