Saturn Last Lease Payment ... Now What Happens?


#1

This is not my car. I’ve never leased and probably never will. It’s an 85-year-old WWII friend from church.



He leased a 2007 Vue for 4 years. It’s got a 2.2 4-cylinder engine, FWD, power seat, sunroof, AC, power locks, etc. I think this is considered a ‘standard’ Vue.



He’s only put 12,000 miles on it.



No accidents, no issues. His last payment is soon. He needs to make a decision by the end of March.



He pays $335/month, so he’ll have $16,000+ into it after his last payment.



It looks like he’s going to try to buy it, but doesn’t know how to do it.



Here’s what I’m thinking - tell me if I’m wrong: If he had bought it outright in 2007, he would’ve paid about $22,000 for it (he doesn’t have the original window sticker, but thinks this is the number on his paperwork). His “buy” number will be $22,000 - $16,000+ plus interest.



He thinks it’s going to be something like $8,000 (which, to me, seems high).



1.) Could it be that the $8,000 number was pre-determined at the time he signed the lease?



2.) Is the $8,000 number negotiable? Let’s say ZERO percent financing was available at the time he signed the lease … and he has perfect credit … could this make the $6000 purchase price possible?



3.) Given that he’s only put $12,000 miles on the car, Edmunds says this Vue could be worth $12,000 retail. So the dealer (or Ally … who bought GMAC and who he says he makes payments to) knows that if he walks away from the car, they could possibly end up with $28,000 for a $22,000 vehicle!



Like I said, I’ve never leased, so maybe I’ve got this all wrong…


#2

Your friend needs to dig out the lease papers he signed when he took delivery of the car. Most likely it gives the buy out amount in the original contract. I think your figures are flawed and his buy out would be higher than $8,000.

The problem with leases is the buyouts really don’t reflect current market value of the car. In this case my guess is the buyout is going to be higher than the market value. Meaning he should let this car go at the end of the lease.


#3

Can you read the original lease agreement?

That might answer some of your questions.

Otherwise, as a former car salesperson, I’d say EVERYTHING is negotiable.

But your friend may not be able to do the necessary negotiating himself. It’s not going to be easy, or fun.


#4
  1. The selling price may have been predetermined. A dealer would sell this truck for at least $10,000 on his lot; almost $12,000 with the low mileage. Fortunately, he won’t be charged for the low mileage on the back end. $8000 is a great price. But it only is a real price if it is in the contract.

  2. Anything is negotiable, but with only 12,000 miles on it, the dealer would probably like to sell it on his lot. They might not budge on the price. All you friend can do is try.

  3. The money he spent up to this point doesn’t matter. If he can get a $12,000 Vue for $8000, he is making a great deal.


#5

The dealer will make a purchase offer typically a little less than the fair market value. How much less is the question. I doubt they will go to $8,000 if fair market value is $12,000.

This is the ideal reason leases are a bad idea. A business can write off leases as business expenses. A person with a lease is simply renting a car for an extended period of time. The dealer gets paid for the depreciation plus interest. In this case, the dealer wins big.


#6

Your friend is below the mileage maximum, good news for the dealer (which no longer exists) if he let’s go of the car.
Even thought the Saturn is no longer manufactured, they held their value very well, and tend to last well over 150,000 miles if maintained. Many much older Saturns are still on the road, and the cost of ownership is low. Recent model years will be able to get parts for years to come.
You need to find the original lease agreement. Chances are the lease was transferred to a local GM dealership when Saturn folded a few years ago. If not, contact GM with the car’s VIN to get help finding the original agreement.
If I know my octogenarians, chances your friend’s copy of the lease is in a leather folder in the glove box, or in a file in his home. You don’t get to your eighties with perfect credit if you don’t keep all important records and live according to a routine.
The lease agreement should provide all of the relevant information. A buyout option at the end of the lease is pretty standard, and should have a fixed cost. $8,000 does not sound that high. Put it in perspective. He can’t buy his car on the market for $8,000.

I’d find the lease agreement and see what options are available. It is a contract. It might be best to have a contract lawyer review it.

Or it might just be best to find the dealer that now holds the lease and see if they can’t do the right thing by an octogenarian WWII veteran. Imagine the bad press if they screwed him and you as his friend decided to make an issue of a local business putting the screws to a WWII veteran.


#7

Yeah, I’ll have to ask to see the lease agreement. I think he’ll show it to me. I only know him because he goes to my church and he grocery shops when I do, so we’d see each other and say “hi”, and now we talk every time we cross paths. He’s a real nice guy.

The more I think about it, maybe he’s right about the $8,000+ number. That would mean he’d end up with $24,000+ into the vehicle to own it - which is probably where he would’ve been anyway had he bought it outright for MSRP plus a good interest rate on a loan. IIRC, Saturns typically sold near or at full MSRP, right?

If you’re correct and he has to pay $12000+ for the car, then that’s criminal.


#8

I would try and buy the vehicle BEFORE the dealer (probably a Chevy dealer or whoever holds the lease and title to the car) finds out it only has 12,000 miles on it…Your friend has paid for 35,000 miles he has not used…Unless the contract specifies an end of lease buy price, they will continue screwing him like they did by leasing the car to begin with and demand a premium price for their low mileage geezer mobile…


#9

I’m going to ask to see the agreement.

And, you’re right - he’s a fairly nimble mid-80’s guy (still working full-time, too), but he’s too nice and I’m sure they’ll screw him over. He had ONE problem with the Vue (last year) - lost his A/C after driving through a puddle on a main drag in town. Since the Saturn dealer was already closed down at that time, he took it to the GMC dealer who promptly billed him $700 !!! When he told me about this at the grocery store, I went in and took a look at the “damage” for myself, after which I was able to negotiate the bill down to a more reasonable number ($160). He was estatic! He never would’ve done that on his own. He could definitely use some help with this deal…


#10

I just hope he’s right about that $8,000+ number. If he is, then I agree - it’s probably a decent deal for him.

But I wouldn’t say he’s getting a $12,000 Vue for $8,000. I’d say it took him four years to own a $22,000 Vue for $24,000+.


#11

Your friend has either an open end lease or a closed end lease.

An open end lease allows the option of purchasing the vehicle at the end of the lease with all it’s scars. A closed end lease means you surrender the vehicle back to the leasing company with no option to purchase. But you pay for excess damage or mileage at the end of the lease.

Tester


#12

Let’s hope he’s right about that $8,000+ number.


#13

You really need to read over the paperwork on this and it’s entirely possible that this elderly gentleman could have been taken to the cleaners on this deal.

As a side story to this, you might consider the tale from an interesting book I’ve got in my junk somewhere. This book was written by a long time car salesman, sales manager, and F & I guy and part of it was amusing in a way.

This salesman had the ability to read people quickly and would take a quick look at their trade-in (also going through the glove box, etc.) while throwing a bunch of seeming random questions and comments around. In this short length of time he would determine religious and political leanings, hobbies, etc, etc.
He would then excuse himself to “check on the bottom line price”. The customer was then invited into the office.

During those excused minutes the salesman would root through a number of file cabinets he had with all types of bric-a-brac that was catalogued alphabetically.
The potential buyer was Catholic? The salesman would prop up a pic of the Pope.
The buyer was a Democrat or Republican? A pic of the last President of that party was prominently displayed on the wall.
The buyer likes to hunt and fish? The salesman would have a framed pic of a recently shot pheasant or a “I’d rather be fishin” sign prominently displayed.
Elderly couple? There were always a few pics of some young kids around although whose kids they were is anybodys’ guess as they were all file photos.

He also stated that catering to the elderly was much easier and this kind of thing made a huge difference in how the salesman and the deal was perceived.
I don’t know if they went quite this far here but you get the point. :slight_smile:


#14

Hate this site. That’s TWO posts now that disappeared into thin air !!! Why don’t they fix that problem. It’s only been, what - 5 years ???

What I had said was I’m sure he has the paperwork. He’s still working full-time and taking care of his sickly wife of 50 years, so he’s still got it together.

But he seems to think he’s going to be dealing with Ally bank on this lease, but I don’t think he’s right about that. One of the two surviving GM dealerships in town is probably holding the paperwork right now. If it’s the one that tried to take him for a ride on that A/C fix, that doesn’t bode well because while I was able to negotiate that bill down to $160 (from almost $700), maybe it was made possible by them knowing they’d get him in the end anyway…


#15

THIRD ATTEMPT !!

Hate this site. That’s TWO posts now that disappeared into thin air !!! Why don’t they fix that problem. It’s only been, what - 5 years ???

What I had said was I’m sure he has the paperwork. He’s still working full-time and taking care of his sickly wife of 50 years, so he’s still got it together.

But he seems to think he’s going to be dealing with Ally bank on this lease, but I don’t think he’s right about that. One of the two surviving GM dealerships in town is probably holding the paperwork right now. If it’s the one that tried to take him for a ride on that A/C fix, that doesn’t bode well because while I was able to negotiate that bill down to $160 (from almost $700), maybe it was made possible by them knowing they’d get him in the end anyway…


#16

How can you do that? And like I said above, if the GMC dealer is holding the lease, they pretty much KNOW what the mileage is because they very likely recorded it when he went through the A/C fiasco with them.

Maybe he can settle with Ally bank? That’s who he thinks he’s going to be dealing with - probably because they’ve been contacting him about the deadline coming up…


#17

Tester:

Sounds like it’s an open-end lease because someone has been contacting him about making a decision soon. But I’ll have to look at the lease for myself (if he’s OK with that)…


#18

ok4450:

Yeah, this man is such a nice guy … really. I’m from New England originally. He’s from the Chicago area (where my brother’s been living now for 20 years - so there’s a connection there). He’s Polish … reminds me a LOT of my Polish fireman neighbor “Mickey” growing up (who was a dead-ringer for Eddie Albert of Green Acres). Another connection. Mickey was a really good guy, too. Didn’t have much, but always a smile and a funny line or two. When I bought my first brand new car in ‘89 and was out in the street washing and waxing it, he yelled over to me (with his classic dead-panned look), “…hey matthew … that 'aint gonna make it run any better…”. He died of cancer in ‘96, a year after I moved to the South. Startin’ to tear up just typing this right now. You know, my parents’ generation (of which this man is a menber) was the last of the Mohicans, I think. Depression-era kids, tough up-bringing, had to work for everything they got … nothing really handed to them, probably some of the highest character people still with us. I think a LOT of them are optimistic types, always see the good in people, but unfortunately they’re dealing with a new breed of Americans who are greedy, lower-character people who just want the money any way they can get it.

So yeah, he might be in trouble here, but I’ll have to read the lease agreement to be sure.


#19

As mentioned, someone has to read the papers before driving in the lot so they can not figure out the 12K mile situation. I believe he could have the leasing company send/fax a copy. The residual value would be written on there. With the AC repair story I would say he should not go in the arena all by himself. Even my very savvy businessman friend drags someone with him for lease return.


#20

Now you know why, for an individual, leasing a car is usually the most expensive way of having a car. In any case, someone needs to read the actual paperwork from the original lease and any possible amendments.