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2016 Edge Titanium with 302A package Lease


tpm419419

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It's the opposite of gap.

 

Let's say you buy the vehicle with $8K down and finance $30K. You total it. Insurance writes you a check for $38K (replacement value). You pay off the $30K and you get your $8K back.

 

If you lease the same vehicle with the same $8K down your payments will be low. But now if you total it, insurance sends Ford a check for $38K because Ford is the registered owner. Ford pays off your lease and keeps the balance. You're out $8K.

 

Now this may vary by state and Ford may have a clause that refunds you the difference but it's up to the leasing company whether they want to do that or not.

 

I'm just giving you a possible scenario where you could lose your big lease down payment.

 

The insurance company is not going to screw you like this.

 

You owe Ford the remainder of the lease payments and residual value of vehicle (which we know is stated in the lease paperwork). If that means you owe for $30k and the value of the car is $38k, Ford would give you the balance since you "overpaid" the balance on your account.

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That's not how it works. The more you put down the less your payments. You pay for the difference between the purchase price and the residual value (value at the end of the lease). You pay the same total amount regardless of how you split it between payments and down payment.

 

The only difference is if you total the vehicle before the end of the lease and you made a big downpayment you may not get it back.

 

Sounds like that's why you don't want to do a downpayment (or large one) if at all possible:

 

http://www.carsdirect.com/auto-loans/should-i-put-any-money-down-when-i-lease

 

http://www.nj.com/business/index.ssf/2014/05/your_money_why_a_big_down_payment_on_a_car_lease_is_a_big_mistake.html

 

http://www.realcartips.com/leasing/0314-dont-put-down-payment-on-car-lease.shtml

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Yes, I doubt that Ford would do that even if they could. But there are other leasing companies other than Ford that might not be so scrupulous.

Could be because I live in New York, but when I leased a Ford from Ford Motor Credit in 1999 (yes, ages ago) GAP insurance was included. Of course now it's not called a Lease due to some stupid NYS law about holding the manufacturer responsible for things you did if it's called a "lease".

 

But regardless, if leasing, I'd definitely make sure the signed paperwork has GAP insurance somewhere (checkbox/etc).

 

Interestingly the NYS DFS doesn't quite say it's mandatory unless certain conditions apply:

 

http://www.dfs.ny.gov/insurance/ogco2008/rg080320.htm

 

And, off topic, but the above link is the reason why I was unable to purchase an extended warranty from HP for a laptop I bought years ago. The DFS determined that an extended warranty was "insurance" and HP was not licensed to sell insurance in New York. Ironically the NY State government agencies could purchase extended warranties from HP for the pc's/servers that the STATE bought, but we, as consumers, could not.

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  • 4 weeks later...

Best of luck with it.

That's the setup I wanted but was given a good deal with the V6 and optional wheels. Think I'm getting it Tuesday.

I was hoping for the Bronze Fire with Cognac interior but nowhere to be found

 

Sounds like a great car. Enjoy. I may end up going to the dealer and seeing what they have that would work for me. I think they said they could change out the seat colors if need be :) I seem to recall they had a V6. I like a V6, but thought this time I would try a Turbo :)

Edited by CapeDave
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  • 6 years later...

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