You can avoid car lease payoff scams if you know how to spot them. “No matter how much you still owe on your loan or lease, we’ll pay it off for you!” Sound familiar? This and varieties of this advert are very common on the radio and newspaper. Basically, all scams rely on your brain trick you, but this one is the lowest of the low because the ads imply that your current lease or loan will magically vanish.
That’s impossible. You can’t jump a lease. It’s a contract. If you break it, you would have to answer for penalties and those are done in thousands. So really, these scams are atrocious lies. At first, it may seem as though they are indeed getting you out of your current lease, because well when you break a contract, then you’re out of it. But the payoff penalties still apply and when they do, you could get burned. Plus, your leasing company could bring an action for specific performance against you, plus damages for breaking the contract. That means you’d have to pay for the remaining payment on your lease, plus additional fees for damages or injury. That’s like multiplying your $10,000 remaining lease to 5.
The dealers offering this kind of service are not doing anything for you. All they want is your trade-in so they can give you far below market value for it while selling you a new car at a high profit. And then, what they do is they sell in your trade in for a much higher price. So in the end, you get a possible nasty court action; they get all the profit.
Here’s a more accurate picture of this kind of scam deal:
Let’s say that you are upside down on your car loan, still owing $10,000 for it. You found an ad that said they will pay off your car loan for a trade in with a car worth $15,000. You accepted the deal and the dealer pays off your $10,000 car loan. So now, you owe $10,000 to the dealer, plus $15,000 for that new car you are buying. In effect, you are really financing two cars for $25,000! How did THAT happen?
You see, your payments in loans such as this are spread out over 60 or 70 months. In that length of time, you never notice what’s happening because the payments are low and minimal. But when you take a look at the records and add it all up, you realize that you are NOT saving on your car loan; you are even, in fact, DOUBLING UP your current debt.
You can find out even more about leasing options when you check out the information on https://www.cars.com/. They offer you lease financial calculators to help you better understand a lease…as for the scam – it still happens. The way to avoid this low car deal trick is to stay in a lease until the end. Ride it out. It’s already in your mouth; it’s not that hard to chew. The only right time to trading in a car is when the car is worth more than what you still owe on it. And don’t make the mistake of walking away ahead on a trade in because that has never happened and it never will.