With today’s economy, many events can happen that would make you want to get out of your car lease early – whether it’s a job loss or a medical emergency that leaves you facing mountains of bills. No matter what the reason, there are only a few ways that you can do it, and, depending on the financial agency that your lease is through, you might not have any options at all.
Returning your car early
In this approach, you simply take your car back to the dealership ahead of schedule. And while you can do this, it will probably cost you more then you realize. You’ll be hit with an early termination fee, along with other penalties, depending on the dealership. And, because of your lease contract, you’ll still be required to pay all the payments of the lease term on top of the fees and penalties. Although you won’t have to deal with your car anymore, this could end up costing you thousands!
Trading in your lease
When you talk to your dealership about returning the lease, they might suggest that you trade it in for another one. If all you need is a lower payment, this option will let you get into a cheaper car without paying the remaining lease payments on your old model. You’ll probably still be paying all the penalties and fees, although they may just be bundled into the new car’s contract. If you just need the lower payment, you can also ask the dealership if they can extend the leasing term on your current model, which will make your payments smaller over a longer period of time.
Lease assumption
A more recent option that wasn’t as readily available years ago is lease assumption. This simply means that another person will be taking on your lease, leaving you free and clear. But before you get your hopes up, you need to first look at your lease contract and contact the financial agency holding your lease to see if it’s allowed. There are several dealerships and financial agencies that don’t allow this yet – if that is the case, you’re stuck with one of the first two options.
What you need to know about lease assumptions.
Lease assumptions aren’t totally free – there are still some fees involved, but they’re very low compared to the other options. They can be charged to either the seller of the lease or the lease assumer, or split between both. Something else that should be considered is that you, as the original leaseholder, may still hold some liability for the vehicle. For example, if the lease assumer fails to make a payment, you may be held responsible. Be sure to check with your dealership and financial agency to see if these terms apply to you.
Finding someone who is willing to buy your lease
Finding a buyer for your lease is much easier then you might think. Though this area is still new, there are many websites dedicated helping set up lease assumptions. On these sites, owners of lease contracts will post their lease information – including payment amounts and remaining term length. Prospective buyers will search these listings for vehicles they’re interested in leasing according to the information posted for the different leases. Once a buyer and seller have come to an agreement, the employees of the website will begin working on the legal side of the lease assumption. Just a word of caution – be that lease assumption is for you before you sign up for one of these sites. Once you sign the papers, it’s final!
