About Lease Busters

A lease takeover, or LTO, is when a car buyer takes over the lease of another car buyer's vehicle, usually assuming the original lease's terms. What was perceived in the 1990's in Canada as a shaky car lending scheme has since grown into a commonly accepted car acquisition process, benefitting those who cannot afford to stay in their lease, and potential car buyers who cannot get the vehicle of their choice by traditional car purchasing means.

History

Lease Busters is named after the Ontario-based company, Lease Busters, that originated relieving car lenders from their loans in 1990. At the time, Canada suffered from an economy in crisis, and the ending service appeared to be a saving grace for many. Cars at that time often were increasing in price about twice a year, driving up demand for car leases. Meanwhile, many people were losing their jobs, making leasing a desirable option for many.

Features

With the business model known as the lease takeover, both the original loan holder and the person assuming the new loan benefit: The original lender gets to be free for the car, and the new loan holder gets a car loan at a competitive rate. With the proliferation of the Internet, the most efficient way to get started is to surf the Web and research sites that match up those trying to get of a car lease to others who prefer to get out of car leases. Alternatively, you can speak to local dealerships, as any car manufacturers have established partnerships with lease busters.

Considerations

When putting a car up for lease, make sure the vehicle is in the best condition possible, and research the market rate for your vehicle. For more information, visit eHow's article on "How to Take Advantage of Lease Busters." Meanwhile, if on the other end of the lease busting equation, be sure to have the car fully inspected and the lease terms fully vetted by somebody in the know before settling on a contract.

Warning

Leasing a car is considerably more costly than purchasing a car through a car loan. This is because when you are paying the monthly amount, you are not paying on the principal. If you are leasing, you are likely paying a higher amount that if you were to participate in a traditional car loan with a fair interest rate. That said, be sure to exhaust al other better options before jumping into car loan. While it is a desirable option for many, especially since it lets you switch cars with ease, the option isn't for everyone, and many consider it to be a waste of money.

Potential

In the long run, lease busting helps people stuck in leases they can't get out of. It helps others who may have bad credit and cannot get a car loan. For others who tire of cars easily, it lets then have a newer car minus the long-term commitment associated with a traditional car loan.

Resources

• LeaseBusters.com