Lease deals - what happens if stolen?
Discussion
I've seen a few lease deals on MK8 Golf R's and I just wondered what happens in the event of the car being pinched. Maybe it's the echo chamber of online forums but they do seem to have a reputation for theft/attempted theft.
Hypothetical: get car and someone pinches it, assuming I have GAP insurance do they replace it with the same or does everyone get paid out and lease ends. What happens if after that you can't get it insured because the first one was nicked?
Likewise if the other half decides it's too sketchy a car to have on the drive how do you typically get out of the lease. Are you tied to paying of a huge chunk of the remaining lease just to be rid of the thing. The lease sites seem light on details unless you actually do a finance application.
Hypothetical: get car and someone pinches it, assuming I have GAP insurance do they replace it with the same or does everyone get paid out and lease ends. What happens if after that you can't get it insured because the first one was nicked?
Likewise if the other half decides it's too sketchy a car to have on the drive how do you typically get out of the lease. Are you tied to paying of a huge chunk of the remaining lease just to be rid of the thing. The lease sites seem light on details unless you actually do a finance application.
Kiwi79 said:
I've seen a few lease deals on MK8 Golf R's and I just wondered what happens in the event of the car being pinched. Maybe it's the echo chamber of online forums but they do seem to have a reputation for theft/attempted theft.
Hypothetical: get car and someone pinches it, assuming I have GAP insurance do they replace it with the same or does everyone get paid out and lease ends. What happens if after that you can't get it insured because the first one was nicked?
Likewise if the other half decides it's too sketchy a car to have on the drive how do you typically get out of the lease. Are you tied to paying of a huge chunk of the remaining lease just to be rid of the thing. The lease sites seem light on details unless you actually do a finance application.
If you have return to finance GAP, then your car insurer will settle with the lease company, as they hold the interest in the car and own it, and the GAP insurer will also settle any difference between that amount and what the termination cost of the lease agreement is.Hypothetical: get car and someone pinches it, assuming I have GAP insurance do they replace it with the same or does everyone get paid out and lease ends. What happens if after that you can't get it insured because the first one was nicked?
Likewise if the other half decides it's too sketchy a car to have on the drive how do you typically get out of the lease. Are you tied to paying of a huge chunk of the remaining lease just to be rid of the thing. The lease sites seem light on details unless you actually do a finance application.
You then start again with a new lease.
As for your insurance premiums sky rocketing, that depends on a lot of variables. Obviously if it does, you will have to lease a car you can get insured on without it costing a fortune.
In terms of your final paragraph, there is always an early termination cost for dropping a lease before it’s end date and this includes paying up a chunk of the outstanding lease, terms vary between leasing companies.
Superleg48 said:
If you have return to finance GAP, then your car insurer will settle with the lease company, as they hold the interest in the car and own it, and the GAP insurer will also settle any difference between that amount and what the termination cost of the lease agreement is.
You then start again with a new lease.
As for your insurance premiums sky rocketing, that depends on a lot of variables. Obviously if it does, you will have to lease a car you can get insured on without it costing a fortune.
In terms of your final paragraph, there is always an early termination cost for dropping a lease before it’s end date and this includes paying up a chunk of the outstanding lease, terms vary between leasing companies.
Thanks Superleg, just trying to think through all possible scenarios. If ending the lease is mega expensive there must be a few on here who have been burned by say getting a totting up ban just after signing the paperwork and left to pay a fortune on a car they can't use or moving to a new more beat down area where they can't get insured.You then start again with a new lease.
As for your insurance premiums sky rocketing, that depends on a lot of variables. Obviously if it does, you will have to lease a car you can get insured on without it costing a fortune.
In terms of your final paragraph, there is always an early termination cost for dropping a lease before it’s end date and this includes paying up a chunk of the outstanding lease, terms vary between leasing companies.
Kiwi79 said:
Superleg48 said:
If you have return to finance GAP, then your car insurer will settle with the lease company, as they hold the interest in the car and own it, and the GAP insurer will also settle any difference between that amount and what the termination cost of the lease agreement is.
You then start again with a new lease.
As for your insurance premiums sky rocketing, that depends on a lot of variables. Obviously if it does, you will have to lease a car you can get insured on without it costing a fortune.
In terms of your final paragraph, there is always an early termination cost for dropping a lease before it’s end date and this includes paying up a chunk of the outstanding lease, terms vary between leasing companies.
Thanks Superleg, just trying to think through all possible scenarios. If ending the lease is mega expensive there must be a few on here who have been burned by say getting a totting up ban just after signing the paperwork and left to pay a fortune on a car they can't use or moving to a new more beat down area where they can't get insured.You then start again with a new lease.
As for your insurance premiums sky rocketing, that depends on a lot of variables. Obviously if it does, you will have to lease a car you can get insured on without it costing a fortune.
In terms of your final paragraph, there is always an early termination cost for dropping a lease before it’s end date and this includes paying up a chunk of the outstanding lease, terms vary between leasing companies.
Maybe someone else can't stop driving like a tool on a route with camera vans etc etc
Pick the duration of lease that you think you can stomach taking everything in to account.
Happened to me not long before the lease was due to end.
Insurance paid out. Money went to lease company directly (was a faff to get them to communicate).
Insurance is now much more expensive - I have mitigated by holding onto the station car I bought just after the lease car was stolen.
I’ll get a link to my thread.
EDIT: https://www.pistonheads.com/gassing/topic.asp?h=0&...
Insurance paid out. Money went to lease company directly (was a faff to get them to communicate).
Insurance is now much more expensive - I have mitigated by holding onto the station car I bought just after the lease car was stolen.
I’ll get a link to my thread.
EDIT: https://www.pistonheads.com/gassing/topic.asp?h=0&...
As far as I am aware, you dont need GAP insurance for a lease vehicle as its valued differently from a Financed car.
With a lease the insurance company will pay the lease company the value of the car as an asset.
On a financed car, you still owe them a set amount of money, which is usually more than the value of the vehicle, so the GAP insurance will cover the difference between the value of the car, and the amount left on your finance.
With a lease the insurance company will pay the lease company the value of the car as an asset.
On a financed car, you still owe them a set amount of money, which is usually more than the value of the vehicle, so the GAP insurance will cover the difference between the value of the car, and the amount left on your finance.
un1eash said:
You need to consider your down payment also as this will be lost. You may have put £1-3k down, car gets stolen early into lease, insurance and GAP pay lease company. Your out of a car and also £1-3k down. Some GAP policies do offer deposit protection.
Yes I came to post this.Another work around is simply to do a 1xYY payment scheme.
The total cost is usually no different whether you do a 6*23 or a 1*23, it's just your repayments each month are higher as obviously the deposit payment is spread out across the whole period.
Certainly if I just put down 2500 quid and my car was stolen 1 month Later I'd be very very very unhappy..!
PH_77 said:
C143FK said:
So if the vehicle you leased was a good deal at the time and after it’s written off it’s unavailable or price has shot up, you’re pretty much screwed?
In the same way that you'd be 'screwed' when your lease ends.Essentially the answer to the question being asked is that there is no obligation for the lease company to provide a like for like vehicle at the same price, as the replacement is a brand new and unrelated lease deal
mat205125 said:
PH_77 said:
C143FK said:
So if the vehicle you leased was a good deal at the time and after it’s written off it’s unavailable or price has shot up, you’re pretty much screwed?
In the same way that you'd be 'screwed' when your lease ends.Essentially the answer to the question being asked is that there is no obligation for the lease company to provide a like for like vehicle at the same price, as the replacement is a brand new and unrelated lease deal
PH_77 said:
Wouldn't that be great. Unlimited new for old free replacement cars should your lease car be stolen, written-off, or just lost in a very large multi storey car park. Next day delivery of a like for like replacement car guaranteed!
I wonder if the car subscription services do all that (apart from the lost in car park bit)?If you are seriously considering the lease deal then why not ask the lease company customer service line.. ? Rather than people on pistonheads who don't know the answer.
I asked this question to my car lease company when I had a new car on lease, and they said if it gets stolen then insurance will pay out and the lease will end, there wouldn't be any reason for me to have to continue paying money or pay any insurance money. But that may vary from lease company to lease company, so just ask them.
I asked this question to my car lease company when I had a new car on lease, and they said if it gets stolen then insurance will pay out and the lease will end, there wouldn't be any reason for me to have to continue paying money or pay any insurance money. But that may vary from lease company to lease company, so just ask them.
Do lease companies really not provide an opportunity to insure yourself against the cost of exiting a lease early? What if you lose your job and need the money to pay to keep a roof over your head and food in your stomach but have to pay that money to exit a lease that you can no longer afford? I can't believe lease companies haven't factored in the potential for people's circumstances to change and developed an optional solution for people to purchase if they so wish. I wouldn't touch leasing with a barge pole unless I could protect myself from the cost of getting out early.
MitchT said:
Do lease companies really not provide an opportunity to insure yourself against the cost of exiting a lease early? What if you lose your job and need the money to pay to keep a roof over your head and food in your stomach but have to pay that money to exit a lease that you can no longer afford? I can't believe lease companies haven't factored in the potential for people's circumstances to change and developed an optional solution for people to purchase if they so wish. I wouldn't touch leasing with a barge pole unless I could protect myself from the cost of getting out early.
If you could just walk away at any point then lease companies would not be able to stay in business.A lot of people that lease have excellent job security and / or savings, so the specific worries that you have are simply not an issue for many that lease.
Smurfsarepeopletoo said:
As far as I am aware, you dont need GAP insurance for a lease vehicle as its valued differently from a Financed car.
With a lease the insurance company will pay the lease company the value of the car as an asset.
On a financed car, you still owe them a set amount of money, which is usually more than the value of the vehicle, so the GAP insurance will cover the difference between the value of the car, and the amount left on your finance.
You need to be very careful here. I enquired with various insurance companies what would happen in the scenario of me leasing a vehicle and it was stolen or written off.With a lease the insurance company will pay the lease company the value of the car as an asset.
On a financed car, you still owe them a set amount of money, which is usually more than the value of the vehicle, so the GAP insurance will cover the difference between the value of the car, and the amount left on your finance.
They all replied without exception that they would only pay the value of the car at the time of loss.
You can enquire with your insurance, if they would pay the full value in the first year, and most do,
BUT YOU NEED TO CHECK THIS. In the 2nd year it is totally different.
For example car is 40k value new, 1+23 deal,£300 a month, and 15 months into a 2 year lease is stolen.
What would the insurance pay out to the lease company ?
They would not quote me a definitive figure only that they would pay the cars value at the time of loss.
So how much is that ? Anybody's guess
So on a 40k car all the lease company have had from me is £4500.
I know the insurance would not value the car at the difference which is £35.5 more like £28kat a guess,
so who pays the shortfall ?
I tried to get a definitive answer but could not, so i took out a Gap insurance policy.
So in summary, for what it costs and for total piece of mind it is well worth it.
I did a straw poll on the lease thread a couple of years back about people who had lease cars written off (for any reason).
In all cases, gap insurance wasn't required to cover the cost of the car. The 'general' insurance provider and lease co sorted it out between themselves. Most people just ended up with no car, a couple were offered like for like replacements to continue the lease.
Where gap insurance did help was in recovering the initial payment - but it seemed to be months of hassle to actually get the money back from the gap provider. I think they've generally cottoned on now and tend to specifically state whether the initial rental is covered or not - or offer "Initial Rental Cover" as an added extra.
If you want to get out of a lease early, the vast majority of companies want 50% of the remaining payments to cancel. This could obviously be different for each provider, but it's the safest assumption.
In all cases, gap insurance wasn't required to cover the cost of the car. The 'general' insurance provider and lease co sorted it out between themselves. Most people just ended up with no car, a couple were offered like for like replacements to continue the lease.
Where gap insurance did help was in recovering the initial payment - but it seemed to be months of hassle to actually get the money back from the gap provider. I think they've generally cottoned on now and tend to specifically state whether the initial rental is covered or not - or offer "Initial Rental Cover" as an added extra.
If you want to get out of a lease early, the vast majority of companies want 50% of the remaining payments to cancel. This could obviously be different for each provider, but it's the safest assumption.
To give you some reassurance on the Golf R, I had a Mk 7 and a Mk7.5 for a combined 5 years, my mate has had 2 over a four year period and there are 2 others on my road and have been for 3 years (fairly common around here I guess!). So far as I am aware none have had any attempted break-ins or related issues. I guess it depends where you live exactly, I am in a quiet suburb and so a city centre location may be different, but don't be put off by what you read online.
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