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Dear Terry,
Twenty-eight months ago, my wife went out to a Cadillac dealership, traded in her paid-off truck and leased a 2007
Cadillac Escalade. I was not present. They took her $40,000 truck and applied $20,000 toward the new lease.
Our financial situation has changed, and she was not able to pay the new truck note for the past 2½
months. Last week, GMAC repossessed the truck. She was behind on payments of $2,500. I offered to pay that amount and
pay any repo fees involved.
Surprisingly to me, GMAC said no, they want the full amount of the truck to buy out the lease, which I
was told was $48,000. I am prepared to pay the full $2,500 plus expenses, or even pay the full remaining balance of the
lease, which is $14,000. But they will not entertain my offers.
What can I do? Do I have any laws on my side? Please help!
-- Harry
Dear Harry,
The terms of what happens to a leased vehicle when it is repossessed should be spelled out in your contract. It does
surprise me that GMAC is being so firm, given the current leasing situation. I would think they would rather have the
lease current rather than be stuck with a sport utility vehicle that will be somewhat hard to sell at auction.
Also, the amount you should owe in any case is the remaining lease payments and the difference between
what they get for the SUV at auction and the residual value stated in the contract. That won't be an insubstantial amount
of money, but it should be less than $48,000.
Beacuse you appear to have some financial resources, it would be worthwhile having an attorney look
into this.
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