How to Terminate a Car Lease Early

Cars and homes are two of the most expensive items that most people own. While homes may appreciate in value, cars tend to depreciate. Auto loans are often based on values which will be considerably lower in the future. It is for this reason that some people prefer leasing as an option to purchasing a car outright. Most leases last for two to four years and the driver pays monthly "rental" payments at an agreed upon price over the length of the leasing period. Most dealers will penalize you with significant fees if you terminate your lease early and defaulting on a lease can trigger a breach of contract, resulting in negative marks on your credit record.

Difficulty: Moderate

Instructions

Communication Is The Key To Terminating A Car Lease Early

1. Contact lease trading companies. Instead of terminating your lease, consider trading or swapping with someone else. The process reassigns your lease to another person and vice versa. However, you might have to pay fees to the trading company for listing the item once it sells.

2. Buy a new car or trade in your car for a new one at the dealer. Buying a car or extending your lease obligation is often presented as the least expensive option in terms of upfront or short term costs.

3. Buy the car. Request a statement showing the payoff value of the car from the dealer. If the payoff value is lower than the resell value you should consider buying the car outright for a quick profit. Additionally, your credit rating will increase.

4. Talk to your dealer. Sometimes dealers will terminate the contract for extreme personal circumstances. Prove your record for taking care of the car and making payments on time. If they won't terminate the lease, some dealers will offer lower payment amounts to help alleviate some of the financial burden.

Tips & Warnings

• Walking away does not terminate your lease.

References

• LeaseGuide
• Car Leasing FAQs

Resources

• LeaseTrader
• Car Lease Trader Website

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