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Old 16th December 2009, 14:02   #1
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Default car lease - How to consider number of owners

I took car lease from my employer and financed by GE.
The car is in the name of my employer. After completion of 4 years EMI, the ownership would be transferred to me.

Actually I'm the single owner right from the first day. So if the name is transferred to me after 4 years, it would reflect in the RCbook. This makes as if I'm the second owner.

I'm worried about the resale value - as the ownership would be two as per the RC-book - whereas it would be single driver driven car. Not sure if I could justify this if I go for resale.

How does the industry views it?
Anyone from pre-owned car industry? or bought or own such cars?
Please help.
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Old 16th December 2009, 14:43   #2
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@IamSwift, how would you view a car with one owner, but used but 3 people at home ?
Such a car will be pushed as single owner car. Even if it had been used well by 2 of those 3 people and abused by the third. End result : the condition of the car will be the cumulative result how it has been used by all these people. Your resale value will depend heavily on the condition of the car.

Now, coming to your situation : You are likely to lose a little resale value on the car since officially there are two owners. But you can minimize that by taking good care of the car AND maintaining the service records to show that you are the singel owner for the car.

Also retain all the insurance papers - for all years. The policy documents should state you as the user, even though the car is in the name of the company. Also, any paperwork - approval from your company HR when you took the lease /closed the lease etc - combined with the insurance papers I mentioned can help you prove that you have been the single user of the car.

But at the end of the day, whether you can justify it or not will depend on how the prospective buyer sees the car. If he is looking for a bargain, or if he is looking for a good car.

Then again, you are already gaining some by going in for the lease. So the slightly lower resale value will be offset by the savings you have already accrued over the 3-4 years you will have the car with you.

Last edited by condor : 16th December 2009 at 15:01.
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Old 16th December 2009, 14:51   #3
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Whatever you prove, it will be a second owner car according to the book & nothing can change that. Book value WILL come down.
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Old 16th December 2009, 15:07   #4
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I had taken a leased car from my company. At the end of 4 years I bought the car and soon after decided to sell it. Unfortunately I had transferred the car in my name and I became the 2nd owner. When I tried to sell it , I had a tough time. Though the car was in very good condition there were a couple of buyers who did not go for it since they would become the 3rd owner. When I finally sold it i had to bring down my asking price by abt 40k becaus of the buyer becoming a 3rd owner. Irrespective of the condititon of the car the price also depends on the number of ownersof the car
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Old 16th December 2009, 18:17   #5
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Quote:
Originally Posted by condor View Post
@IamSwift, how would you view a car with one owner, but used but 3 people at home ?
Such a car will be pushed as single owner car. Even if it had been used well by 2 of those 3 people and abused by the third. End result : the condition of the car will be the cumulative result how it has been used by all these people. Your resale value will depend heavily on the condition of the car.

Now, coming to your situation : You are likely to lose a little resale value on the car since officially there are two owners. But you can minimize that by taking good care of the car AND maintaining the service records to show that you are the singel owner for the car.

Also retain all the insurance papers - for all years. The policy documents should state you as the user, even though the car is in the name of the company. Also, any paperwork - approval from your company HR when you took the lease /closed the lease etc - combined with the insurance papers I mentioned can help you prove that you have been the single user of the car.

But at the end of the day, whether you can justify it or not will depend on how the prospective buyer sees the car. If he is looking for a bargain, or if he is looking for a good car.

Then again, you are already gaining some by going in for the lease. So the slightly lower resale value will be offset by the savings you have already accrued over the 3-4 years you will have the car with you.
This one is the best explained reply.
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Old 17th December 2009, 01:51   #6
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I too have taken a car in the company's name, though am the sole user. Though this is my perception, the concept of leased vehicles is quite popular and the impact on the resale is going to be minimal, though it will be there.

That said, I am planning to own my car (Getz CRDi) for at least 5 years or until a similar hot hatch that has nothing but sheer power comes in our car scene. The car is already phased out by Hyundai, and the resale value after 5 years will be low- the impact of the RC showing me as 2nd owner is not going to be much in the already low re-sale
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Old 17th December 2009, 03:42   #7
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@Iamswift: You are right as per the market you are the second owner and you would have a slight depreciation in the resale value. After 5 years i dont think you would even think about that depreciation. Enjoy your drive and have it maintained well.

I too have taken my car through lease plan and till this minute no plans of selling it for next 5 years. if at all i have to sell it i am sure my salary would have increased and i can afford to bear that depreciation .. why worry be happy...
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Old 17th December 2009, 12:59   #8
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Thanks all for your inputs.
Your thoughts did shed some light.
Just wondering whats the underlying interest in people to go for less number of owners' car.
One reason might be: A problematic car changes more hands.
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Old 17th December 2009, 18:39   #9
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I don't think it's a big deal. What will matter more will be the condition of the car. Make sure you keep her well, have the entire service history ready at the time of sale, and you should be all set.

Another point : Keep the lease + transfer paperwork on hand. Should be easy to convince any potential buyer that the actual self-driving owner has been one, but the transfer was a technicality. I know I would consider it for a good car!
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Old 17th December 2009, 18:56   #10
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How is the car doing? If you have any plans for changing the car in next 1 year or so, you can consider selling it now itself with the single owner tag. If you are completely happy with the car & going to retain for another couple of years.. enjoy the present rather than fearing the future

Is it mandatory that name transfer has to happen upon completion of lease term? Check with your employer whether leaving the registered name undisturbed without you availing any tax benefits.
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Old 17th December 2009, 20:50   #11
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Quote:
Originally Posted by GTO View Post
Another point : Keep the lease + transfer paperwork on hand. Should be easy to convince any potential buyer that the actual self-driving owner has been one, but the transfer was a technicality. I know I would consider it for a good car!
I totally agree with GTO, as long as you can convince the potential buyer about the ownership of the car, you should be fine. Any normal buyer, who is buying the car for himself would not mind this.

You could also pass on copies of these document to the next owner, if he needs it at the time of the next sale, to prove the same point. I am not sure how safe this idea is though.
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