Some lessees often decide that they would like to get out of their car lease or end their car lease early for multiple different reasons.
Whether you want to end your car lease due to financial problems, unemployment, high payments, or simply because you no longer wish to drive the car you were leasing, it is quite possible to terminate your car lease prior to its maturity date.
Most car leasing contracts have multiple paragraphs of legal jargon dedicated to explaining your options should you wish to perform what is called an "early termination.
" As per a written contract, some leasing companies or finance companies even allow you to terminate your car lease at any time throughout the term of your lease.
You should understand, however, that early termination isn't something that your lessor or finance company is too fond of.
You see, they would rather lease a car out to someone who can continually make the payments until the end of the lease.
In this article, we look at 5 different options you have to get out of your car lease early.
These options are to payoff your car, sell your car, trade in your car, voluntarily return your car, or have someone else take over your car lease.
Payoff Your Car Paying off your car allows you to end your lease early and become the owner or title holder of your vehicle.
Most finance companies list your payoff amount on your monthly bill and give you the option of sending them a check for the payoff amount instead of sending them your monthly lease payment.
This option can be pricey since your payoff amount will in most cases be higher than the actual value of your car.
Sell Your Car Selling your leased car requires that you first own the car.
Here, you would first payoff the car and then subsequently find an interested buyer to sell your car to.
This option is pretty unwise for the simple reason that you may have to sell the car for less than the payoff amount in order to find an interested buyer.
You may lose several thousand dollars doing so.
Trade in Your Car You can also trade in your car and then lease or finance the purchase of a new car.
This option only makes sense if your car has "positive equity.
" This means that the value of your car is higher than the payoff amount.
If this happens to be the case, you can trade in your old car and obtain a lease deal with reduced monthly payments.
Voluntary Return With a voluntary return you return your car to the dealership.
Because you are not keeping the car, you are not responsible for paying off the vehicle.
However, you are responsible for paying the price difference between what the leasing company can sell the vehicle for and what the payoff amount was at the time of your turn in.
Lease Assumption With a lease assumption, another interested party takes over your auto lease and becomes responsible for making your payments until the lease maturity date.
This is the simplest and cheapest option.
You should use companies like SwapaLease or LeaseTrader to help assist in the lease transfer.