When a person cannot afford to make the lease payments on a vehicle, one option is to simply return the vehicle. However, this is a bad idea for many reasons. The good news is that a number of options may allow a person with a leased vehicle to get out of the lease. Consumers should understand these options and choose the best one for their needs.
Early Termination
When you return a leased vehicle early, you must contact the lender and notify it of the situation. The lender will then arrange a time and place to take possession of the vehicle. However, you must pay penalties for early termination of the lease. These fees will vary depending on the specific lease terms, but will often be thousands of dollars. The lease documentation will note the fees for early termination. In addition to these penalties, lenders treat an early termination as a voluntary repossession, which will damage your credit score.
Selling the Car
One option for a person with a leased vehicle who needs to get rid of the vehicle is to sell it. Before considering this,you must determine whether the lease allows the buyer to purchase the car. If so, obtain the price of the vehicle from the lender. You'll then have to arrange for the sale of the car and come up with the cash to pay the difference between the sales price and the price the lender is charging for the car.
Lease Assumption
Perhaps the best way to get rid of a leased vehicle is to find someone else to assume the lease. Again, you must determine whether the lender allows another person to assume the lease and the cost of the transaction. Numerous online businesses that help consumers find someone to assume a lease. These businesses provide both a listing service for the vehicle and assistance completing the lease assumption transaction. There are fees to transfer the lease and to use an online service, but this can be the most inexpensive way to get rid of a leased vehicle.
Trading
Many leases allow you to trade in a leased vehicle for another vehicle.This generally does not allow you to get out of paying for the old lease; the dealer simply rolls the cost of the remaining lease into the new lease. However, by moving from an expensive vehicle to an economical one, a person may end up with a lower lease payment even with the addition of the remaining cost of the old lease added.
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