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ASU Vader · 07-18-2007, 12:58 AM

I use to sell cars many years ago. Although the car business wasn't for me I learned a lot. You can get out of a lease early. Just as you can sell or trade a car in before you pay it off. Leases work out the best if you stay in them for the full term of the lease. The idea is that if you stay under the set miles and finish the term you should break even and pay nothing but just turn the keys back in and walk away. This is why leases don't appeal to some people because at the end you have nothing to show for all the payments you have made. You have the option to buy the car for the set residual price but most people just get a new car. Lease work for people that don't mind car payments and want a new car every few years. The most common lease terms are 2 - 4 years, anything longer than that it's not worth it.

In your situation if your 18 months into a short term (2 or 3) year lease you may be OK. What will happen is the dealer will look at your car and determent the trade in value then factor in the payments you still have left on your lease and the residual price (price the car is worth at the end of the lease).

This is were it can get sticky. If you have a long term lease (4 - 6 years) you are going to be way upside down (you will owe more than the car is worth) and more than likely you wont be able to trade it in or it will be really hard to do. Even on a short term lease you will owe more than it is worth just not as much. Remember a lease is set up so at the end of the lease you own nothing (your even).

Example:

Car sticker price $30,000.00
3 year lease monthly payment $500.00
Residual $15,000.00

3 year lease (36 payments) - 18 payments = 18 payments to go.

18 payments @ $500.00 = $9,000.00

$9,000.00 + Residual $15,000.00 = $24,000.00 (what you owe on the car)

Trade in value $19,000.00

So your filled about $5,000.00

These are just ruff estimations but you can see the numbers of it. The actual lease calculations will be much more accurate and a bit different but this gives you at lease an idea. If this is close to your actual numbers you should be able to trade it in and maybe jump on a good rebate on a lower priced car or even a used car. Most used cars have at lease $4,000.00 built into the price.

Hope this helps and if anyone else has more accurate info please post it. But this is what I remember of it from my time on the lot.

Good luck and be sure to do all the research you can. Don't think of it as them doing you a favor look at it as your the customer and they need to work to get your buy from them

Thanks,
-Trey

07-18-2007, 12:58 AM	#2 (permalink)
ASU Vader Registered User iTrader: (0) Join Date: Mar 2007 Location: Gilbert, AZ Posts: 9 Thanks: 0 Thanked 0 Times in 0 Posts	Re: Can you get out of a lease early? I use to sell cars many years ago. Although the car business wasn't for me I learned a lot. You can get out of a lease early. Just as you can sell or trade a car in before you pay it off. Leases work out the best if you stay in them for the full term of the lease. The idea is that if you stay under the set miles and finish the term you should break even and pay nothing but just turn the keys back in and walk away. This is why leases don't appeal to some people because at the end you have nothing to show for all the payments you have made. You have the option to buy the car for the set residual price but most people just get a new car. Lease work for people that don't mind car payments and want a new car every few years. The most common lease terms are 2 - 4 years, anything longer than that it's not worth it. In your situation if your 18 months into a short term (2 or 3) year lease you may be OK. What will happen is the dealer will look at your car and determent the trade in value then factor in the payments you still have left on your lease and the residual price (price the car is worth at the end of the lease). This is were it can get sticky. If you have a long term lease (4 - 6 years) you are going to be way upside down (you will owe more than the car is worth) and more than likely you wont be able to trade it in or it will be really hard to do. Even on a short term lease you will owe more than it is worth just not as much. Remember a lease is set up so at the end of the lease you own nothing (your even). Example: Car sticker price $30,000.00 3 year lease monthly payment $500.00 Residual $15,000.00 3 year lease (36 payments) - 18 payments = 18 payments to go. 18 payments @ $500.00 = $9,000.00 $9,000.00 + Residual $15,000.00 = $24,000.00 (what you owe on the car) Trade in value $19,000.00 So your filled about $5,000.00 These are just ruff estimations but you can see the numbers of it. The actual lease calculations will be much more accurate and a bit different but this gives you at lease an idea. If this is close to your actual numbers you should be able to trade it in and maybe jump on a good rebate on a lower priced car or even a used car. Most used cars have at lease $4,000.00 built into the price. Hope this helps and if anyone else has more accurate info please post it. But this is what I remember of it from my time on the lot. Good luck and be sure to do all the research you can. Don't think of it as them doing you a favor look at it as your the customer and they need to work to get your buy from them Thanks, -Trey