What Happens if You Damage a Leased Vehicle?

When you lease a vehicle, you are essentially borrowing the car from a financial institution. If you damage the vehicle while it is in your possession, you will be held accountable for the wear and tear. Review your lease contract before returning the vehicle to determine what type of condition the car is expected to be in upon the end of the lease terms.

Significance

Before the end of your vehicle lease, the lessor sets up an inspection to decide if you owe money due to excessive wear and tear. Exterior, interior and mechanical components are all inspected and evaluated. The inspector may ask for explanations if major damage is found during the evaluation.

Features

General wear and tear is typically permitted as part of your lease contract. Normal wear and tear may include minor stains, small nicks, minor mechanical issues and exterior scratches on the vehicle. Broken pieces, paint chips, damaged auto glass, multiple dings on the exterior, water damage, major mechanical problems, and tire and wheel damage are all likely to be classified as excessive wear and tear.

Considerations

Although some wear and tear is allowed, measurements may be taken to determine if the damage exceeds what is outlined in your lease terms. For instance, Hyundai requires that lease vehicles be returned without holes in the interior measuring more than 1/8 in. and without tire tread less than 1/8 in. from the shallowest part of the tire.

Prevention/Solution

It is advisable to repair damage to a vehicle before turning it into a dealership. Dealership prices for repairs are likely to be much higher than finding a private body shop to fix the damage. Instead of charging you for the repair, you may be asked to pay the estimated cost to bring the car to perfect condition again. Service fees may also be charged when you don't fix damage on a leased vehicle. Call several body shops to receive quotes before choosing the lowest price. If major damage was sustained as a result of an accident, consider going through your insurance company to fix the car. Deductibles may apply.