Turning in a lease early? Here’s what you need to know
If you’re looking to turn your lease in early, there are a few options to consider and evaluate before taking the plunge. You may want to turn in your lease early for several reasons—maybe you no longer need a vehicle, have a different financial situation, or find the vehicle itself simply isn’t a good fit for your lifestyle. If any of these situations apply and you’re thinking about turning in a leased car early, there are a few things to keep in mind when making this important financial decision.
What happens at the end of a car lease?
If you make it to the end of your lease, there are generally three options:
- Buy your current car (if your lease includes a purchase option)
- Turn in your car
- Turn in your car and lease or buy a new one
If you can make it to the end of your lease, that’s usually the more favorable option from both a financial and logistical perspective. When you terminate your car lease ahead of the agreed upon date, you may face an early termination liability that is considerably higher than what might otherwise be due when keeping the car through the full lease term. If you only have a few months left on your lease, you may decide that it is better to wait until the term ends before returning your car.
Early termination of a car lease, defined
If you terminate your lease early, you may have to pay a substantial charge, which could be several thousand dollars. The actual charge will depend on when the lease is terminated, but the earlier you end the lease, the greater the charge is likely to be. For additional information, see the Early Termination section of your Lease Agreement.
What to consider when ending a lease early
- Your reason for termination
- What the early termination fee would be
- Your lessor’s policies
Before turning in a lease early, it’s best to first speak with your lessor. They may be able to work with you to find a solution or at least inform you of their early termination policies.
