zepharus

I was curious how trading in a lease works. My wife leased a 2012 Q5 Premium plus (with advance key option) and it now has 13000/miles.

She is adamant that she can trade in a lease and she will make money on it. I am not so sure. I know she got a good price on the car and put down the Tax also.

Thoughts?

03EX

Just like a purchase, and depending on your state you could be eligible for a tax credit as well.

zepharus

NY and how so on the tax credit?

uberwgn

Is the lease over now? If so, the residual value = your purchase price


Compare your purchase price against current FMV of the Q5 in your area. I know these vehicles are coming off-lease with low residuals making it entirely possible to have some built up equity. You may have to arm wrestle the dealership to truly capture what you're due

cheewy

I too am from NY and have been contemplating on trading in my 12 Q5 3.2 S-Line Plus fully loaded and found out that there is no tax credit for leased vehicles. As far as appraisals go, get a few quotes from different dealers. If you're ending your lease early, you may have equity. In my case, I would be ending it early, and I have equity to apply towards the new vehicle. Keep in mind trading in for another Audi vs another brand results in a different buyout or payoff. Audi dealers do not have to pay taxes when taking in your current Audi.

DennisMitchell

I am in NY. When you and your dealer agree to trade-in your leased vehicle, the dealer is purchasing the vehicle from the lessor through assignment from you at the residual buyout in your lease agreement (exercising your lessee right). The dealer will then sell or wholesale the vehicle. No different than the trading in of your owned used car. The trade-in value is offset against your purchase before sales taxes are paid. You save sales taxes.

Dealers don't pay sales tax, they resell. You pay sales taxes on your net purchase or lease payments. You will not get back sales taxes paid in advance on a lease should you turn in your vehicle early. But you are getting higher FMV for the vehicle if you do trade-in early minus the residual buyout of the vehicle.

Hope this helps.

Dennis

DennisMitchell

Most certainly this will work out favorable for you. Get a trade-in quote from Autotrader.com , and a used car valuation from Edmunds.com My experience is that the two trade-in quotes will be close.

That is the amount minus lease buyout fee, title fees, any remaining lease payments and the buyout residual, equals your equity value.

Make your best deal on the new car purchase, then you want the above as a reduction of the new car price. The dealer will try to reduce the amount of the trade-in but hold strong. If the car is to be ordered, then the trade-in value will go down about $400 a month until delivery.

Best of luck,
Dennis