Leasehacking 101: How to End Your Lease Early
So you want to get out of your lease? You could be over mileage, in need of a larger or smaller car, or simply desire something new.
First, check to see if the bank your lease is through permits lease transfers: Lease Company Information (Swapalease). Some companies, such as BMW have relatively few restrictions and make it extremely easy to transfer a lease, while others such as INFINITI require the original lessee to remain liable if anything happens to the vehicle. Others, such as Hyundai, do not permit transfers at all.
Assuming you can transfer your lease:
If you got a great Hackr deal, you could post it in the Private Lease Transfers section of Leasehackr Forum to gauge interest.
If you didn’t get a good deal, you should probably post it on Swapalease. Anyone with half a brain on Leasehackr doesn’t want to pay $550/month for your stripper BMW 320i with manual seats. Sometimes a cash incentive that effectively reduces the payment is necessary if it is not a good deal or if there are few miles remaining.
If you can’t transfer your lease (or believe you could have equity):
Check how much Vroom, Carvana, CarMax, etc., will offer for your car. If their offer is higher than the buyout amount, you will receive a check for the difference. If their offer is lower, then you would be required to pay the difference. It also makes sense to check to see if you have any positive equity at lease-end. By selling the car to a third party, this could help you avoid the disposition fee and any wear and tear charges. Please note, some companies, such as Ford, give dealers different buyouts than you, the lessee.
If you have negative equity (you owe more than it is worth), you have several options. One common option is to negotiate with the dealer to decide whether it’s better to make your remaining payments and return the vehicle, or have the dealer buy out your lease and apply the negative equity towards a new lease.
Assume you have a lease with a $200 monthly payment and you have five payments left to pay and the disposition fee (let’s assume $395 for Chevrolet). The dealer could pay $1,000 to close that lease and add those payments to a new lease (and you would receive a bill for the disposition fee). Adding $1,000 in negative equity adds approximately $33 a month to your new lease (assuming 36 months).
If you believe that you must get out of your lease because of mileage overage:
Look into whether or not you can prepay ahead for miles at a discounted rate. Some manufacturers have programs that allow this.
Posted: June 9, 2019