Leaving the dealership with a new car can be one of the best feelings in the world. With a lease, you can have a new car roughly every two years; but, what if you need to get out of your lease early? You may have to break your lease early for financial or personal reasons. Unfortunately, breaking your car lease is going to cost you, though there are ways to minimize these costs. Here are some options that could potentially save you some money.
One of the cheapest ways out of a car lease is to transfer it to someone else. You may be wondering, “Why would anyone want my car lease?” Some people may need a short term vehicle, and don’t want to get stuck in a long-term lease. You can advertise your car on lease transfer websites, although you may be charged an advertising fee. Your car can look appealing by having low mileage, no down payment, and you can even offer a cash incentive that may lower their monthly payments. If you want to avoid the advertising fee, consider asking someone you know to assume the lease. Just double check your lease agreement and make sure it allows for a lease transfer. Some lease agreements will still count you liable for the payments until the end of the lease, in case the new lessee doesn’t make the payments on time.
You may be bored of your vehicle or ready for a lifestyle change. In this circumstance, you may want to trade in your vehicle. This option can be one of your more expensive options. Your leftover payments and any early exit penalties from the current lease will roll over to your new one. This will result in having higher payments, but you will be able to pay the added costs over an extended time period.
Buy the car and then sell it to a potential buyer
In cases where you can’t transfer your lease and don’t need a new car, you may want to consider buying out your vehicle from the leasing company and then selling it. You’ll first want to ask your leasing company for the buyout/payoff amount for the vehicle. In most cases, the car is going to sell for less than the buyout/payoff amount. If you sell to a private party, you may have to pay sales tax. If you had put a bigger down payment on the vehicle you have a greater chance of breaking even.
Return the vehicle
This will be your most expensive option and should be used as a last resort. If you exhausted every other option, or need to be out of your lease as soon as possible, returning the vehicle is an option. When you return the vehicle to your leasing company, you will be paying termination fees and all of the remaining payments. You will want to contact your leasing company and consider all your options before making any final decisions.