jloftus

Greeting Lexonians,

I must have gotten carried away w my car. I have a 39 month lease for a total of 30 thousand miles. I'm almost 4 months into it, and

I already have 7200 miles on it. I'm probably going to be over the limit at the end of the lease. What can I do?

Do you think they'll penalize me too much if I'm getting another lease w Lexus when I turn it in?

Dave Mac

Yes, you will pay a price for going over the miles on your lease and the amount is spelled out in the lease agreement - probably something like 25 cents per mile. And no they won't write it off if you lease another Lexus. What they will waive is the lease-end charge. Lexus Financial is completely separate from your selling dealer and if your sales person says they will cover the over-mileage charge they will just be rolling it over to your new lease. What you can do if the charge is too high is either buy the car at the end of the lease or trade it in on a new car of any make before the lease ends and see how that works out for you. But don't worry too much, people tend to drive new cars more in the early months and things settle out later in the lease. For the first time ever, I am driving my 2016 less than my average and will be ahead by about 4K miles at the end of the first year so even if things change I shouldn't be right at 36K at the end of the lease as I usually am - last time I was within 30 miles.

Just to emphasize how unforgiving LFS can be, a few years ago I was over by 4K miles and the dealer agreed to pay the charge - part of the new deal but really out of my pocket - and they recorded the mileage when I turned it in and sent a check to LFS. By the time Lexus picked up the car it had another 2 miles on it and would you believe they sent me a bill for 50 cents? When I called them they very nicely said we appreciate your business but you still owe us 50 cents.

Enjoy the car though - they are great cars. A thirty thousand miles 39 month lease wouldn't be for everyone.

Dave Mac

gmanusmc

At that rate, you will put about 70,000 miles on the vehicle in 39 months resulting in approximately $10,000 in excess mileage charges. You will also be in a poor trade in position because the market value will likely be much less than what the payoff will be. If you are pleased with the ES, you might consider shopping for a low interest refi and buy the car out now - payments will be higher but you will end up in a much better equity situation down the road. Dave Mac is correct - Lexus IS very strict with lease turn ins.

jloftus

I know, I'm totally screwed, unless I can discipline myself to limit my use of the car to just the daily commute (which is total about 15 miles, 5 days a week).

jloftus

If I'm a 'good boy', and average about 20 miles per day for the remainder of the lease, I'll come in at around 28,500.

But it's hard to be good.....

;-)

dchar

Unless your dealer works it into your deal on your next lease, then you're on the hook for paying the over mileage. That's why it's good to know a general amount of miles you drive every month before signing the lease.

Another alternative is selling the car to CarMax a few months before the end of the lease. Hopefully your car will be worth close to your residual and payments owed. You'll also get out of paying for registration for another year since you are on a 39 month lease.

LexBob2

Do I understand this correctly, for three years (35 months) you'll have to limit your use of the car to an average of 20 miles per day? If so, that really limits the enjoyment of the car.

jloftus

You are correct sir ! :-(

Even at the outset of the lease, the average I was limited to was about 25 miles per day. I got carried away w how nice the car rides, and
took it out for rides on weekends in the country. :-(

dchar, thanks, I'll check out the Carmax option.

https://www.reddit.com/r/Autos/comme...s_heres_how_i/

Or I may just take the hit, and roll the cost into the next car. I'll be turning it in around late October, so they'll probably be eager to deal to
sell the current model year cars by that time.

The last lease I had was for 36000 miles for 3 years, and when I turned it in I had 32000 miles on it. And I actually had to work to get the miles even
that high.

- JL

gmanusmc

It's good that you are considering your options now for this possible situation you might be facing in a few years. Be aware that CarMax is in the business of selling used vehicles for a profit. They will buy a vehicle for fair market wholesale/auction value based on its mileage and condition. I'm guessing the residual on your lease is around 55-57% of what the msrp was. If your vehicle has more than 35k miles on it and is in above average condition, chances are wholesale fair market value will be well short of 55% of new msrp in the appraiser's estimate. That said, if you end up with a high amount of excess mileage, you'll probably come out better by negotiating the highest possible trade allowance toward your next vehicle - the possible negative trade equity will most likely be less than the excess mileage charge.

SW17LS

Honestly, don't worry about it...just enjoy your car. Once you get to the end of the lease you'll have additional options available to you. You can trade the car, buy the car, sell the car, you can wrap the mileage overage into the next lease and make sure that you get enough miles that time which spreads the cost out.

If you obsess about it every day you won't enjoy the car as much. Drive it and enjoy it.

Maikerusan

So ostrich in sand approach is best?

SW17LS

No, just understand you're going to pay to use the car the way you want to use it. Put $200 a month extra away or something and enjoy your car.

Driving more miles than anticipated costs money when you own the car too.

Brent1944

Leasing has never worked for me. I suppose its a good option if you dont drive much, want a more expensive car, and plan on getting a new car every 3 years or so..But you will always have a car payment as well..Ive leaved many over the years.. Even bout 2 we had on lease for our sons...Bad mistake.. We ended up paying much more for them in the long run...You can negotiate more mileage allowed but u will still increase yr lease payment by doing that.

SW17LS

The big plus to leasing is if you can write the payments off as a business expense. Thats primarily why I lease.

Bottom line is, people who derive a benefit from leasing would always have a car payment anyways. If you happily keep a car more than 4 years or so, leasing will always be more expensive.

Sure more miles increase your payment, but more miles also depreciate your owned car faster, its just a question of how that money is being allocated.

jloftus

When driving in this morning (after parking the car the entire weekend, and feeling sad about it), I decided to just drive the car as much as

I want, and worry about the consequences later. Isn't that pretty much what everyone is doing nowadays, including governments?

If I'm way over my limit at lease end, can't I just opt to buy the car - essentially refinancing the residual, and then turn around and trade

it in on a new 2019 car (same or different model)?

Plus I think if I go any any trips I'll ask any passengers to pitch in towards the mileage - the at 25 cents per mile rate. I'll keep that money set aside for

the inevitable overage charge.