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Volkswagen lease? Never again (1 Viewer)

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NeverEnough

NeverEnough

Footballguy
Got a good offer from Carmax for my 2017 Jetta so went back to sell it to them yesterday. I already had all the payoff info from VWC. Carmax needed VWC to verify. Carmax calls & VWC faxes over a letter with a payoff $1,800 higher than what I was told.

I call and they tell me call the dealer I bought the car from after talking with 3 or 4 different people that didn't know anything & told me it was b/c Carmax has to pay tax since it's not me paying it off then I'm told Carmax has to buy it for FMV.

Call dealer & talk to finance guy. He said that $1,800 higher price is wrong, but doesn't know what $ is right & also says they are probably asking for FMV.

WTF?! The payoff is the payoff, it doesn't matter who is mailing you the damn check! I'm going to call VWC again today & fight some more, but looks like they are screwing me into keeping this car until I sell it privately. I have good friends that were in the car business for many years & even they say this is bs & wrong.

UPDATE:

So I just had a good friend that was in the car business for many years call VWC & they are essentially trapping lease clients in their cars. They told him when you try to sell the car to a dealership, VW Financial exercises their actual ownership of the vehicle. As such, they want the dealer to pay "fair market value", which has nothing to do with what I owe on it.

I will never do business with VW Financial again

 
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If you're ending a lease with say Ford and getting another Ford from the same dealer; it's a piece of cake and they'll usually waive any fees (mileage overage, etc.).

If you're ending a lease with say Ford and getting a Toyota - expect to get hit with every possible fee. 

They all do this.  It's not just VW.

 
Arizona Ron said:
If you're ending a lease with say Ford and getting another Ford from the same dealer; it's a piece of cake and they'll usually waive any fees (mileage overage, etc.).

If you're ending a lease with say Ford and getting a Toyota - expect to get hit with every possible fee. 

They all do this.  It's not just VW.
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Again, I've leased cars before & never had a problem. This is VWC, not a lease issue.

 
So I just had a good friend that was in the car business for many years call VWC & they are essentially trapping lease clients in their cars. They told him when you try to sell the car to a dealership, VW Financial exercises their actual ownership of the vehicle. As such, they want the dealer to pay "fair market value", which has nothing to do with what I owe on it.

I will never do business with VW Financial again

 
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I bet Drake doesn't lease from VW.

Had hit records on my demo
Did y'all boys not get the memo
I do not stay at the Intercontinental
And anything I got is not a rental, I own that motha####a

:mellow:

 
GroveDiesel said:
What do the terms say on the lease agreement that you signed?
Click to expand...


NeverEnough said:
So I just had a good friend that was in the car business for many years call VWC & they are essentially trapping lease clients in their cars. They told him when you try to sell the car to a dealership, VW Financial exercises their actual ownership of the vehicle. As such, they want the dealer to pay "fair market value", which has nothing to do with what I owe on it.

I will never do business with VW Financial again
Click to expand...

 
eoMMan said:
Leases seem complicated and annoying.
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Agree wholeheartedly. I’ve either bought new or used my entire life. I don’t know anything about leases and I don’t want to buy something more than I can truly afford. I also try and due all my due diligence so I get the right car each time. If I can’t see myself keeping it past the loan payment then I probably shouldn’t get it. It’s extremely satisfying have a car you own outright and aren’t paying for anymore. I also sell my own cars so I am not getting dicked multiple times by dealers. F that. 

 
stbugs said:
Agree wholeheartedly. I’ve either bought new or used my entire life. I don’t know anything about leases
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You know nothing about them so I stopped reading there. They work for some of us. Not for you? Not a problem. I've leased a few cars. Never a problem....until VWC. Now I know never to do business with VW Financial. I'm on hold to pay the car off myself. Once title comes in, I'll sell it to Carmax & put my $ back in the bank. #### VW.

 
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NeverEnough said:
You know nothing about them so I stopped reading there. They work for some of us. Not for you? Not a problem. I've leased a few cars. Never a problem....until VWC. Now I know never to do business with VW Financial. I'm on hold to pay the car off myself. Once title comes in, I'll sell it to Carmax & put my $ back in the bank. #### VW.
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Doesn't really seem like it's working well for you today.  Seems like a pain.

 
NeverEnough said:
You know nothing about them so I stopped reading there. They work for some of us. Not for you? Not a problem. I've leased a few cars. Never a problem....until VWC. Now I know never to do business with VW Financial. I'm on hold to pay the car off myself. Once title comes in, I'll sell it to Carmax & put my $ back in the bank. #### VW.
Click to expand...
Dealer lease financing is riskier than open end option leases from 3rd parties. What you are saying here is that you wished you had an open ended lease. 

Dealers arent in the business of offering that and usually heavily incentivize close ended leases to make the deal. 

If you just want to get a new 3 series every 3 years then closed ended are great. 

 
culdeus said:
Dealer lease financing is riskier than open end option leases from 3rd parties. What you are saying here is that you wished you had an open ended lease. 

Dealers arent in the business of offering that and usually heavily incentivize close ended leases to make the deal. 

If you just want to get a new 3 series every 3 years then closed ended are great. 
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One last time, I have leased vehicles before & never had an issue. This is a VW problem, not a lease problem.

 
Let's say I pay off the car today. They mail the title to me, in my name, & then the day I get the title I sell the car to Carmax. It's already registered in my name. So why do I need to pay tax in this scenario?

 
NeverEnough said:
Let's say I pay off the car today. They mail the title to me, in my name, & then the day I get the title I sell the car to Carmax. It's already registered in my name. So why do I need to pay tax in this scenario?
Click to expand...
Isn't it in the leasing company's name now?  Tax would be charged when you change the name on the title from the leasing company to you?

 
NeverEnough said:
Let's say I pay off the car today. They mail the title to me, in my name, & then the day I get the title I sell the car to Carmax. It's already registered in my name. So why do I need to pay tax in this scenario?
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The car is currently in the leasing company's name.  You're just renting it.  In my state, you buying it from the leasing company (thus, getting in your name) is taxable.  

 
NeverEnough said:
The dealers I bought them through.
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Are you sure they were not 3rd party leasing agents?  Not all dealer networks have an internal finance arm.  They may front a 3rd party as well. 

Not to put too fine a point on it, but it seems like you aren't super informed about what you signed on to.  What you describe here is typical for a dealer financing solution.  

 
The $1800 being sales tax is defensible.  You would owe sales tax on the buyout price, so Carmax owing it makes sense.  Adding $1800 to current residual value, though, is BS.

 
I'm confused about Carmax having to pay sales tax.  If you own a car and trade it into a dealership who, in turn, sells it someone else, the only party paying sales tax should be the end buyer.  The dealership and the end buyer aren't both paying sales tax.  I don't understand why it's different in this case case since the car leased.

 
Juxtatarot said:
I'm confused about Carmax having to pay sales tax.  If you own a car and trade it into a dealership who, in turn, sells it someone else, the only party paying sales tax should be the end buyer.  The dealership and the end buyer aren't both paying sales tax.  I don't understand why it's different in this case case since the car leased.
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I'm in CA and the state definitely double dips.  They call it "use tax" rather than sales tax, but the use tax not-so-coincidentally matches the sales tax rate.

 
NeverEnough said:
Let's say I pay off the car today. They mail the title to me, in my name, & then the day I get the title I sell the car to Carmax. It's already registered in my name. So why do I need to pay tax in this scenario?
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You are only paying tax on the portion you use during a lease. Normally it is added to the payment each month. You have not yet paid tax on the residual. 

 
Nugget said:
You are only paying tax on the portion you use during a lease. Normally it is added to the payment each month. You have not yet paid tax on the residual. 
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This I know. Not what I was saying, but anyway...

I'm paying the car off myself then I'll sell it to carmax. #### you VW

 
NeverEnough said:
This I know. Not what I was saying, but anyway...

I'm paying the car off myself then I'll sell it to carmax. #### you VW
Click to expand...
So will you be paying sales tax on the buyout value and if so, how much?

I'm curious if the sales tax is $1800.  If so, I bet that was factored into the VW quote to Carmax and Carmax didn't want to get stuck paying it.  By you buying the car from VW, you take care of that problem for them.  Would Carmax up their bid to you in a private sale to help offset the tax hit?

 
pats3in4 said:
So will you be paying sales tax on the buyout value and if so, how much?

I'm curious if the sales tax is $1800.  If so, I bet that was factored into the VW quote to Carmax and Carmax didn't want to get stuck paying it.  By you buying the car from VW, you take care of that problem for them.  Would Carmax up their bid to you in a private sale to help offset the tax hit?
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I'm pretty sure that's exactly what's going on.  When you lease, you pay sales tax monthly.  If you want to purchase the car at any time based on the payoff, you are on the hook for the sales tax on that remaining amount (residual).  When you turn a lease in, it's not an issue because the dealer still owns the car.

However, for Carmax, I'm pretty sure they only pay tax on the difference between what they bought the car for and what they sold it for (tax on the profit).  I don't know if they are required to pay the full sales tax on the payoff and then recoup that when they sell it and collect it from the customer that purchases the car. 

 
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