How to get out of a car lease earlyApr 17th, 2020
There are so many reasons someone might want to terminate their car lease early. But whatever the reason, you’ll most likely have to pay a fee to do it. And some ways are better than others and won’t ruin your credit in the process.
Here are five ways to get out of a lease early.
Trade the Vehicle for a Different Model
If you’re looking to get out of your current vehicle lease for financial reasons, trading your current car for a vehicle with lower payments might be the winning option. This is a great way to get out of your lease early. The dealership will handle all the paperwork making this the easiest option. Plus, in this scenario, the manufacturer will often have great incentives to help with negative equity.
Sell the Vehicle
While most people are aware that they have the option to buy their vehicle once the lease agreement has reached an end, many are unaware that you can buy the vehicle from the leasing company at any time. This is known as an early buyout. You’re likely going to have to pay a termination fee to end the lease early, which ranges from $200 to $500. Depending on a few factors, many leasers even find they have equity, while others have a depreciation cost they will need to pay out. In this scenario you would purchase the car from the leasing company and sell it privately. You can also sell it to the original dealership and have them handle the buyouts and contract termination.
Return the Vehicle to the Dealership
When leasing a car, you always have the option to return the car to the leasing company, but be prepared to pay heavily in penalties. You’ll end up paying a large termination fee and the remaining depreciation of the car. It’s a better option to trade the car or sell the car yourself to save more money.
Transfer the Lease
One way to get out of a car lease early is to transfer it to someone else. You can use third-party services to do this, and they will find someone to take over your lease for you, or if you know someone wants to take on your lease you can do so. While most leasing companies will let you transfer the lease over to another person, you need to remember that name on the contract will still be yours, and you will be liable if the other person stops making payments. You will also most likely have to pay a transfer fee to get out of your lease. This can range from $50 to $500 depending on the lease and the company you lease from.
Ask the dealership for help
If you’re looking to get out of your lease for financial reasons, but feel you’ll be in a better place in a few months, you can always reach out to the leasing company or dealership and ask for payment relief for a few months.
Right now, we are all facing unsettling economic times, and all car manufacturers are offering many options to help in light of the COVID-19 pandemic. If you are experiencing financial hardship because of COVID-19, reach out to your dealership or leasing company.
They can help with: a) extending, delaying, or cancelling your current lease contract, b) determining the available equity in your vehicle, and c) reviewing your available options with your vehicle such as trading down to a lower payment, and much more.
Whatever the reason, there are many options to get out of a car lease early that will be available to you. Your best starting point is talking to a professional to review all your options. If you have a KIA, please check out our Financial Assistance page to learn more.
The best insurance against finding yourself in this position is, quite simply, finding the RIGHT CAR. When shopping for a car, go to a trusted dealership that helps you find the perfect fit for your lifestyle – both on the weekend, and during the weekly commute, with payments that won’t stretch you to the breaking point.
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