How Can I Terminate My Car Lease Early? Pros and Cons?

Dec 16, 2015

Many lease customers (and even some Dealership personnel) do not completely understand how to terminate a lease early or how to trade out of a lease early. It is important to keep in mind that a lease is no different than financing a vehicle. At any point in time the bank (Lease Company) is looking for a payoff amount based upon the original purchase price of the vehicle. The ability to terminate early will be determine by the market value of your vehicle as a trade-in or as a private sale to a 3^rd party. A lot depends upon how many months remain on the lease obligation plus the purchase option price (residual value) stipulated on the lease contract. Of course, a Dealer will likely be more aggressive to help trade a customer out of a lease into another vehicle. The Pros of terminating a lease early will help to shorten the length of the lease term and could help to avoid the maintenance and repair costs associated with driving a vehicle with higher mileage. A significant Con is that leasing can be confusing for many. It is important to work with a trusted Dealership and to completely understand the costs and potential fees of terminating or trading out of a lease early.