Car leasing can be a convenient and affordable way to drive a new vehicle, but what happens if you need to get out of your lease early? Whether it’s due to a change in financial circumstances, a lifestyle change, or simply a desire for a different vehicle, there are several options available for getting out of a car lease. 

Let’s discuss some common ways to end a car lease early.

Option 1: Early Termination

One of the simplest ways to get out of a car lease early is to terminate it early. However, this option is not without its drawbacks. Most car lease contracts have provisions for early termination, but they often come with hefty fees and penalties. 

These fees can range from a few hundred dollars to several thousand dollars, depending on the terms of your lease agreement.

Terminating your lease early can also negatively impact your credit score, as it will be reported as a default on your credit report. This can make it more difficult to obtain credit in the future, as lenders may view you as a higher risk.

If you decide to terminate your lease early, it’s essential to carefully review the terms of your lease agreement and understand the fees and penalties involved. You may also want to speak with your leasing company to negotiate a lower fee or explore other options.

Option 2: Lease Transfer

Another option for getting out of a car lease early is to transfer the lease to someone else. Lease transfers, also known as lease assumptions or takeovers, allow you to transfer your lease agreement to another person who will take over the remaining payments and obligations.

Lease transfers can be a great option if you need to get out of your lease early, as they typically do not involve any fees or penalties. However, you will need to find someone willing to take over your lease, and they will need to meet the credit and income requirements of the leasing company.

To transfer your lease, you will need to contact your leasing company and request a lease transfer application. You will also need to find a potential buyer and have them complete the application and undergo a credit check. 

Once the lease transfer is approved, the new lessee will take over the payments and assume all of the obligations of the lease agreement.

Option 3: Sell or Trade In the Vehicle

If you can’t terminate your lease early or find someone to take over your lease, another option is to sell or trade-in the vehicle. This can be a good option if you have equity in the vehicle or if you can sell it for more than the buyout price.

To sell or trade-in your leased vehicle, you will need to contact your leasing company and request a payoff amount. You will need to pay this amount to buy the vehicle outright and take ownership of it. You can then sell the vehicle to a private party or trade it in at a dealership.

Keep in mind that if you owe more on the vehicle than it is worth, you will need to pay the difference out of pocket. Additionally, you may be subject to sales tax and other fees when you purchase the vehicle from the leasing company.

Option 4: Return the Vehicle Early

You can return the vehicle early to the leasing company. This option is typically only available if you have made all of your payments and have fulfilled all of the obligations of your lease agreement.

Returning the vehicle early can be a good option if you no longer need the vehicle and don’t want to pay any fees or penalties. However, you will need to ensure that the vehicle is in good condition and has not exceeded the mileage limits set forth in your lease agreement. 

You may also be subject to wear-and-tear fees if the vehicle has any damage beyond normal wear and tear.

 Option 5:  Consult with a Lease Termination Company

If you’ve exhausted all other options and still need to get out of your car lease, you may want to consider working with a lease termination company. 

These companies specialize in helping people get out of their lease agreements, and they can provide guidance on the best course of action based on your specific situation.

Lease termination companies may offer a range of services, including negotiating with the leasing company to end your lease early, finding someone to take over your lease, or facilitating a lease buyout. 

However, keep in mind that these companies may charge fees for their services, so it’s important to carefully consider the costs before proceeding.

  Option 6:  Default on the lease

Defaulting on the lease is not recommended, as it can have severe consequences for your credit score and financial future. When you default on a lease, you stop making payments, and the leasing company can repossess the car and sue you for the remaining lease payments and damages.

The benefits of defaulting on the lease are that you can get out of the lease without paying the early termination fee. However, the drawbacks are severe and long-lasting.

The consequences of defaulting on a lease can be severe and long-lasting. Not only can it harm your credit score, but it can also make it harder for you to get approved for credit in the future. Additionally, the leasing company can sue you for the remaining lease payments, which can lead to wage garnishment and other legal action.

Moreover, if the leasing company repossesses the car, they can charge you additional fees for the vehicle’s repossession, storage, and sale. These fees can add up quickly and make paying off the remaining balance even harder.

In summary, defaulting on a lease should only be considered as a last resort when you have exhausted all other options. If you find yourself in a situation where you can’t afford to make the lease payments, it’s best to contact the leasing company and discuss your options.

Final Thoughts

Getting out of a car lease can be a complex and challenging process, but several options are available. Before making any decisions, it’s essential to carefully review your lease agreement and understand your obligations and options.

Consider speaking with your leasing company or a financial advisor to determine the best course of action for your individual circumstances. With the right approach and guidance, you can get out of your car lease and move on to a more suitable vehicle or financial situation.