A few years ago you decided to lease a car. You weren’t quite ready to commit to buying a car, and the more affordable leasing payments made much more sense. But now it’s three years later and your lease is up. And you just can’t bear to part with your car for one reason or another. What do you do now?
Today we’re talking all about car lease purchase – the whys, the whens, and the hows.
First up; how do car leases work?
Think of your car lease as a long term rental. You do not own the car, but instead pay to use the car. The company that owns the car will draw up a lease agreement that outlines all of the conditions of your lease. Car leases will typically outline the following:
In addition to these nitty gritty details, there will be limitations and restrictions outlined in your lease agreement. These will vary greatly from lease to lease, but they will most likely include the following:
If you drove your car a lot during your lease and racked up excessive mileage fees and excessive wear and tear fees, it might make more sense to buy your car. Lease purchase can be a good move if you are facing thousands of dollars in fees.
If you’re wondering how to get out of a car lease early, there are a few different ways to do so.
If you are unhappy in your lease and need to get out of it ASAP, you can simply terminate the lease. You will be responsible for whatever payments and fees are outlined in your lease agreement. The Consumer Leasing Act requires for all leasing companies to transparently list what fees and payments you are responsible for by terminating the lease early.
The early termination fee will take into account how much time you have left on your lease. It may also include vehicle disposal fees, transfer fees, and taxes. And on top of this you will still be responsible for any past due payments, late fees, and parking tickets that may be outstanding.
If you are contemplating early lease termination, you should call your leasing company to get an exact cost of termination. Because of how lease payments are structured, the earlier you terminate your lease, the more expensive it will be for you.
Another option to get out of a car lease early is to transfer the lease. This may not be permitted in your lease agreement, so be sure to check the fine print. If it is allowed, you will have to make sure that the new lessee meets the credit requirements of your lender. There are many companies that will match people looking to transfer their leases to people looking to take over the leases. Websites such as swapalease.com and leasetrader.com are great places to start.
In many cases, a car lease buyout is the best way to get out of a lease early. The cost to purchase your car early should be outlined in your lease agreement. There may be additional fees to end the lease, but it still might be worth it for you depending on why you are looking to end your lease. If you buy your car early and sell it privately, you might make out better financially.
There are pros and cons to ending a car lease early. If you have a change in life circumstances that make having a car difficult, you should do the math and see if ending your lease makes sense. But if it’s just a case of not liking your car as much as you thought you would, you might be best served to keep the lease until the end of your term.
If you want to lease a car, do a lot of research ahead of time to make sure you will still want it in a few years.
Leasing a car with the option to buy is a great way to get a new car with lower upfront monthly payments. The monthly payments will be significantly lower than if you purchased the car new from the beginning. But how do you pick the right car for lease?
When your lease ends, weigh your options carefully. Think about the condition of the car – is it still in good shape or does it have some battle scars? If the car isn’t in great shape you may not want it as much, but you may be liable for some hefty fees if you choose to give the car back.
Determine what the market value of the car is and compare it to the buyout amount listed in your agreement. Is it still a good deal or did the car depreciate more than you anticipated, making it a bad investment?
If you still love your car and decide it makes more sense to keep it than to give it back, you will need to secure financing as the next step. That’s where Auto Approve comes in. With competitive rates and a simplified buyout process, keeping your set of wheels has never been easier.
If you’re interested in a car lease purchase, Auto Approve has you covered. Our agents are eager to keep you in the car you love, all while saving you money. Our passion is saving you money, so contact us today!