How to Terminate Your Car Lease

More than 30% of new car owners lease, rather than purchase, automobiles. The reasons are many-but most people like the low monthly payments which accompany vehicle lease contracts.

If you can't afford your lease payments, your first step is to review your lease agreement. If your total obligation under the lease is less than $25000 and the lease term exceeds four months, the federal leasing act requires your lease include the disclosures regarding the cost and terms of your lease agreement.

If you want to cancel your lease, look carefully at the provisions of your lease agreement describing what happens if you default and how you can terminate the lease early. Many lease agreements include formulas to determine the amount owed for early cancellation that are too difficult to understand.

Difficulty: Moderately Challenging

Instructions

Things You'll Need:

• Reveiw Federal Consumer Leasing Act
• Have a lawyer on call in case you need any help
• Copies of everything you mail out

1. If you find yourself in this situation, write to the dealer stating that you want to terminate your lease early. The dealer will contact you telling you that you owe a certain amount of money, based on a formula.

2. Write a second letter stating that the formula in the lease agreement is ambiguous. State further that you know you are entitled to sue for damages because of the dealer' s failure to use a reasonable formula.

3. Finally, state that you are willing to waive your right to sue if the dealer will drop his claim against you. If the dealer refuses to back off, consider hiring a lawyer to write some letters.

Tips & Warnings

• The lawyer won't really say anything different from what you said, but the lawyer's letterhead carries clout.
• Make sure you know your lease rights before you buy the car!!!!

Resources

• www.whatdoidonow.biz