Options for excess mileage on lease

[MrAnthonyC]

lots of good advice, thanks guys.

I was most interested in the cost difference between possibly getting the limit increased to 15k per year through contract negotiation (with increased per month payments of course) versus just paying for the extra miles at the end. Anyone know how that compares? ie paying for 15k miles per year results in 15c per mile, but paying for excess miles at the end of the contract is 20c per mile.

[MrAnthonyC]

Originally Posted by ZionsWrath

Unless you negotiate it out by leasing another car from them i doubt they will do any good will for you. That is why they make the contract.

Jesus, I feel like I haven't seen a post from you since i signed up in November back in the Sklimo days. Am I just not looking in the right places?

[Akrkwk310]

Originally Posted by MrAnthonyC

lots of good advice, thanks guys.

I was most interested in the cost difference between possibly getting the limit increased to 15k per year through contract negotiation (with increased per month payments of course) versus just paying for the extra miles at the end. Anyone know how that compares? ie paying for 15k miles per year results in 15c per mile, but paying for excess miles at the end of the contract is 20c per mile.

Hello maybe i can add some to your question as i have leased all my cars before and some what familiar with this

So its always better to sign up for 15k than paying .15 cents per mile for over miles.... Why? First of all, they will charge tax for the extra miles you have driven out of your contract so its gonna be actually more than 15 cents/ mile

Usually there are 2% residual value differences between 12k and 15k
So its about $500 difference based on assumption that the msrp of the car is $25k (FRS) If you divide $500/24month lease, thats about $20 more in mo pmt for 15k but if you drove 3000 miles over/year for 2 years( lease contract)
Thats total of 6000 miles x 0.15 + 9% tax = 981

So $500 < $981

The reason why i dont purchase cars is because i usually lease cars that are over 50k If i were to purchase the car i would pay $5000 just in sales tax Yes i do pay tax monthly for lease payment but its always a lot less than as if i were to pay sales tax off new car price, if i ever wanna buy a car after the lease, the tax is gonna be based on the residual value so i will pay so much less tax

[stugray]

Back when I was 12-15 my step-dad had me crack open the SpeedO and roll back the ODO on a few cars for that very reason. (some more than once)

Kind of hard to do that these days....

[MrAnthonyC]

Originally Posted by Akrkwk310

Hello maybe i can add some to your question as i have leased all my cars before and some what familiar with this

So its always better to sign up for 15k than paying .15 cents per mile for over miles.... Why? First of all, they will charge tax for the extra miles you have driven out of your contract so its gonna be actually more than 15 cents/ mile

Usually there are 2% residual value differences between 12k and 15k
So its about $500 difference based on assumption that the msrp of the car is $25k (FRS) If you divide $500/24month lease, thats about $20 more in mo pmt for 15k but if you drove 3000 miles over/year for 2 years( lease contract)
Thats total of 6000 miles x 0.15 + 9% tax = 981

So $500 < $981

The reason why i dont purchase cars is because i usually lease cars that are over 50k If i were to purchase the car i would pay $5000 just in sales tax Yes i do pay tax monthly for lease payment but its always a lot less than as if i were to pay sales tax off new car price, if i ever wanna buy a car after the lease, the tax is gonna be based on the residual value so i will pay so much less tax

This is the perfect answer. thank you, pal.

I guess i'll try and give the car a break a month out of each year so my charges arent too high.

[Dadhawk]

The other option I did not see specifically mentioned is buying the lease out now. You should be able to do that at any time, and it may, in the end, save you money if you are going to be well over on mileage.

Most car leases allow you to buy out at any time, you'll just have to pay more now than you would at the end of the lease.

[ntron1]

Originally Posted by Akrkwk310

Hello maybe i can add some to your question as i have leased all my cars before and some what familiar with this

So its always better to sign up for 15k than paying .15 cents per mile for over miles.... Why? First of all, they will charge tax for the extra miles you have driven out of your contract so its gonna be actually more than 15 cents/ mile

Usually there are 2% residual value differences between 12k and 15k
So its about $500 difference based on assumption that the msrp of the car is $25k (FRS) If you divide $500/24month lease, thats about $20 more in mo pmt for 15k but if you drove 3000 miles over/year for 2 years( lease contract)
Thats total of 6000 miles x 0.15 + 9% tax = 981

So $500 < $981

The reason why i dont purchase cars is because i usually lease cars that are over 50k If i were to purchase the car i would pay $5000 just in sales tax Yes i do pay tax monthly for lease payment but its always a lot less than as if i were to pay sales tax off new car price, if i ever wanna buy a car after the lease, the tax is gonna be based on the residual value so i will pay so much less tax

Interesting....In PA, the lease is taxed @ 9% which is added to the lease payment. The sales tax is 6% so leasing requires a higher tax burden.

YMMV.

[Akrkwk310]

Originally Posted by ntron1

Interesting....In PA, the lease is taxed @ 9% which is added to the lease payment. The sales tax is 6% so leasing requires a higher tax burden.

YMMV.

Ohh i see thats interesting to know, in CA you are taxed the same at 9% whether you lease or purchase

[3nl]

For my 36mo lease the difference was around $13/mo to bump up to 15k - which equates to a little over 5 cents per mile. WAY cheaper than paying 20 cents per mile in penalties.

Either renegotiate or buy the car outright at the end then sell it - you will lose less money by selling it yourself most likely.

[ntron1]

Originally Posted by Akrkwk310

Ohh i see thats interesting to know, in CA you are taxed the same at 9% whether you lease or purchase

Yes but Cali is run by communists.....lol

[Canadian Greg]

Most dealers charge about 7-10 cent per kilometer over the limit.
It can add up in a hurry.