Lease trade in

[smilepak]

My lease with US Bank will end in July. One of the option on their letter is trade in.

Anyone done this? How does it work?

If I order a new MS and take the leased vehicle to Tesla as a trade in, is it essentially Tesla paying the residual value to US Bank and I buy the new vehicle at normal full price?

 

[shanelord]

I'm from Australia so not up to date on US financial leases, but if the basics remain the same then yes, Tesla pays the residual.

To expand on that; ultimately Tesla will offer you a trade-in valuation on your car - you then obtain a residual pay-out letter from US Bank, and if the trade value from Tesla is equal or positive against your residual balance, Tesla will pay the outstanding residual amount to US Bank. If any left over (ie trade is worth more than residual) then you either choose to get a cheque for the remainder or put it against the new car.

Thanks,
Shane.

 

[smilepak]

Thanks. I guess I’ll end up keeping my model S at the end of the lease. Paying 53k residual to keep the 70D vs paying 80k+ for a new 75D

 

[shanelord]

Thanks. I guess I’ll end up keeping my model S at the end of the lease. Paying 53k residual to keep the 70D vs paying 80k+ for a new 75D

I'd recommend at least gauging your options. Get a pay out figure from US Bank and get a trade in estimate from Tesla. You can then at least look at the finances.

Not always the case, but I've been surprised with some past cars and had quite a considerable amount in positive $ left over after the payout - leaving me in a very good situation. You may also be able to get a CPO 85D or 90D for similar to the new 75D if you're lucky (check sites like https://www.teslainventory.com/).

Shane.

 

[smilepak]

To get a trade in estimate with Tesla, do I just bring it in to the SC and have them do an estimate?

 

[P85_DA]

Not sure I understand there is no trade in..you turn in your lease and pay any mileage overages. You can than lease or buy new car ..the only negative you could have is mileage overage ..no need for trade in quote

 

[smilepak]

Not sure I understand there is no trade in..you turn in your lease and pay any mileage overages. You can than lease or buy new car ..the only negative you could have is mileage overage ..no need for trade in quote

You are correct. At the end of the lease you have the option to turn in the lease or buy it at residual value. However, how I understood it and I could be wrong is you can take it to Tesla at the end of the lease to purchase an another vehicle. Tesla can have the option to buy the vehicle from the bank and give you an offer. The offer can be higher or lower than the residual value you have specified on the lease. If it is higher, then you net positive towards a different vehicle.

 

[P85_DA]

Ok I haven’t heard of Tesla offering a value other than residual ..reason is im about to turn in a lease and that wasn’t offered. Basically if my residual is more than what I can buy an existing P85D(my case) I will turn in ...if resell is higher than that than I can buy and theoretically resell ..however leases never work that way

 

[RScottyL]

My lease with US Bank will end in July. One of the option on their letter is trade in.

Anyone done this? How does it work?

If I order a new MS and take the leased vehicle to Tesla as a trade in, is it essentially Tesla paying the residual value to US Bank and I buy the new vehicle at normal full price?

Not sure how Tesla does it, but normally when you lease a car, you have a couple of options at the end:

(1) Trade in the vehicle for a new one. Usually, when you do this, they will appraise the car, and see what your payoff is.

(2) Purchase the vehicle - You can see what your payoff is, and purchase it for that amount. You would need to get financing for that amount. You could check to see if the car is worth more or less than your payoff. If more, then this is a good option. If not, you may want to do option #1 and start a new lease!

(3) Turn in the lease! Usually just go there, let them inspect the vehicle to make sure you are within the mileage and damage limits of the lease. If so, just give them the keys and walk away!

 

[Richt]

That’s super interesting. I’ve not leased a car before this MX and an unexpectedly loving it way more Than I thought.

So wondering now whether to keep it when the lease ends. It’s nice to be the only owner. Any ideas how the math generally works out?
If I’m going to keep then would want to keep way cleaner (body protection) than I would if sending it back.

 

[P85_DA]

It generally will cost u more to keep after the lease ...if early enough in your lease you may be able to trade in for purchase of new or work with Tesla on purchasing now I’m not sure if you will get the tax credit on purchasing existing that’s why sometimes math works better to trade in and purchase new and get tax credit

 

[BIG ACH]

Why are you not considering turning in the lease and then going and leasing a newer model? I mean isn't that the objective with leasing cars?

In general - buying a car you had just been leasing is typically the most expensive option. But it does happen often, some people just really like the car they have.

 

[redy]

That’s super interesting. I’ve not leased a car before this MX and an unexpectedly loving it way more Than I thought.

So wondering now whether to keep it when the lease ends. It’s nice to be the only owner. Any ideas how the math generally works out?
If I’m going to keep then would want to keep way cleaner (body protection) than I would if sending it back.

Return it and get a new one.

You have already paid a lot of interest in that lease. I was gonna say just give it back and get new one. You have to actually do the math. How much you have paid and how much you still have to pay to own it. If that total is more than price of a new one, obviously go for a new one with new MCU. And also if your current X is a 75D, 100D might be another reason to get a new one.

 

[Richt]

That's make sense. Will do the math when we get there, but you are right, the original reason we leased (both this one and our Bolt) was because technology was moving fast, both are coming out of their leases in 2019/2020, so that's a good time.

The cars we really want are the Model 3 (Performance!) and the Model Y, so probably makes sense to wait to do the math and then to look then. Thanks for the advice!

Return it and get a new one.

You have already paid a lot of interest in that lease. I was gonna say just give it back and get new one. You have to actually do the math. How much you have paid and how much you still have to pay to own it. If that total is more than price of a new one, obviously go for a new one with new MCU. And also if your current X is a 75D, 100D might be another reason to get a new one.

 

[smilepak]

A few things I've gathered and why I went with lease. I went with a lease in 2015 was due to the fact I was unsure whether or not I like the Tesla and unsure of the Tesla technology.

At the end of the lease, my residual value is approx 52k for a 70D. If I turn it in and get a CPO of something similar or better, you are looking to spend at least 65k. For an additional of 10k+ price range, would the extra 30 miles and maybe better stereo worth it. The 85 is around 63k- 65k 2014/2015 model. For the most part, it is almost identical to what I have. Except I have AP already activated.

The unknown is the reliability of the CPO whereas the one I own know, I know the vehicle. I maintain it well, I have annual maintenance on it, and kept the interior well. The CPO is a hit or miss.

So I might end up keeping mine.

 

[Richt]

Great point smilepak, That is what I was thinking, moving to another CPO or even a new car. I've also heard the MX and MS might have a redesign (M3 like styling? higher capacity), so it seems like the smart thing is to take care of the leased car and see how things look next year. Thanks all![

QUOTE="smilepak, post: 2774718, member: 35582"]A few things I've gathered and why I went with lease. I went with a lease in 2015 was due to the fact I was unsure whether or not I like the Tesla and unsure of the Tesla technology.

At the end of the lease, my residual value is approx 52k for a 70D. If I turn it in and get a CPO of something similar or better, you are looking to spend at least 65k. For an additional of 10k+ price range, would the extra 30 miles and maybe better stereo worth it. The 85 is around 63k- 65k 2014/2015 model. For the most part, it is almost identical to what I have. Except I have AP already activated.

The unknown is the reliability of the CPO whereas the one I own know, I know the vehicle. I maintain it well, I have annual maintenance on it, and kept the interior well. The CPO is a hit or miss.

So I might end up keeping mine.[/QUOTE]