Not Fair: Owners vs. Lease holders

computerman3333

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I just read another article that confirms that owners can sell back their cars in any driveable condition but it still seams like lease holders will go through a full inspection upon return.

http://www.bloomberg.com/news/artic...nners-in-volkswagen-s-diesel-mess-are-drivers

Quote:
"All of the afflicted vehicles will be considered in “clean condition,” even if the wheels are falling off. "

Now I have to get my car back to perfect condition to return it and likely have to replace bald tires too. Not much information is ever spoken about leases.

Does anyone know anything on this topic.
 

Rico567

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In re: the OP title, it's not been demonstrated anywhere I've read that those who own their car and those who are lessees are in the same legal position. For starters, buying back a vehicle from someone who owns it is a very different thing than a lease turn-in. Personally, I can't see any basis for the court just waiving the language in the lease contract dealing with vehicle condition upon turn-in. (Not that such language is not a $ono&ab1tch, I had one experience getting bitten by it to the tune of $600 or so, and that was our last lease!)
I haven't read anything in the settlement language (I've read some, but by no means all of it) that addresses this issue— and I suspect there isn't any, nor is any likely to be forthcoming.
 

Jimmy Coconuts

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If you are leasing a car, you are not the owner. Seems simple enough to me.
 

fredthe

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If you are leasing a car, you are not the owner. Seems simple enough to me.
Yes, and keep in mind that in a lessor takes the hit for any decline in vehicle value, not the lessee. So if you lease your vehicle you have very few rights outside those in your contract.
 

Windex

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If it bothers you that much, just exercise the option in your lease contract to buy out the car... Then you will be the owner and can reap any benefit available to owners under the VW settlement.
 

autdi

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I'm still trying to figure out how the body shop wasn't on the check. I've never had a repair check cut directly to me before. Granted I've had all of 3 claims, someone rear-ended me, someone backed down the entire side of my car while it was parked (and didn't leave a note), and deer jumped on the hood.

Each time, insurance cut a check to the body shop.
 

fredthe

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If it bothers you that much, just exercise the option in your lease contract to buy out the car... Then you will be the owner and can reap any benefit available to owners under the VW settlement.
Too late for that. It appears that even if he buys out the lease now, he's not consider an owner for settlement purposes.

Which makes sense... he had a chance to give it back to VW under the lease agreement, why should they pay him more just because he now purchased it out from the lease?
 

autdi

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If it bothers you that much, just exercise the option in your lease contract to buy out the car... Then you will be the owner and can reap any benefit available to owners under the VW settlement.
No dice. CAS explicitly covers this case. If you hadn't done the buyout of the lease prior to 6/28, you are a lessee, you cannot become an owner on the car. All you can get is the lessee cash, not a buyback.
 

bubbagumpshrimp

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I'm still trying to figure out how the body shop wasn't on the check. I've never had a repair check cut directly to me before. Granted I've had all of 3 claims, someone rear-ended me, someone backed down the entire side of my car while it was parked (and didn't leave a note), and deer jumped on the hood.

Each time, insurance cut a check to the body shop.
I've heard of checks being cut to the policy holder before. However, this case is EXACTLY why many insurance companies won't do that. Especially with a leased vehicle.

I'm curious if he properly reported the lease on the vehicle when he setup the policy. There's no reason whatsoever why someone that's essentially in a long-term rental should get cut a check for a vehicle.
 

GetMore

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Generally, leases will charge you for "excess" wear and tear. They do not expect the car to be in perfect condition. The real question is: What is considered normal wear and tear?

Depending on the company, where you turn it in, and how the person is feeling that day, the inspection can vary greatly. Many years ago my parents leased a Ford Taurus. When they turned it in the guy glanced out the window to see that the car was there, and that was it. Of course, that was Ford.

I would try talking to one of the people that handles the turn in. Find out what they look for, and what you would be responsible for, or what they don't worry about.

In my opinion, generally OEM tires don't last all that long, so for VW to sell it as a CPO (Certified Pre-Owned) car they would be replacing tires anyway, so you shouldn't have to worry about that. Shopping cart and door dings are typical hazards of owning a car, but dents are not. There probably shouldn't be any rips and tears, or major stains in the interior. Wear on the pedals is normal.

Other than the tires, is there anything you are concerned with?
 

bubbagumpshrimp

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Generally, leases will charge you for "excess" wear and tear. They do not expect the car to be in perfect condition. The real question is: What is considered normal wear and tear?

Depending on the company, where you turn it in, and how the person is feeling that day, the inspection can vary greatly. Many years ago my parents leased a Ford Taurus. When they turned it in the guy glanced out the window to see that the car was there, and that was it. Of course, that was Ford.

I would try talking to one of the people that handles the turn in. Find out what they look for, and what you would be responsible for, or what they don't worry about.

In my opinion, generally OEM tires don't last all that long, so for VW to sell it as a CPO (Certified Pre-Owned) car they would be replacing tires anyway, so you shouldn't have to worry about that. Shopping cart and door dings are typical hazards of owning a car, but dents are not. There probably shouldn't be any rips and tears, or major stains in the interior. Wear on the pedals is normal.

Other than the tires, is there anything you are concerned with?
See the link posted above. His car received damage severe enough that his insurance company cut him (for whatever reason) a check for $7,000. He went off and spent that money on something other than repair his leased vehicle.
 

fredthe

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*rant*

No, it's not fair, and it shouldn't be. Leases are nothing but glorified long-term rentals, and when the lease ends you are expected to be done with the car.

In the dieselgate case, VW already knows how much the car is valued at at the buy-back time... so that's their cost to get it off the road, and they pay you a few grand for your troubles (same as if you'd sold the car after the value dropped in September 2015).

It makes no sense for VW to sell the car to you now (with knowledge of the settlement agreement) only to turn around and have to buy it back again for a much higher cost. They want to get the car off the road to meet the 85%, for as little as possible.

Yes, it might seem unfair but remember you made the choice (which any financial adviser will tell you was a bad one) to enter into the lease, also remember that VW still owns the car. You are getting compensated for the lie of "clean diesel," and had the advantage of high mileage and good performance while you had the car. There is no reason for the court to treat you any differently than someone who sold their car at a depressed price: you get your 50% restitution and have a nice day.

Proposing to buy it at the end of the lease and sell it right back is nothing more than a scam, which is why the settlement addresses this and prevents it.

/*rant*
 
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GetMore

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I've heard of checks being cut to the policy holder before. However, this case is EXACTLY why many insurance companies won't do that. Especially with a leased vehicle.

I'm curious if he properly reported the lease on the vehicle when he setup the policy. There's no reason whatsoever why someone that's essentially in a long-term rental should get cut a check for a vehicle.
This. ^
Where I am, the lienholder must be on the insurance policy, so the check would be cut to both parties, requiring the lienholder to sign as well before you can cash the check. This might be a provision of the lender, and not the state, come to think of it. Either way, it protects the lender. I would imagine a lease would have the same provisions, especially since they own the car, not the driver.

When the vehicle is at a body shop, and the insurance company cuts a check for the repairs, that is when the check is made out to the body shop and the owner/lessee. That way the owner can verify they are satisfied before the shop can be paid, and the shop is guaranteed that the owner cannot cash the check and run off with the money.
If you have not chosen a shop, the check will not be made out to one.
 

FVWVWF

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See the link posted above. His car received damage severe enough that his insurance company cut him (for whatever reason) a check for $7,000. He went off and spent that money on something other than repair his leased vehicle.
Yeah....so he should be getting money from VW because of dieselgate, I would say anywhere from $5,000-$7,000. On top of that VW should allow him to re-sign the lease for this car with the option to not want it and keep the money or buy it with a $20,000 discount. Whats the problem?
lol
 

IndigoBlueWagon

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I wonder what aggregate savings VW is accruing from all the leased TDIs that they don't have to buy back. Not insignificant, I bet.
 

IndigoBlueWagon

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They plan to fix and resell as many as possible. But I was thinking that their acquisition cost for those cars is about half what it is for the buyback cars.
 

Bisoned

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I just read another article that confirms that owners can sell back their cars in any driveable condition but it still seams like lease holders will go through a full inspection upon return.

http://www.bloomberg.com/news/artic...nners-in-volkswagen-s-diesel-mess-are-drivers

Quote:
"All of the afflicted vehicles will be considered in “clean condition,” even if the wheels are falling off. "

Now I have to get my car back to perfect condition to return it and likely have to replace bald tires too. Not much information is ever spoken about leases.

Does anyone know anything on this topic.

What's not fair? you don't own the car...... you are renting it. The idea of a lease is you turn it in at the end of the lease term and walk away.

You made a very bad choice spending the $7K. You should have thought about this while you were spending the $$.. Luckily VW will make sure you pay, one way or another.
 
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autdi

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They plan to fix and resell as many as possible. But I was thinking that their acquisition cost for those cars is about half what it is for the buyback cars.
VW Credit also likely took a writedown on the value, so they aren't out all the money, and will get some back in tax savings somewhere down the line.

Recall these have to be in good shape anyway under the lease terms, so the lease terminations would likely be far better shape than the general buyback ones. The lease settlement is a bit of money, but only lets folks out of the lease early termination penalty, everything else still holds, condition, miles, etc.
 

solman1

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I don't think VW will fix and sell any of the TDI's they get back. It's a tainted vehicle and not in their interest to get involved with selling these used problem vehicles. Not too sure how much interest there would be in them after all this. All car manufacturers would rather sell new cars and not used ones.
 
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