End of lease purchase question

[Dustin Jackson]

Sorry for the off topic question but I need some wisdom here. This is in California

I am coming to the end of the lease on my 2020 Honda Civic so I called a local credit union and got approved for the purchase amount.

I called The Honda stealership where I got the car and they said I need to schedule an appointment to have the car inspected and pay $200 for this inspection. This $200 inspection fee isn't on the lease paperwork and it isn't required by Honda Financial Services who is the entity who owns the lease.

It seems this is happening because my local credit union can only purchase this car through this CUDL system (?) instead of sending a check to Honda Financial Services.

Anyways, the dealership is trying to charge me a $200 inspection fee for a car I already have. Is there a better way to navigate this situation or do I need to fork up more money for this car I already have?

 

[wjburken]

Sorry for the off topic question but I need some wisdom here. This is in California

I am coming to the end of the lease on my 2020 Honda Civic so I called a local credit union and got approved for the purchase amount.

I called The Honda stealership where I got the car and they said I need to schedule an appointment to have the car inspected and pay $200 for this inspection. This $200 inspection fee isn't on the lease paperwork and it isn't required by Honda Financial Services who is the entity who owns the lease.

It seems this is happening because my local credit union can only purchase this car through this CUDL system (?) instead of sending a check to Honda Financial Services.

Anyways, the dealership is trying to charge me a $200 inspection fee for a car I already have. Is there a better way to navigate this situation or do I need to fork up more money for this car I already have?

I’d check and see if you need to take it back to that dealership or any Honda Dealership. Check with other Honda dealerships and see what they say.

 

[Fless]

It's not clear to me if your CU would finance your outright purchase of a previously-leased vehicle. I would think it fairly restrictive if they would finance purchases only through certain dealers. Now, I know that they usually have purchasing agreements that allow members to buy from certain dealers, but I doubt that's a restricted relationship. I could be wrong (and I'd be changing CUs if that were the case).

I'd say go to the CU and ask some pointed questions. For one, why the $200 charge from the "required" dealer and would the CU get the dealer to waive that fee, since the CU apparently has some sort of agreement with that dealer? Or, am I able to purchase this auto without the "mother, may I" restrictions? How?

 

[Dustin Jackson]

@Fless After a few phone calls it sounds like CU #1 doesn't do "Lease Buyouts" so to finance through CU #1 the dealership would have to "sell" me my car again and that is why I would need to go to the dealership.

I called CU #2 and told them my intentions of getting an auto loan, sending the honda financial services (leasing company) a check in the mail and avoiding the dealership altogether. CU #2 said that they do "lease buyouts" so I think I am going to be ok by going with the new credit union although the rate is higher.

The $200 dealer inspection seems like a legal scam they can do to squeeze some more money out of people, I have a bad history with this particular dealership so I'll die before I give them another dollar of mine.

 

[Joseph Garcia]

I've had one or more often two Hondas continuously since 1975, and I've paid off the lease on some of them (through a CU) here in NH, and the dealer has never requested an inspection or had any other active role in the transaction. I think that your dealership just wants to make some easy money.

 

[petethepug]

what ended up happening with the Honda lease buy out?

 

[Dustin Jackson]

@petethepug The preferred credit unit doesn’t do “lease buyouts” so they wanted me to jump through a bunch of hoops to complete the purchase.

In the end it was easier to go with a less preferred credit union that DOES “lease buyouts” and then refinance it with my preferred credit union.

It seems the dealership was just trying to get some easy money out of me.

 

[OR VietVet]

@petethepug The preferred credit unit doesn’t do “lease buyouts” so they wanted me to jump through a bunch of hoops to complete the purchase.

In the end it was easier to go with a less preferred credit union that DOES “lease buyouts” and then refinance it with my preferred credit union.

It seems the dealership was just trying to get some easy money out of me.

Hence the name STEALERSHIP.

 

[petethepug]

Whoa … that’s shady. Glad you found a work around to their shenanigans. Obviously your Honda has some residual value worth the efforts they made to get it back.

When you get the right credit union behind you life is good.

 

[Dustin Jackson]

@petethepug I agree. The only downside to what I did is I need to wait for the car registration to reflect the current credit union before my preferred credit union will refinance it but the plus side is... **** that dealership.

 

[Joseph Garcia]

My wife is now in the process of buying out her lease on the 2020 Honda HRV. She is awaiting approval from the CU, and once received, she will advise the Lessor, Honda Leasing, of her decision, and Honda will generate the appropriate paperwork to complete the transaction. No dealer visits, inspections, etc. will be required.

 

[Dustin Jackson]

@Joseph Garcia I understand that's the lease buyout process.

To buy my leased car without doing a lease buyout I had the option to go to the dealership where they would "sell" me my car as a fresh transaction in which I would have to jump through all those hoops including inspection.

 

[Joseph Garcia]

@Joseph Garcia I understand that's the lease buyout process.

To buy my leased car without doing a lease buyout I had the option to go to the dealership where they would "sell" me my car as a fresh transaction in which I would have to jump through all those hoops including inspection.

Thank you for the clarification. I cannot see any advantage to taking that option, especially if you actual mileage is less than the lease contract's maximum mileage.

 

[Dustin Jackson]

@Joseph Garcia I'm a young guy and pretty understanding of most situations but the thought of re-buying a car that I've "owned" for the last 3 years really pissed me off. It helped me understand old mans frustrations with modern stupidity.

The lease buyout is really the way to go, I don't understand why my preferred credit union stopped doing lease buyouts.

 

[OR VietVet]

@Joseph Garcia I'm a young guy and pretty understanding of most situations but the thought of re-buying a car that I've "owned" for the last 3 years really pissed me off. It helped me understand old mans frustrations with modern stupidity.

The lease buyout is really the way to go, I don't understand why my preferred credit union stopped doing lease buyouts.

You have to realize, in their minds, you have rented/leased and not owned for 3 years. You would be buying a used vehicle and they want to charge you all the fees they can come up with.

 

[Joseph Garcia]

@Joseph Garcia I'm a young guy and pretty understanding of most situations but the thought of re-buying a car that I've "owned" for the last 3 years really pissed me off. It helped me understand old mans frustrations with modern stupidity.

The lease buyout is really the way to go, I don't understand why my preferred credit union stopped doing lease buyouts.

I would suggest that you engage another credit union for the lease buyout. I did this on one vehicle several years ago, not because my preferred credit union did not do lease buyouts, but rather because another credit union offered a better interest rate on the loan.

 

[Dustin Jackson]

@Joseph Garcia My preferred credit union has the best interest rates in the area but they don't do lease buyouts. Today I sign paperwork to refinance the car with my preferred credit union so all will be well after today.