01-19-2022, 04:16 PM | #1 |
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Total loss on X7 Lease and difference between Cash Value and Pay off
My insurance company has deemed my leased 2019 X7 as a total loss from an accident. The payoff on the vehicle is $54K. Actual Cash Value (ACV) is $84K. I was told by a couple of different people (unrelated to BMW) that typically insurance pays the leasing company and I get paid the difference between ACV and pay off which is $30K.
I spoke to BMW Financial Services this morning and they indicated that they keep the entire amount, so they would be profiting from the accident and I would not receive the overpayment to put it towards a new car. When I said I am willing to pay the payoff amount to purchase the car, they said it can't be done now that insurance contacted them about it being a total loss. Seems quite unfair. Does anyone have experience with this and can provide guidance on how to resolve it? Thanks... |
01-19-2022, 05:51 PM | #2 |
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My 2018 M3 was totaled. It was valued above the payoff amount. Insurance paid the payoff amount and I received the difference.
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01-19-2022, 06:25 PM | #3 |
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01-19-2022, 06:33 PM | #5 |
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If that's BMW Financial's POV, I would get a lawyer.
I'd LOVE to know what would legally entitle them to pocket in more money than what you would pay to obtain full ownership of the vehicle.
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01-19-2022, 07:20 PM | #6 |
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Leasing does not equal ownership. BMWFS owns the vehicle as of the date of the accident, which you have insured and are renting from BMWFS. The contract, per your state law, should be clear if any of your lease down payment amounts are refundable in this unfortunate situation, but it is unlikely you will realize an insurance gain of $30K on an asset you do not own at the time of the incident.
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01-19-2022, 07:26 PM | #7 |
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Until you have purchased the vehicle via a buy out, the vehicle remains under BMW. That's the way I understand it. However, it'd review if an insurance claim prevents you from executing your lease buy it out option. You are still paying for the lease I'm assuming? So the lease contract should be active.
I call BS on BMW and I'd encourage you to spend a few hours on a good attorney to review this for you. I have sued BMW before and won. If your lease payoff is $30K, you either pay a huge down payment or your lease had a brutal residual?
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01-19-2022, 07:27 PM | #8 |
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I’d go on bmw financial and pay the thing off lol.
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01-19-2022, 07:31 PM | #9 | |
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I need to replace the car with a new one and it seems to me that as long as I pay what I owe to BMW the balance of $30k can be used for a new X7 rather than BMW profiting from an accident. |
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01-19-2022, 07:43 PM | #10 | ||
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You should start the vehicle buy out process with BMW. They should not be refusing a purchase just because the vehicle was involved in an accident.
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01-19-2022, 07:44 PM | #11 |
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Unfortunately I believe this is how BMW finance operates (I have read of similar cases). As soon as the total loss is reported, the lease contract is terminated from their end. So there is no "buyout value" any more. They own the car, and take the proceeds of the insurance payout. Your obligations are to pay any missing amounts from the lease termination (normally leases are upside down, so gap insurance will cover it but in this used car market it is totally the opposite). If you made a down-payment on the lease, they will offer to return a prorated amount. But they will not agree to return the "equity". If you can get around this it will be great but I suspect they have a scenario covered in their lease agreement. Try logging into your account to see if you have a buyout amount any more. If they terminated the lease it is gone. Makes me wonder if I should by out my lease now because I also have a positive equity in my leased vehicle.
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01-19-2022, 07:56 PM | #12 | |||
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01-19-2022, 07:59 PM | #13 | |
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Still doesn't make sense that they would want to profit from the situation rather than provide the difference to buy a new car. |
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01-19-2022, 08:15 PM | #14 | ||
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01-19-2022, 08:39 PM | #15 |
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The insurance company will only pay out the title holder. In a lease, that's the financing company. You have no chance of getting paid unless you can clear title.
You should review lease agreement to see if there is anything in there that covers this situation to allow or prohibit you from buying out. You'll need to work this out with bmw financial and get your title cleared which could take a couple of weeks. Not sure if that works timing wise for you. |
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01-19-2022, 08:58 PM | #16 | |
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01-20-2022, 04:58 AM | #18 |
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This is disappointing. My parents had a leased Volvo totaled and Volvo was paid off and my parents received the difference.I guess this is why they say do not put any money down on a lease
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01-20-2022, 08:07 AM | #19 |
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01-20-2022, 08:40 AM | #20 |
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01-20-2022, 09:11 AM | #21 | |
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Combine that with labor and a $50K+ repair on a luxury vehicle with Gucci electronics and safety features everywhere…you begin to see how $50K isn’t all that much. |
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01-20-2022, 09:47 AM | #22 |
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Ok so what if the car were only worth 30k and the lease payoff were $50k, would BMW eat that? I don't think so. Also, if you were to have traded the car in, you would've been able to keep the difference, that's not BMW's money. I'd hire an attorney.
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