If there’s one big con for choosing a car lease over purchasing a new or used vehicle, it’s that you’re pretty much stuck with it for the duration of the lease period. Just ask anyone who has tried to terminate early, and you’ll hear tales of woe and thousands of dollars lost.
If you’re currently leasing a car and trying to get out of it, it’s possible to do so, but you’ll have to make a few concessions. Here’s a look at your options:
Use a Third-Party Lease-Transfer Service
Companies like LeaseTrader or Swapalease exist for the very purpose of helping you transfer your car lease to someone else. The catch is that you’ll have to pay a transfer fee, which can be a few hundred dollars, and you may not be totally off the hook. Some auto companies don’t allow lease transfers at all, while others require your name to remain attached to the lease even after you transfer it, meaning if the new driver doesn’t pay the bill, you’re still responsible and your credit will be affected.
Trade in or Sell the Vehicle
The bad news is that you’ll most likely face a huge loss since your payoff amount will be higher than what the car is worth, and it will be nearly impossible to sell it on your own for that amount. If you want to investigate a trade-in with your leasing company, they may be willing to work with you and roll some of what you owe into your next lease or finance, but again—it will cost you. On the positive side, once this transaction is complete, you’ll be free of your lease.
Return the Vehicle Early
Going this route with the leasing company is easy enough, but be prepared to pay a huge fee for early termination, as well as whatever is deemed to be the depreciation value of the vehicle. If you’re adamant about ending your car lease, though, this will do it.
If the reason you want to end your lease due to you having financial troubles, these options will be difficult for you. However, they’re still much better than simply not paying your bill. Missing payments will damage your credit and make future financial dealings more difficult. You’re much better off contacting the leasing company to see if you can work out a temporary solution until you’re back on your feet.
While leasing might be the preferred option for some drivers, bear in mind that getting out of it early is not ideal. If you’re torn between leasing and buying your next vehicle, be sure to keep this potential pitfall in mind.
Purchasing a vehicle, especially a previously owned one, can be a great option for people with limited budgets. The good news is that sometimes you don’t even need stellar credit to qualify for financing. With a little research, you can find a vehicle in great condition and be behind the wheel in no time, without chaining yourself to a car lease agreement.