Regarding the vehicle lease renewal programs?
Forget Dukie there! Apparently things in the UK are different or he is completely off base. Here is the real scoop in the US. I assume with a Jeep Liberty that you leased through Chrysler Credit. This is the best time to begin looking, 3 months before your lease expires. When your residual was calculated, I am sure CCC allowed themselves margin in the market. They are not in the business to lose money. You said you are under mileage which is definitely in your favor. Unfortunately, the bottom has dropped on SUV’s because of gas prices, so what your vehicle is worth v. what they planned for maybe two different things. Here’s what to do: Find out what the “wholesale” value of your vehicle really is. Ask them directly what they are offering you in cash against your lease for your Liberty. Shop this against a couple of dealers. If your “wholesale” value is worth more than your residual, or lease buyout, trade early, if it is less, let the lease expire, then go after your next vehicle. It i
I’ll give you an example of leasing and how they make money: You see a car for £60000 in the BMW garage. You go to buy it. They have a deal with the finance company and through them they offer you a lease. They have certain lease rates given by the finance company they use and then they add their own profit on top. Let’s say you say ‘I can afford £2000 a month, what can I get?’ They offer you a deal on a certain car and present you with an offer of £2000 oer month. This means you lease a car for £60000 for 60 months (5 years) for example. They charge interest in %. So instead of you paying 60 installments of £1000 per month, you pay £2000 per month for example, and overall you pay back £120,000. So they make £60,000. Some of which goes to them, some to the finance company. So, you have gone in the garage, chosen your car and filled out the finance company’s forms. BMW dealer then applies to the finance company who checks you out and say ‘yeah, her credit history is good, she’s good for
