Can a Lease-Take-Over vehicle be purchased rather than assumed?
vehicle lease packages can be paid out prior to the expiry date. In
order to determine how much it would cost to buy-out an existing lease,
simply call the original lessee and request they call the leasing
company for the pre-tax current buy-out of the lease. Upon receipt of
the buy-out, you can start the negotiation process with the original
lessee. Here a couple of important notes to remember:
- You will (in the
majority of cases) be actually purchasing the vehicle from the
original selling dealership – not the original lessee or the leasing
- The transaction
will be subject to both provincial sales tax and the goods and
service tax (PST & GST).
- The original
selling dealership will always attach an administrative fee to the
final selling price in order to be paid for their participation in
- If the lease
buy-out amount exceeds the negotiated selling price; the original
lessee must agree to subsidize the net difference between the two
amounts. For example, if the lease buy-out is $30,000.00 and the
agreed selling price of the vehicle is $27,500.00 – the original
lessee must supply a buy-out subsidy cheque for $2,500.00 plus
applicable taxes in order for the transaction to close.
- If a
"deal-in-principal" is made between the prospective buyer and the
original lessee, it is vital that the original lessee both
coordinates and engages the original selling dealership
representative for their required assistance in the closing of the
Q: How come there are listings with new-car dealerships as the contact; I thought
your leases were private lease-take-overs?
Leasebusters has partnered with several new-car
dealerships in an effort to enhance our business model. Our website and
service remains a very "private-sale" and private individual model,
however, the dealer program provides the following benefits:
- Expanded inventory, expanded selection - keep in mind
these deals offered by the new-car dealerships are still private
lease-take-overs being represented by the dealership.
- Several of the dealers that we work with are
dealerships located in new-car manufacturing towns and the client base
of these dealerships are predominantly factory employees whose leases
are originally based on dealer cost/invoice prices. As a result the
lease prices are typically very aggressive and competitive.
- Although many of the listings indicate the client has
to pay the transfer fee or some type of cash down; it does not mean you
have to capitulate. If you like the deal but don't like the 'down' -
make them an offer. The worst they can say is no thank-you.
Q: How much
does the new-car dealership or the leasing company charge for the lease
The transfer fee varies from leasing company to leasing company (and dealer to dealer).
If you are looking to get-out-of you lease, call the business manager of
your original selling dealership and request a lease-transfer-fee
quotation. If you are looking to get into a lease and the lessee is
requesting that new-lessee pay the transfer fee, simply speak to the
lease-owner (lessee) directly and request the amount.
I am interested in a vehicle that’s in another province; can I still take over that lease?
Yes. If the leasing company is a national company (all factory/manufacturer’s leasing companies are national companies), then all interprovincial Lease-Take-Over (LTO) transactions are perfectly acceptable. For example, LeaseBusters has had several Ontario-leased vehicles successfully taken-over, by residents in other provinces, including: Alberta, British Columbia and Nova Scotia.
To assist you with your shipping needs, Livingston Vehicle Transportation, "The Careful Car Movers" has recently partnered with LeaseBusters to bring an added dimension to the LeaseBusters experience and product offering. Whether you are searching for a Lease-Take-Over, or trying to get out of your current lease, you can now expand your market search across Canada.
Q: What do I need to consider when taking over a lease from another province?
If you’re considering taking over a lease from another province, there are three things to keep in mind: transportation costs, vehicle inspection, and ownership.
Normally, you can negotiate transportation costs with the lessee. Often, a lessee is highly motivated to transfer that lease. So, in order to have their lease taken over quickly, a lessee is often willing to incur other costs. If you’re considering a vehicle in another province, simply discuss your situation with that customer, and make an offer that includes the costs of shipping the vehicle. Remember; Livingston Vehicle Transportation is available to assist both parties with their vehicle shipping needs.
Since you’re not able to view the vehicle yourself, you’ll want to have the vehicle inspected to ensure it is mechanically sound, and in good physical condition. Ask the lessee to have the vehicle inspected by the original dealership, and fax, or email the results to you, for review. Livingston Vehicle Transportation also conducts a vehicle inspection, prior to shipping. Keep in mind that the majority of the vehicles available at LeaseBusters.com are new, and don’t suffer from problems common with older vehicles; in fact, most vehicles are still covered under the original factory warranty!
Be aware that when you take over a lease, the owner of the vehicle doesn’t change; only the legal lessee changes. For example, a Jetta or Passat leased through VW Credit is owned by VW Credit. If the lease is taken over by someone, the lessee changes, but VW Credit remains the owner. Since there is no actual change in ownership, provincial inspections and red tape are minimal, and affordable.
Q: How do I register
(pre-register) to get out of my lease??
Simply click on the “Get A Free Evaluation of
Your Lease” link on the home page. Upon opening of the page; thoroughly
fill in all the details required about you, your vehicle and the lease
package attached to your vehicle. After completing the required
information, press submit and the information will be sent directly
(electronically) to one of our Lease-Take-Over (LTO) Specialists.
Your LTO Specialist will completely evaluate
and assess your lease package – providing both the market position of
the car and its lease as well as historical data and the pros & cons
attached to your complete deal. Your LTO Specialist will then call you
(by telephone) to relay and convey their findings. After your
discussion with your LTO Specialist, you will both mutually decide
whether or not to retain Leasebusters to get you out of your existing
Q: I’m looking for a
specific vehicle that I cannot find within your inventory; how can I
find out if one becomes available?
Go to our Hot-Buyers-List link and sign
yourself up under both the Lease-Take-Over and Used car section. This
way you will always be informed (either by email or by telephone) of the
vehicle(s) that match your desires.
Signing up on the Hot Buyers List will allow
you to always be sure that you will not miss out on a great deal offered
by Leasebusters and/or Leasebusters.com
Q: Can I put a down payment
or trade-in on a Lease-Take-Over?
Lease-Take-Over deals cannot be re-worked to
accommodate a down payment or trade-in. If you have a trade-in you can
wholesale the car or sell the vehicle privately. After successfully
selling your trade you can apply the cash proceeds (resulting from the
private sale of your personal vehicle OR your personal cash) and deposit
it directly into your car payment bank account. Divide the proceeds by
the months remaining in the lease and what you have done is effectively
lowered the payment of the lease on your own.
For example: If you got $4,000.00 for the
private sale of your car OR your personal cash and the term remaining on
a Lease-Take-Over is 30 months. You divide 30 into the $4000.00 and
come up with a monthly subsidization of $133.00. This way, if the
monthly payment of the Lease-Take-Over is $585.00 per month, your
effective payment becomes $585.00-$133.00 = $452.00 per month.
Q: At the end of the lease,
am I responsible for any damage or excess wear and tear which occurred
before I took over the lease? What can I do to protect myself against
being assessed for damages that I did not cause?
Please follow the following generally accepted
practices and you will protect yourself right from the beginning:
Prior to signing any lease-assumption
documents; you as the new lessee must ensure that the subject vehicle’s
integrity is intact. You do this during the negotiation phase of the
transaction with the original lessee. Any Lease-Take-Over (LTO) should
be subject to an independent inspection performed by the original
selling dealer. The original selling dealer will inspect both the
mechanical fitness and physical integrity of the vehicle; this includes
an inspection for any previous accidents or undisclosed problems. This
inspection will act as your assurance policy. If the vehicle has
sustained damage from a previous accident but was repaired properly by
an accredited body-shop; you must get copies of the original repair
orders. In terms of maintenance; you should request the maintenance
records from the original lessee in order to confirm the vehicle has
been looked after. Regarding the vehicle’s service history; simply have
the original selling dealer print out a warranty repair history. This
history will let you know if the vehicle has had several warranty
problems or if it has been virtually problem-free.
Q: What process do I follow
if I want to take over a lease? What legalities should I be familiar
All lease transfers are credit-approved legal
transfers sanctioned by the Leasing Company. Typically, the original
selling dealership must participate in the transfer as they are the
selling agent for the Leasing Company. The following is the order of
- Go see the vehicle (inspect, test-drive and discuss the vehicle with the original lessee)
- Make a deal-in-principal with the original lessee (included who pays for transfer fees, inspections,
security deposits, cash incentives and/or down payments). The deal is subject to credit approval.
- Complete a credit application and submit
it to original selling dealership.
- The dealership will submit to Leasing
Company and wait for credit decision.
- Upon receipt of credit approval; the
dealership and the two retail parties (original lessee and
new-lessee) coordinate a delivery and signing date.
Q: My leasing company
indicated that my obligation must remain on the lease should someone else
take-over my lease what should I do?
If your leasing
company (the lessor) has that particular draconian policy (I say "if"
because GMAC and other major companies have rid themselves of that
policy); you can proceed forward keeping the following in mind.
Leasebusters has witnessed every major leasing company relax that policy
after they have reviewed and approved the credit of the prospective
assignee. If the new customer's credit is as good as or better than
yours, the leasing company will release you (they will claim on an
exception basis). The bottom line consists of two final points; (1) If
the new customer could qualify for a new lease from that leasing
company; why would the leasing company want your obligation to remain on
the lease and (2) If the leasing company approves the new customer, they
would not stand a chance at getting any money from you in court because
they (the leasing company) approved the credit of the assignee
originally. This fact is why GMAC and other companies removed that
policy. Furthermore, as Lease-Take-Overs become more popular, the other
companies will have no choice but to remove this policy - especially for
the sake of customer service.
Q: How come there are cars on the website that have been sold? Is your
database not pure?
sympathizes and apologizes for the frustration and annoyance resulting
from sold vehicles still being posted as available on the website. We
have experienced this issue for some time and have built and deployed
software to automatically update and delete old files. The problem,
however, is that the purification process is ongoing and sometimes
flawed due to the participation required by the "sellers"
marketing department has been mandated to continuously make
“data-purification” follow up calls with our all listed-clients. Our
mandate is to have a well maintained and pure database.
Q: Upon completion
of the lease-take-over, do I need to take the car back to the original
leasing dealership if I do not want to exercise the purchase option? If
so, does this typically mean shipping the car back across the country if
this is where it came from?
Every factory leasing company will
allow you to drop your leased vehicle at an associated new car
dealership that is closest to your home or place of business. You must
make contact with the leasing company at least thirty (30) days in
advance and one of their customer service representatives will provide
you with a dealership name and telephone that will be most convenient to
you. If you are considering a lease from an independent (non-factory)
leasing company, you must attain their “end-of-lease” protocol prior to
assuming the vehicle lease package. Be sure that this protocol from the
independent leasing company is in writing and that you fully understand
all the terms and conditions.
Q: What is a Cash Incentive?
A cash incentive is the amount of money that
the person who wants to get out of a lease is willing to give to someone who will take over his/her lease.
Often the cash incentive amount is discussed with the Leasebusters sales analyst in order for the Seller to
participate in this marketing decision. A cash incentive often consists of cash paid up-front, a refundable
security deposit and or a rebate for unused kilometers that the lease Buyer would be entitled to at the end of the
lease. See the Comments section and the Lease Take Over Summary of the vehicle's Details Page to review the cash
incentive that is being offered on the vehicle that you're interested in.
Q: What does the term "Effective Payment" mean? How is it calculated?
This payment takes into account either the
Cash incentive offered or
Down payment requested to calculate your effective payment. For example, if
the monthly payment is $500, there are 20 months remaining and there is a
$2,000 cash incentive, simply divide the $2,000 cash incentive by the 20
remaining months to establish a $100 per month incentive, which would give
you an effective payment of $400. If in the same case there was a down
payment of $2,000 instead of a cash incentive of $2,000, simply divide the
$2,000 down payment by the 20 remaining months to establish an effective
monthly payment $100 higher than the actual payment, which would give you an
effective payment of $600.00. The effective payment is an approximate
figure that is calculated by dividing the incentive/down payment by the
number of months remaining, and subtracting this amount from the pre-tax
payment. *****Please note that as a result of variances in sales taxes
between the different provinces, this number should be used only for the
purpose of approximation. For a more precise calculation, use the payment
including your local sales taxes and subtract/add the monthly
incentive/down payment using this figure.
Q: What is the Leasebusters listing fee?
Leasebusters only charges a listing fee after
the no-charge evaluation has been performed and the lease/vehicle has "passed" the market position evaluation.
The listing fee is $299.00 plus GST. Leasebusters offers multi vehicle discounts, loyalty discounts and finance
company partnership discounts for eligible customers.