Buying out my lease with shitty credit
11-20-2012, 04:23 PM
#1
Drifting
Thread Starter
Buying out my lease with shitty credit
So I have about 15 months left before my lease ends (03/2014) and I would like to buy it out but I have shitty credit. How will this work? Do I need to put a down payment? Is it possible to buy out with really shitty credit? What happens if the application gets declined? Any BS fees I should look out for?
Ive never done this before.
I have the 11' ELITE package.
Ive never done this before.
I have the 11' ELITE package.
Last edited by defconskylude; 11-20-2012 at 04:29 PM.
11-20-2012, 06:07 PM
#2
So I have about 15 months left before my lease ends (03/2014) and I would like to buy it out but I have shitty credit. How will this work? Do I need to put a down payment? Is it possible to buy out with really shitty credit? What happens if the application gets declined? Any BS fees I should look out for?
Ive never done this before.
I have the 11' ELITE package.
Ive never done this before.
I have the 11' ELITE package.
What is your buyout amount and what is the street value of the car (i.e. trade-in value)? What are your monthly payments and what did you put down?
With bad credit you need to plan well ahead. You need to get pre-approved because otherwise you will gt screwed by the dealership.
11-20-2012, 07:16 PM
#4
Drifting
Thread Starter
i have to check the residual on the lease but it was negotiated up front as a purchase and ended up leasing it out.
im not familiar with credit unions. do you have to pay to be a member? i bank with chase. any benefits to a credit union over chase? how long do pre-approvals last? id just want to be prepared in case i get declined from acura.
11-20-2012, 07:17 PM
#5
This depends on several factors.
Have you bought other Hondas/acuras in the past?
They treat their repeat customers very well.
I'm a "preferred buyer" or whatever and I always get the lowest rates possible. Even when my credit wasn't so great.
Are you a member of a credit union?
What's your trade in value?
Try to get a loan pre approved before going back to Acura at lease end.
It'll give you a bargaining chip and something to fall back on.
If you can't get anything else, you'll sadly be left with whatever Acura offers you.
Good luck.
Have you bought other Hondas/acuras in the past?
They treat their repeat customers very well.
I'm a "preferred buyer" or whatever and I always get the lowest rates possible. Even when my credit wasn't so great.
Are you a member of a credit union?
What's your trade in value?
Try to get a loan pre approved before going back to Acura at lease end.
It'll give you a bargaining chip and something to fall back on.
If you can't get anything else, you'll sadly be left with whatever Acura offers you.
Good luck.
11-20-2012, 07:20 PM
#6
Drifting
Thread Starter
This depends on several factors.
Have you bought other Hondas/acuras in the past?
They treat their repeat customers very well.
I'm a "preferred buyer" or whatever and I always get the lowest rates possible. Even when my credit wasn't so great.
Are you a member of a credit union?
What's your trade in value?
Try to get a loan pre approved before going back to Acura at lease end.
It'll give you a bargaining chip and something to fall back on.
If you can't get anything else, you'll sadly be left with whatever Acura offers you.
Good luck.
Have you bought other Hondas/acuras in the past?
They treat their repeat customers very well.
I'm a "preferred buyer" or whatever and I always get the lowest rates possible. Even when my credit wasn't so great.
Are you a member of a credit union?
What's your trade in value?
Try to get a loan pre approved before going back to Acura at lease end.
It'll give you a bargaining chip and something to fall back on.
If you can't get anything else, you'll sadly be left with whatever Acura offers you.
Good luck.
im not a member but im interested. any recommendations? how does a credit union benefit someone with bad credit?
i really dont want to give my car back to acura because of the work i put into it.
trade in value should be low because of the modifications ive done to the body of the car. then again it would be moot if i have no intentions of trading it in.
should i get pre approved now even though i have 15 payments left?
11-20-2012, 07:43 PM
#7
Drifting
Join Date: Jun 2012
Location: City of Champs, MA
Age: 33
Posts: 2,969
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Just calculate what the buy out will be after those 15 payments, and shop around for credit unions in your area - pick the best one and see if they pre-approve you for the payoff amount. That should give you a ballpark estimate of what you'll be paying monthly for your car/your interest rate etc. once you buy out the lease. I don't think applying for pre-apporval will hurt your credit, will it?
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11-20-2012, 08:11 PM
#8
Credit unions give great rates but are pretty hard on credit ratings from my experience.
You could def shop around. Just take the payoff amount and see if you can get a loan for it.
For the repeat customer thing to matter, it has to be in your name.
After like 3-4 cars, they say you're a preferred client or something. Idk. I've bought a lot of Hondas and acuras lol.
I didn't know about this til my brother recently told me (he works at Honda)
See if your job has a credit union. Most companies these days are affiliated with one.
I guess if all else fails, you can look around on the Internet.
It sounds to me like you just want to be able to get financing with your credit.
How did you get a lease if your credit was bad?
I mean. I know it's possible but they rape you on monthly with bad credit.
I know this from experience.
If you end up paying a high interest rate, at least you'll build crest pretty fast.
I went from like a 650 to almost 800 in the last year with 2 cars in my name.
Just make sure to pay on time!
You could def shop around. Just take the payoff amount and see if you can get a loan for it.
For the repeat customer thing to matter, it has to be in your name.
After like 3-4 cars, they say you're a preferred client or something. Idk. I've bought a lot of Hondas and acuras lol.
I didn't know about this til my brother recently told me (he works at Honda)
See if your job has a credit union. Most companies these days are affiliated with one.
I guess if all else fails, you can look around on the Internet.
It sounds to me like you just want to be able to get financing with your credit.
How did you get a lease if your credit was bad?
I mean. I know it's possible but they rape you on monthly with bad credit.
I know this from experience.
If you end up paying a high interest rate, at least you'll build crest pretty fast.
I went from like a 650 to almost 800 in the last year with 2 cars in my name.
Just make sure to pay on time!
11-20-2012, 09:11 PM
#9
Карты убийцы
Mine is up in 04/2014... with the mileage and initial large downpayment, the car should be worth about $3500 to $4K more than the buyout. I don't know yet if I will buy-out or swing that money into another lease. When you only drive about 6000 miles a year, it nice to always have the warranty and never worry about tires, time belts, and basically only 2 oil changes (since the first one is free).
11-20-2012, 09:34 PM
#10
If you're not planning on doing anything for over a year then you have time to fix your credit - at least a little bit.
Pre-approvals generally last for 30 or 60 days but you should join a credit union now. CU have several advantages. The management generally knows the clients and often factors that into a credit decision. Rates are often much lower and they have various tools to help you fix your credit.
Go to annualcreditreport.com and order yourself a credit report from each of the thee agencies. Federal law requires the agencies to give you one free credit report for free annually so the three won't cost you anything.
Spend a weekend looking over each report carefully and make note of any errors. Dispute those errors.
Good luck.
Pre-approvals generally last for 30 or 60 days but you should join a credit union now. CU have several advantages. The management generally knows the clients and often factors that into a credit decision. Rates are often much lower and they have various tools to help you fix your credit.
Go to annualcreditreport.com and order yourself a credit report from each of the thee agencies. Federal law requires the agencies to give you one free credit report for free annually so the three won't cost you anything.
Spend a weekend looking over each report carefully and make note of any errors. Dispute those errors.
Good luck.
11-21-2012, 09:41 AM
#11
Go to annualcreditreport.com and order yourself a credit report from each of the thee agencies. Federal law requires the agencies to give you one free credit report for free annually so the three won't cost you anything.
Spend a weekend looking over each report carefully and make note of any errors. Dispute those errors.
Good luck.
Spend a weekend looking over each report carefully and make note of any errors. Dispute those errors.
Good luck.
taking the next 3-6 months to improve your credit standing can make a world of difference when it comes to interest rates. the only way to do that is to know what is on your credit report. and obviously the better credit standing you have, the lower risk you will be to the bank/credit union which in turn will afford you better terms when it comes to the lending side of things.
rates are extremely low right now for refinancing so there is a possibility that there won't be that wide of a gap between what chase offers vs a credit union so it's worth at least seeing what they can offer you since everyone is pretty low these days. you then would have to weigh the convenience of having everything in one spot aka all with chase versus saving .25% or .1% but having to start another relationship with another company.
BUT there's no guarantee that these rates will stay the same over the next year and a half which is why the best move is to start getting your credit moving in the right direction and continue educating yourself on the process. good luck
11-21-2012, 09:47 AM
#12
its tough to fix credit without getting in to more debt.
but yea.. def chk out your credit report.
see what you can dispute/ negotiate.
oh and be extremely diligent when trying to get errors taken off your report.
they dont give a damn whether its on there or not so you have to keep bugging them to get them to take items off.
i had a dealing like that with transunion. i had to call them pretty much every day for a month to get something removed and to make sure it was removed.
but yea.. def chk out your credit report.
see what you can dispute/ negotiate.
oh and be extremely diligent when trying to get errors taken off your report.
they dont give a damn whether its on there or not so you have to keep bugging them to get them to take items off.
i had a dealing like that with transunion. i had to call them pretty much every day for a month to get something removed and to make sure it was removed.
11-21-2012, 01:44 PM
#13
its tough to fix credit without getting in to more debt.
but yea.. def chk out your credit report.
see what you can dispute/ negotiate.
oh and be extremely diligent when trying to get errors taken off your report.
they dont give a damn whether its on there or not so you have to keep bugging them to get them to take items off.
i had a dealing like that with transunion. i had to call them pretty much every day for a month to get something removed and to make sure it was removed.
but yea.. def chk out your credit report.
see what you can dispute/ negotiate.
oh and be extremely diligent when trying to get errors taken off your report.
they dont give a damn whether its on there or not so you have to keep bugging them to get them to take items off.
i had a dealing like that with transunion. i had to call them pretty much every day for a month to get something removed and to make sure it was removed.
A year or so of spotless credit (no missed or late payments, no new credit requests etc) are worth far more than what happened several years ago.
If you can't manage spotless credit from here on out then you need to reduce the amount you are spending - have a yard sale and sell everything you haven't used in a half year; sell the mods off your car and get rid of any expense that doesn't involve shelter, food or clothing. Sell the TSX and buy a 10 year old Civic.
While it may sound harsh, the only way to good credit is to cut out all extravagance - eat mac&cheese and ramen noodles for the next few years (or however long it takes to get out crushing debt) drink water from the tap and don't go out with your buddies. If you're not sleeping then you should be out making money.
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Mercedes>BMW (11-21-2012)
11-21-2012, 02:14 PM
#14
idk.. i tried for years to fix my credit by paying everything on time and keeping debt to a minmum. i had no debt aside from my student loans and my car loan during this time.
my credit barely changed.
i then had to get a credit card to pay for a wedding and got a new car, then got another small limit card to get a ipad or something. i forget. anyway, 2 new cars and 2 credit cards and my score jumped 100 points in a year.
i would agree with you if i hadnt done it the complete opposite way and got great results.
lesson i learned..
living within your means doesnt get you credit.
borrowing and paying on time gets you credit.
but yea.. id highly suggest consolidating credit cards to 1 if possible and start paying that on time and charge some things here and there to keep the other accounts active and reporting.
my credit barely changed.
i then had to get a credit card to pay for a wedding and got a new car, then got another small limit card to get a ipad or something. i forget. anyway, 2 new cars and 2 credit cards and my score jumped 100 points in a year.
i would agree with you if i hadnt done it the complete opposite way and got great results.
lesson i learned..
living within your means doesnt get you credit.
borrowing and paying on time gets you credit.
but yea.. id highly suggest consolidating credit cards to 1 if possible and start paying that on time and charge some things here and there to keep the other accounts active and reporting.
11-21-2012, 02:49 PM
#15
from lifehacker
It's a Catch-22. If you have bad credit, you pay more in interest on home loans, auto loans, credit cards and more, making it more challenging to make your payments, get out of debt and improve your credit score. On the other hand, if you have good credit, you pay less in interest, increasing the likelihood that you can manage your monthly payments, keeping your credit score high and in tact. The truth is, no matter what your credit score is now, you can achieve the "platinum standard" of credit—a score above 800—and nab yourself the best deals on life's largest purchases. As your average 30-something, I've been in debt, struggled to pay bills and never had a substantial income to bail me out. But, the one thing I do have (now, anyway) is a credit score of 808. And I'm here to tell you my secrets:
Never miss a payment
I've never had a payment reported as late on my credit report. This is crucial to your credit score. Payment history makes up about a third of your credit rating. If you have a good score and miss just one payment, your credit score can suffer upwards of 110 points. Besides debt settlement, foreclosure and bankruptcy, a late payment is about the worst thing you can do to your credit score.
Of course, I'm human. I've had flaky moments where I forgot about a bill's due date and made my payment a few days late. While I was slapped with hefty late fees, I did not get the black mark on my credit report. But I may have been lucky.
Technically, a "30-day late" is any payment received one to 30 days after the due date, according to FICO. However, in many cases, your bank, creditor or lender will give you a grace period of a few days to up to the next due date before reporting your payment as late to the credit bureaus. Find out what your grace period is so you don't find yourself in a credit crisis.
Keep your balances low and your limits high
Another good chunk of your credit score is determined by your credit utilization, or how much credit you use (balances) compared to how much credit is available to you (limits) – the lower, the better. A good rule of thumb is to keep your balances well below 50 percent of your limits. As soon as you hit the 50 percent mark, your score will begin to take incremental hits. On the other hand, the lower you keep your balances below that 50 percent mark, the more your credit score will incrementally benefit.
As a point of reference, the average credit utilization of a person with an 800+ score is 7 percent, according to FICO. Mine averages out to 2 percent, depending on when I pull my credit, as I ordinarily pay off my balances in full each month.
If you're doing all that you can to keep your balances low, try your hand at the other side of the equation – your credit limits. This can be tricky, as the recession prompted many creditors to not only deny credit limit increases more often, but actually lower your credit limit based on the credit review they do on you. My advice would be to only ask for a credit limit increase if your credit card is in good standing and you have the income to support the possibility of greater debt.
Mix it up
Another ingredient to the 800+ credit score recipe is a good mix of credit—revolving credit (e.g. credit cards), installment credit (e.g. car loans, student loans) and mortgages. I've always had a good mix of the first two, but haven't yet ventured into home loan territory. Now, I would never recommend that you apply for credit you don't need, but be aware that the ability to manage different types of credit responsibly bodes well for your credit score.
If you only have credit cards and are eager to mix it up, consider talking to your bank about a savings- or CD-secured loan. This is a type of personal loan in which the money in your savings account or CD is used as collateral in case you default on the loan. This loan typically qualifies as an "installment loan," like car loans and student loans, and may help you break out of the credit card-only slump. If you go this route, make sure your bank will report your payment activity to the credit bureaus, so your timely payments will help your credit score.
Don't apply for credit you don't need, but don't close accounts either
With the exception of my college years, I never applied for credit I didn't need—and still don't. I have three regular credit cards, two of which I use often. I also have two retail credit cards that I use on occasion (mostly for the perks). One of my credit cards I use only for gas. Not only does this help keep my budget simple, but the little amount I charge on it each month, then pay off in full, will be reported on my credit report as "OK," thereby strengthening my credit history.
Each time you apply for a credit card or a loan, your credit score takes a small hit. While one or two won't hurt you that badly, many inquiries—especially in a short period of time—can. That's why it's a good idea to only apply for credit you need and try not to succumb to the temptation of "10 percent off your purchase" every time you hit the register at your favorite stores.
If you have any credit card accounts you don't use, don't close them! When you close an account, you're lowering the amount of credit that's available to you and if you carry balances on any other cards, your credit utilization will go up and your credit score may go down. Instead, you may want to dust off that old card and use it for small purchases that you will pay off in full each month—like me with gasoline. Ultimately, a good credit score is about more than having credit. It's about having credit and using it responsibly.
A good credit score is like having a coupon book for the biggest purchases you'll make in your life. The lowest interest rates afforded to those with top credit scores translate to lower monthly payments—in the case of a mortgage, that could mean many hundreds of dollars in savings each month. Given all those hard-earned dollars at stake, why wouldn't you manage your credit on a regular basis to make sure your score is where it needs to be?
Never miss a payment
I've never had a payment reported as late on my credit report. This is crucial to your credit score. Payment history makes up about a third of your credit rating. If you have a good score and miss just one payment, your credit score can suffer upwards of 110 points. Besides debt settlement, foreclosure and bankruptcy, a late payment is about the worst thing you can do to your credit score.
Of course, I'm human. I've had flaky moments where I forgot about a bill's due date and made my payment a few days late. While I was slapped with hefty late fees, I did not get the black mark on my credit report. But I may have been lucky.
Technically, a "30-day late" is any payment received one to 30 days after the due date, according to FICO. However, in many cases, your bank, creditor or lender will give you a grace period of a few days to up to the next due date before reporting your payment as late to the credit bureaus. Find out what your grace period is so you don't find yourself in a credit crisis.
Keep your balances low and your limits high
Another good chunk of your credit score is determined by your credit utilization, or how much credit you use (balances) compared to how much credit is available to you (limits) – the lower, the better. A good rule of thumb is to keep your balances well below 50 percent of your limits. As soon as you hit the 50 percent mark, your score will begin to take incremental hits. On the other hand, the lower you keep your balances below that 50 percent mark, the more your credit score will incrementally benefit.
As a point of reference, the average credit utilization of a person with an 800+ score is 7 percent, according to FICO. Mine averages out to 2 percent, depending on when I pull my credit, as I ordinarily pay off my balances in full each month.
If you're doing all that you can to keep your balances low, try your hand at the other side of the equation – your credit limits. This can be tricky, as the recession prompted many creditors to not only deny credit limit increases more often, but actually lower your credit limit based on the credit review they do on you. My advice would be to only ask for a credit limit increase if your credit card is in good standing and you have the income to support the possibility of greater debt.
Mix it up
Another ingredient to the 800+ credit score recipe is a good mix of credit—revolving credit (e.g. credit cards), installment credit (e.g. car loans, student loans) and mortgages. I've always had a good mix of the first two, but haven't yet ventured into home loan territory. Now, I would never recommend that you apply for credit you don't need, but be aware that the ability to manage different types of credit responsibly bodes well for your credit score.
If you only have credit cards and are eager to mix it up, consider talking to your bank about a savings- or CD-secured loan. This is a type of personal loan in which the money in your savings account or CD is used as collateral in case you default on the loan. This loan typically qualifies as an "installment loan," like car loans and student loans, and may help you break out of the credit card-only slump. If you go this route, make sure your bank will report your payment activity to the credit bureaus, so your timely payments will help your credit score.
Don't apply for credit you don't need, but don't close accounts either
With the exception of my college years, I never applied for credit I didn't need—and still don't. I have three regular credit cards, two of which I use often. I also have two retail credit cards that I use on occasion (mostly for the perks). One of my credit cards I use only for gas. Not only does this help keep my budget simple, but the little amount I charge on it each month, then pay off in full, will be reported on my credit report as "OK," thereby strengthening my credit history.
Each time you apply for a credit card or a loan, your credit score takes a small hit. While one or two won't hurt you that badly, many inquiries—especially in a short period of time—can. That's why it's a good idea to only apply for credit you need and try not to succumb to the temptation of "10 percent off your purchase" every time you hit the register at your favorite stores.
If you have any credit card accounts you don't use, don't close them! When you close an account, you're lowering the amount of credit that's available to you and if you carry balances on any other cards, your credit utilization will go up and your credit score may go down. Instead, you may want to dust off that old card and use it for small purchases that you will pay off in full each month—like me with gasoline. Ultimately, a good credit score is about more than having credit. It's about having credit and using it responsibly.
A good credit score is like having a coupon book for the biggest purchases you'll make in your life. The lowest interest rates afforded to those with top credit scores translate to lower monthly payments—in the case of a mortgage, that could mean many hundreds of dollars in savings each month. Given all those hard-earned dollars at stake, why wouldn't you manage your credit on a regular basis to make sure your score is where it needs to be?
11-21-2012, 03:33 PM
#16
^^ Correct. The main points are paying on time and having a low debt to available credit ratio. The longer you've credit in one place (i.e. one credit card) the more that counts towards your credit.
Paying on time for a half year will work wonders on your credit score.
Paying on time for a half year will work wonders on your credit score.
11-21-2012, 03:56 PM
#17
Moderator
any particular reason why you cant use someone else's name? wife? brother? mom? dad? cousins?
if you have bad credit and dont want to get screwed by the dealer, best is to not use your own credit for the car.... just a suggestion..
if you have bad credit and dont want to get screwed by the dealer, best is to not use your own credit for the car.... just a suggestion..
11-21-2012, 04:31 PM
#18
Cruisin'
Join Date: Apr 2002
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OP....is your current lease through Acura Financial Services? If so, have you been paying your car on time? If so, regardless of credit, Honda and Acura treat even people with Tier 4 credit as Tier 1 so long as you pay your car on time. I work in the industry....stating fact here. Just keep making those payments on time and when you are close to the end of your term, you will get approved, at whatever the pre-owned rate is for Acura in the future 13-15 months from now. No worries my friend...just pay that car on time 
11-21-2012, 04:35 PM
#19
Moderator
just curious, can you negotiate on a lease buy out even though the contract already states what it is going to cost to buy the car out and the end of lease?
if the finance company is AFS, do they have power to change the price?
if the finance company is AFS, do they have power to change the price?
11-21-2012, 08:20 PM
#20
You don't get a bad credit score from a few mistakes over a short period of time - you have to work at it.
Unless you are fully prepared - mentally and monetarily - of assuming the entire loan you are co-signing for, you shouldn't do it.
Co-signing a loan doesn't do the party with bad credit any favors either as it reinforces that there are people who will always bail you out.
If my son had bad credit (he doesn't) and wanted a TSX, then I'd buy him a 10 year old Civic and put it in his name.
Co-signing has many pitfalls in addition to the actual cost of the loan. The car will be in your name and you may be responsible for unpaid fines and accidents. Since you can't get blood from a turnip, anyone involved in an accident with your co-signee will sue you.
One reason that insurance rates raise with poor credit is that studies have shown that people with poor credit get more tickets and have more "at fault" accidents.
11-21-2012, 08:29 PM
#21
If the buy out is less than the price that the dealer can sell the car for, then there is no reason for AFS or the dealer to negotiate.
11-21-2012, 09:02 PM
#22
If you can't manage spotless credit from here on out then you need to reduce the amount you are spending - have a yard sale and sell everything you haven't used in a half year; sell the mods off your car and get rid of any expense that doesn't involve shelter, food or clothing. Sell the TSX and buy a 10 year old Civic.
While it may sound harsh, the only way to good credit is to cut out all extravagance - eat mac&cheese and ramen noodles for the next few years (or however long it takes to get out crushing debt) drink water from the tap and don't go out with your buddies. If you're not sleeping then you should be out making money.
Credit is a just another name for borrowing money. Interest rates on any savings will always be low while credit interest rates will always be higher. It's a system designed to get rich off of you. The only people who make out are the lenders, or the borrowers who take that money and get a bigger return on what it cost to borrow it in the first place.
You'll eventually need credit on a big life time purchase like a home and which in time can bring you some equity. In other words, borrow money only when you'll make a return from it. Cars are a big waste of money and it's worse if you have to borrow in order to buy them (there's no return aside from use value.) It might be better for you to stick to leasing and consider the rental fees as part of your own personal cost of living.
11-21-2012, 10:52 PM
#23
Cruisin'
Join Date: Apr 2002
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However, you should look into the TMV of your car prior to any buy-out. If you are in an equity or wash position...or even slightly under by a couple of bucks to the LBO...then buy it if you want the car. If the value of the car is way under the buyout...don't buy it, you'd be better off getting new car from Honda or Acura that fits your budget...unless of course you plan on keeping one car for a long time...then stick to what you have and drive it until the wheels fall off. I don't know what your financial position is, and really, it's no one's business but your own.
If you are worried about credit, like I said, pay your car on time and you'll be fine should you want to buy it out at the end. Ride the lease out...its a lower payment than if you wanted to buy it out right now at this very moment. To get your current buy out...log into your account to see what it is.
Remember, you have 13-15 months time frame to repair your credit...you can make great strides in that time period.
Last edited by mjiCLS; 11-21-2012 at 10:58 PM.
11-22-2012, 10:14 AM
#24
Let's assume that the buyout is $10k and the dealer retail is $8k. Why wouldn't the dealer (with concurrence of AFS) say to you "look, you like the car and aren't going to buy it for $10k but since you know the car and know that it is in good shape, how about you give us $9k for it?"
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drivedata (11-24-2012)
11-22-2012, 06:52 PM
#27
Racer
When I leased my new 2012 Acura TL from the dealership last week I was afraid of not getting approved because of a bankruptcy still on my credit report from 2003. I have financed a Nissan and obtained two credit cards plus I am paying my student loans on time since then. The score they pulled was 724 and I was financed under the advertised rate for well qualified buyers through Acura Financial. I have been working on my credit for the past 7 years. Never paid late and I always pay 90-100% of my credit card balance every month. After I was approved, the dealer reveilled to me that Acura Financial is one of the most difficult lenders to get approval through. If I knew that up front, I probably wouldn't have even tried! Credit problems don't get fixed overnight and credit unions have very strict lending guidelines as well as I bank through one. Once I screwed up my credit 10 years ago, they wouldn't approve me for anything. That was just my experience. If AFS is more lenient once your in the "club" as others have said then you might have chance. Again, paying on time, having old accounts in good standing, low credit utilization, and 1-3 credit inquiries factors greatly into your score as well as having diverse lines of credit. Good luck. Please let us know how the financing goes when you get to that point. Start repairing your credit now.
11-22-2012, 08:43 PM
#28
Cruisin'
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Incorrect. While the lease buyout cannot be higher than what was agreed to, there is no reason why it cannot be negotiated. It happens all the time.
Let's assume that the buyout is $10k and the dealer retail is $8k. Why wouldn't the dealer (with concurrence of AFS) say to you "look, you like the car and aren't going to buy it for $10k but since you know the car and know that it is in good shape, how about you give us $9k for it?"
Let's assume that the buyout is $10k and the dealer retail is $8k. Why wouldn't the dealer (with concurrence of AFS) say to you "look, you like the car and aren't going to buy it for $10k but since you know the car and know that it is in good shape, how about you give us $9k for it?"
Last edited by mjiCLS; 11-22-2012 at 08:46 PM.
11-22-2012, 09:15 PM
#30
Sorry, you are incorrect. There is no negotiations...period. The car is not the dealer's...it's AFS/HVT. The dealer who originated the lease has the right to buy it if the consumer turns it in....and they wouldn't buy a car out who's value is less than what was set in the contract as the buyout option. The cars then get sold at auction in places like Mannheim. Call Honda/Acura Financial services and let me know if you can negotiate the lease buy-out. Record the convo and post it. I worked for a Honda dealer up until recently....not even an employee can negotiate out of a contract, so I'd love to see what they tell you lol
11-22-2012, 09:18 PM
#31
What some random clerk tells you based on a hypothetical situation is far different from what a supervisor will tell the dealer's finance manager when you're sitting there with dollar bills falling out of your pockets.
11-23-2012, 03:17 AM
#32
Moderator
ive always thought you can negotiate as long as its financed through the dealer..
im sure that if the car goes to auction, there will be a lot of charges involved in getting the car to auction.. I.E. transporation, registration, other fee's..
the reason why i am asking is because my cousin has a tsx and his lease is ending in 2 months... it was through AFS and his car us under miles and pretty much perfect condition.
I valued the car via Edmunds and it was nearly 6-7k more than what the price that is listed on the lease contract. He is sold on buying out the lease but wants to know if it is negotiable.
im sure that if the car goes to auction, there will be a lot of charges involved in getting the car to auction.. I.E. transporation, registration, other fee's..
the reason why i am asking is because my cousin has a tsx and his lease is ending in 2 months... it was through AFS and his car us under miles and pretty much perfect condition.
I valued the car via Edmunds and it was nearly 6-7k more than what the price that is listed on the lease contract. He is sold on buying out the lease but wants to know if it is negotiable.
11-23-2012, 08:27 AM
#33
ive always thought you can negotiate as long as its financed through the dealer..
im sure that if the car goes to auction, there will be a lot of charges involved in getting the car to auction.. I.E. transporation, registration, other fee's..
the reason why i am asking is because my cousin has a tsx and his lease is ending in 2 months... it was through AFS and his car us under miles and pretty much perfect condition.
I valued the car via Edmunds and it was nearly 6-7k more than what the price that is listed on the lease contract. He is sold on buying out the lease but wants to know if it is negotiable.
im sure that if the car goes to auction, there will be a lot of charges involved in getting the car to auction.. I.E. transporation, registration, other fee's..
the reason why i am asking is because my cousin has a tsx and his lease is ending in 2 months... it was through AFS and his car us under miles and pretty much perfect condition.
I valued the car via Edmunds and it was nearly 6-7k more than what the price that is listed on the lease contract. He is sold on buying out the lease but wants to know if it is negotiable.
Let's assume the same scenario I listed before that the lease buyout is $10k. But now, the dealer retail is $12k (instead of the $8k of my prior example)
If you don't buy it, the dealer can turn around in a heartbeat and sell it for more than the buyout price so there is no reason to "cut you a deal."
The incentive is only there if the street value (probably the number between private party and dealer retail) is less than the lease buyout.
Cars go to auction when they are slow sellers/not the dealer's brand/bought cheaply - but no Acura dealer will send a TSX to auction unless it has issues. If the lease buyout is below market value and the car is in good condition then the dealer can certify it and get a premium for it.
This is basic economics. We should, however, get back to the OP's topic
OP - Cliff notes
Spend the time between now paying every bill on time
Get copies of your credit reports and dispute any errors
Forego any unneeded expenses until you get your finances right - that includes mods for your car
Sell what you don't need to make money
Sleep, eat, work, repeat
Last edited by ceb; 11-23-2012 at 08:32 AM.
11-23-2012, 11:31 AM
#34
Moderator
great info.. but bad news for my cousin.. lol
back to OP's topic..
can you find someone else to put the name under? maybe a main co-signer?
back to OP's topic..
can you find someone else to put the name under? maybe a main co-signer?
11-23-2012, 03:32 PM
#35
Bad credit, lease?
Something that seems to have been overlooked here...If your credit is so bad, how'd you qualify for the leased TSX in the first place?
End of lease buy out MAY be negotiated through AFS or it can be "back doored" through the dealer accepting the return.
We were offered a lesser price through MB but, declined then the dealer offered us an even better deal when we returned it.
End of lease buy out MAY be negotiated through AFS or it can be "back doored" through the dealer accepting the return.
We were offered a lesser price through MB but, declined then the dealer offered us an even better deal when we returned it.
11-23-2012, 05:14 PM
#36
Drifting
Thread Starter
it wasnt as bad before we lease. it was like a 640-660 when i got it. i could have financed it but the payments were higher. i negotiated it as a purchase first to get that residual down and then decided to lease it with the intention to purchase it before the lease was up.
i did have a few missed payments which screwed it up even more. now i think its sub 600. i have to get a credit report and check the real score.
ya i can check to see if i can co sign but i dont want to rely on that.
i did have a few missed payments which screwed it up even more. now i think its sub 600. i have to get a credit report and check the real score.
ya i can check to see if i can co sign but i dont want to rely on that.
11-23-2012, 05:17 PM
#37
Drifting
Thread Starter
OP....is your current lease through Acura Financial Services? If so, have you been paying your car on time? If so, regardless of credit, Honda and Acura treat even people with Tier 4 credit as Tier 1 so long as you pay your car on time. I work in the industry....stating fact here. Just keep making those payments on time and when you are close to the end of your term, you will get approved, at whatever the pre-owned rate is for Acura in the future 13-15 months from now. No worries my friend...just pay that car on time
11-23-2012, 08:14 PM
#38
Cruisin'
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We'll have to agree to disagree then. I've done it for my sister and I know others that have done it. Do you really think that AFS would rather sell a car at a loss at Manheim than sell it near retail to a customer? The dealer you worked must have not had interest in making money.
And you have no idea what Honda does with leases. I do. They purchase insurance to cover any loss at the lease end term when its originated for every lease they do. Honda doesn't lose....period. That is why they take the cars and don't negotiate. They get paid from the insurance company. You think they'll sell some haggler like yourself the car for under the purchase buyout when they get full value from the insurance? LOLLOLOLOLOL!!!! So right there, knowing what I know...I know you're full of shit, ceb.
Go look up all this stuff its all on the internet. They don't give a rats ass who you are....you turn the car in or buy it out at the contract price. It's been like that for a long, long time now. Search this very site there's a few threads about it. I know it's hard for some people to grasp that a car salesman is actually telling the truth on this matter...but it is true. I deal in absolutes and truths. Continue to deal in fantasy.
You probably think the US dollar is real.
11-23-2012, 08:18 PM
#39
Cruisin'
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Something that seems to have been overlooked here...If your credit is so bad, how'd you qualify for the leased TSX in the first place?
End of lease buy out MAY be negotiated through AFS or it can be "back doored" through the dealer accepting the return.
We were offered a lesser price through MB but, declined then the dealer offered us an even better deal when we returned it.
End of lease buy out MAY be negotiated through AFS or it can be "back doored" through the dealer accepting the return.
We were offered a lesser price through MB but, declined then the dealer offered us an even better deal when we returned it.
11-23-2012, 08:20 PM
#40
Cruisin'
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Just stay in contact with them. Explain it to them what happened. This will help when the lease term is up. Keep paying on time from here on out. Honda/Acura aren't soulless bastards...they'll make notes in their system on your reasons and explanations. It's much better than having no reasons for latenesses. It will help you down the road when you want to get this car or buy another Honda/Acura product.
Last edited by mjiCLS; 11-23-2012 at 08:25 PM.