GMAC Lease Buy-Outs vs. Current Market Value

[Petzy]

Heads up to current lease clients...Since the market is down on many models and segments it is possible to have your lease buy-outs adjusted.

We have had some clients have thier buy-outs lowered by over $3000.

Right now Cobalts work well, Trail Blazers, Uplanders and more.

Post your current vehicle and the anticipate buy-out because if you compare it to market value they can be way off.

We had a 2007 Cobalt come due with an $11,000 buy-out..no way a 4 year old Cobalt with 80,000 km is worth that in todays market

Lower Your GMAC Buy Out

[quadzilla]

Maybe you could explain how you 'adjust' these contracts to a lower buy back price for everybody?

Since the purchaser signed a contract stating how much the buy back.

[Petzy]

Maybe you could explain how you 'adjust' these contracts to a lower buy back price for everybody?

Since the purchaser signed a contract stating how much the buy back.

Dealers have always been able to buy the vehicles that are coming off lease from GMAC at market value. Historically we were unable to buy the vehicle for market value and then sell it back to the original leasing client. GMAC changed this because when the market value shifted everyone was sending thier vehicles back to GMAC which was lowering the price at the auctions and costing GMAC a lot of money in remarketing costs.

Most dealers do not offer the service at a lower price becasue they will make the difference between your buy-out and the market price in profit.

Here is an example of one that I did this week on a Cobalt:

Without adjusting the numbers you would have to pay this:

1)   Your Buy-out:                    $8,421

2)   Remaining payments
       2 x $344.55                           $689.10

3)   Admin Charge:                  $199.                     Maybe more in Toronto

4)   Taxes (GST & PST)           $1120.60

GRAND TOTAL:                                 $10,429


My goal would be to lower the buy-out and waive all admin fees. The Grand Total I can offer will be $9020.76 which represents a savings of $1,408

Here is the link to my site where people get quotes for an adjusted buy-out:  Lower Your GMAC Buy Out

[sirAQUAMAN64]

Petzy, took a look at your web site and it has an interesting presentation with honest approach.

Your continued contribution and perspective have the potential to add real value to the forums. Certainly a few members would love to lower/negotiate their buy-back if possible, and I'm interested in stories you could share and customer reception to new vehicles.

So stick around, and success in selling!

[TopGun]

So stick around, and success in selling! [/color]

Ya...and if you can get me a ZR1 for something like $30,000, then I'm all in.   

Well done fat man from Kentucky!  This is a masterpiece!

http://www.youtube.com/watch?v=RlvQLQTtOmk  4:45

[johngenx]

There was a time when the Corvette seemed to be sadly fading away.  Suddenly, in the 1990's, it was back.  Engines became heroic and handling stupefying.  Corvette mojo spread to the Caddy crew, and within a short time, GM was building the some of the coolest performance four doors around.

Somewhere within GM are car guys, and they seem to have free reign in some places, but are not allowed near the "normal" vehicle design groups.  Imagine if the Corvette gang were told "give us a Miata crusher.  Yes, boys, the dealers want a $30K RWD rag-top that is fun."  The Solstice was cool, but...

What about the Compact cars?  Imagine if the Cadillac virus infected the "Cruze?"  I bet the name would be gone, right off.  Wheel openings would be tight, engine bays worth looking at, and cockpits aptly named.  The Mazda3 crew would be scurrying around, wiping the "smile" off the 3's face and off their laurels.

[Petzy]

So stick around, and success in selling! [/color]

Ya...and if you can get me a ZR1 for something like $30,000, then I'm all in.   

Well done fat man from Kentucky!  This is a masterpiece!

http://www.youtube.com/watch?v=RlvQLQTtOmk  4:45

Thanks Top Gun,

I have to say that I like this forum a lot and I can't believe it took me this long to find it. To all members if there is a question that I can help out with regarding the auto biz please feel free to ask. I will do my best to always be straight forward even if you want to know costs, credits or anything related to my business.

[Turbo Bob]

So stick around, and success in selling! [/color]

Ya...and if you can get me a ZR1 for something like $30,000, then I'm all in.   

Well done fat man from Kentucky!  This is a masterpiece!

http://www.youtube.com/watch?v=RlvQLQTtOmk  4:45

Thanks Top Gun,

I have to say that I like this forum a lot and I can't believe it took me this long to find it. To all members if there is a question that I can help out with regarding the auto biz please feel free to ask. I will do my best to always be straight forward even if you want to know costs, credits or anything related to my business.

Have to agree with sirAqua, your site is an honest refreshing change, well done!

[Petzy]

So stick around, and success in selling! [/color]

Ya...and if you can get me a ZR1 for something like $30,000, then I'm all in.   

Well done fat man from Kentucky!  This is a masterpiece!

http://www.youtube.com/watch?v=RlvQLQTtOmk  4:45

Thanks Top Gun,

I have to say that I like this forum a lot and I can't believe it took me this long to find it. To all members if there is a question that I can help out with regarding the auto biz please feel free to ask. I will do my best to always be straight forward even if you want to know costs, credits or anything related to my business.

Have to agree with sirAqua, your site is an honest refreshing change, well done!

Thanks Guys...I have always found that advertising pricing including all taxes and all fees had the best reaction from clients...I cant stand the way advertisers hide freight, air tax, gst and pst out of payments. People want to know what it costs them period...Not walk into a dealership so we can get the magnifying glass out to explain the fine print.

[Petzy]

Can anyone comment whether or not they know if any other leasing companies like Ford or Honda offer this?

I know Honda values have fell recently below their predicted residuals.

I get asked that all the time but I have no clue.

[Canada Stig]

Can anyone comment whether or not they know if any other leasing companies like Ford or Honda offer this?

I know Honda values have fell recently below their predicted residuals.

I get asked that all the time but I have no clue.

If you could find this out it would be amazing - my residual on my 07 Odyssey is $19K and change, and new ones are going out the door with a $16K residual - meaning I am stuck with the car until the absolute end of the lease as the residual is too high (you used to be able to swap a Honda after about 2 1/2 years into a 4 year lease - not anymore!) 

If I do keep it till the bitter end - 9 more months - I suspect I may want to buy it, but at the new market price.  Strangely, the dealers in the Hamilton/Burlington area are still charging an arm and a leg for used Odysseys (and all used Hondas, for that matter) - about $8-10K more than the auction prices on average.  That's a pretty sweet profit.

Honda, of course, is notoriously difficult to deal with in any of these situations.

[AutoBroker]

Let me put it the way I see it:

- you lease your vehicle from dealership, but signed contract and paying directly to head office financial branch
- dealership has no power to change anything, including buy-out numbers
- at the end of the lease you have few options: walk away, buy-out and las one - do appraisal and in case if dealer give you offer to buy your car for more, than contractual buy-out number, you may have positive equity towards lease/purchase of new car at the same dealership.

Therefore: buy-out number are not subject to adjustment or change at the dealers level.
Let's look at the 'Current market value'. Manufacturers do their best to plan ahead and predict sales volumes, depreciation, demand, etc for all models for years ahead and based on this they establish prices, discounts, rebates, interest rates, and - lease buy-out numbers.
There are cases when for specific (good cars in demand) models you can get positive equity, but in most cases - no.
So when dealer sees your nice car, they may offer you better number than buy out (knowing they will be resell it with good margin), plus opportunity to sell you a new car.

The bottom line is: there is so called 'deal zone' - the area where the deal is possible, but quite often dealership is not sharing benefits equally, but pushing line to the area where they getting most benefits.
 

[johngenx]

The leasing company has no obligation to enter into negotiations with the leasee, but it might be in their interest if they can sell the car to the leasee at a value that might be more than they think they'll realize from an auction.

The only car I've ever leased was my 98 Mercedes.  Back then, MB Finance was very open to all kinds of possibilities at the opening of the lease.  I wanted the lease payment to match my car allowance, so we raised the payment and lowered the future buyout value.

I decided to buy the car early, if possible.  I knew that MB Finance had no obligation to do anything more than charge me the remaining 13 payments.  However, they came up with a present value of the payment stream.  Of course, this present value had a discount rate, and I thought they used too low of a rate, as it was significantly lower than their posted lease rates.  After some negotiation, we came up with a cash buyout I thought very fair, with the discount rate slightly higher than their posted rate.

Depending on the circumstances, everything is open to negotiation.  If you don't ask, you'll never know.  Sometimes the finance arm simply says "pound sand" and then you decide where to go from there.