Question: I traded my leased Jeep with six payments left to a Honda dealer. I gave them the money to cover the last six payments. How bad did I screw up?

August 30, 2005

Hi Tony

I was just up in your neck of the woods this summer. I'm originally from Kinsman, Ohio.

Anyway, about 4 months ago I traded my Jeep Laredo in on a new Honda Accord. I had 6 months left on my lease, so I gave the dealer 6 months worth of payments and he took the Jeep.

Well, I am still getting a bill from Chrysler each month with a $0 balance. I called them, and they said the Jeep has not been properly returned to them or the original dealer, and that I'm still responsible for the Jeep.

I can't get any phone calls returned from the Honda dealer, but would like to know how badly I may be screwed here!!!!

Thanks,

Rich S.
West Palm Beach

Answer:

Hi Rich,

Small world, isn't it?

Now let me get this straight . . . you traded a leased Jeep to a Honda dealer and you gave the Honda dealer the six outstanding payments remaining on the lease?

What exactly was your arrangement with the Honda dealer regarding the Jeep? Were they going to pay it off and keep it for resale, or were you trusting them to return it to Chrysler?

If you're getting $0 Balance statements from Chrysler that would indicate that the lease payments were made, but the Honda dealer didn't actually pay off the balance or buy it from Chrysler. If this is the case there could be someone at the Honda dealer driving the Jeep around and having a grand old time with it! They have six months to play around with it!

Normally when you trade in a lease the dealer agrees to pay off the entire balance just like they would if it was a conventional loan. This is the only way they can get a clear title to resell the vehicle.

You need to talk to the Honda dealer fast! You should contact the General Manager or the owner. Don't waste time on the salesman or the Finance Manager. You need to know what exactly is going on. If you traded the Jeep they should pay off the balance - not just the remaining payments which you gave them the money to do - but also the residual amount that actually buys out the lease.

On the other hand if you are relying on them to turn the Jeep in to Chrysler you're probably in big trouble! If this is the case, what were you thinking?!

All my very best...

Tony Iorio

Further Comments From Rich:

Yes, I did a dumb thing, but it's not the first time!!!

I just got back from the Honda dealer and they assure me the Jeep was in the back lot and someone "dropped the ball" on returning it to Chrysler.

Fact is, I'm sure the sales girl, who was off today, has been driving it! Hopefully they truly will turn it in this week.

Thanks again, see you at the Pit and Pub sometime!