The end of the new car lease is an important day. Decisions made can have long term implications. The procedure leaves most people with a bad taste in their mouth and can prevent them from pursuing another lease vehicle.
On the day the new car lease is over it's time to take the vehicle back to the dealership. Although this article focuses on returning the old vehicle remember that customers have 3 options.
Buy the vehicle outright, roll into another leasing agreement or walk away. Each dealer handles the lease return process differently, but most are looking to keep your business. Use this to your advantage.
Some dealerships just say thank you very much and let the leasing company handle the post term inspection, including contact, negotiation and billing for required repairs. Some dealerships will perform the off lease vehicle inspection and report to you directly. What will they report on?
The contract you signed stated you would be responsible for any damage to the vehicle, considered above and beyond normal wear and tear.
This statement alone is very ambiguous and open to interpretation. What's normal wear and tear? Again this will be different between individual leasing companies.
In my experience the leasing company will let you slide on a few minor nicks and scratches. However, they will charge you full retail price for repairs such as body damage and vandalism.
This is why you would want to prepare the vehicle for turn in before the final inspection occurs. You can fix the car cheaper on your own by shopping around for the best prices on the needed repairs.
When the lease company’s saw their customers upset to the point of refusing to lease a vehicle again they developed a strategy to assist on the new car lease turn in procedure.
A few company’s started providing a free inspection a month before the end of the contract. This helped prepare the consumer of what to expect.
This is where I came in. I worked for BMW North America and GE capital as an independent contractor and performed these free inspections. They paid me to go out to the leased vehicle and educate the consumer on chargeable damage so they were ready for turn in day.
I found most people never read the lease contracts and had no idea how the termination process worked. Although I was there to help and an unbiased third party independent contractor some saw me as the enemy.
I would point out chargeable damage on the vehicle and provide helpful instructions for the repair of the deficiencies. The new car lease company paid for this service in full. I also performed a mechanical inspection and forward the results to the company.
The thorough inspection often had the leaser on the hook for tire replacement. BMW required 4/32 of tread depth on the tires at the turn in point, because they would rather have you pay for it.
Tires can be expensive on some vehicles. Remember the leasing company banks on reselling the automobile in question as a low mileage perfect looking unit.
This sale brings top dollar values and is how the company makes multiple incomes from just one car. First they made money on the lease and the required repairs to return the car to top notch condition.
Then they make money on the resale of it. This double profit system is why they push and incentivize the lease program.
If bad things happened to this car while you leased it you will have to pay for the restoration of the unit. Chargeable car damage or penalties will vary with each lease company.
As far as the BMW inspection procedure the company had me take digital pictures of the damage and also the current odometer reading and VIN plate to assure they where in the loop about the condition of the lease vehicle.
Most people did not like the inspection procedure even though I was there to help them avoid common contract end troubles. For many this was the first time they could actually see the costs involved with leasing the vehicle and having to return the car or truck for resale.
Some drivers make what they consider upgrades to the external appearance. This is not recommended on a car you do not plan to buy out.
On this Honda lease vehicle pictured on the right the after market wheels would be a penalty. Most leases require factory wheels and tires to be reinstalled at termination.
It's only human to get attached to cars. Having someone point out its deficiencies can be unsettling. My advice is to obtain a written guideline for what's required at the end of the contract.
Take the required steps and repair the vehicle yourself instead of letting the company do it. You can save hundreds of dollars with a little DIY. I hope this sheds some light on the end of a new car lease and things go smooth for you.
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