How to Return a Leased Car Early

If you want to make a move into a new car or you just want to dump that monthly payment, it might be time to turn in your lease early. Early lease terminations usually come with big fees and penalties but if you know how to do it right, you may be able to save big time.

In many cases, car dealers will make an exception to the early lease termination rule if you are planning to lease a newer, more expensive model. The dealer may accept the hassle of returning the older vehicle a little early in return for the chance to make more off a new lease. Before you think you've gotten away without any extra expense out of your pocket, however, you can expect the fees and penalties incurred from the early return to be included in the cost of the new lease. The dealer will factor them into your monthly payment and spread them out over time. This can help make them easier to handle.

If you want to get out of your lease without paying any extra penalties, signing your car over to a new owner is a good way to do it. To find a new owner, you can place an ad on an online bulletin board or in a local newspaper, or use one of several specialized lease-sublet matching sites. In either case, the interested party will have to meet all the financial qualifications of the lease before signing and pay some fees to get the paperwork switched over. Your car payments will then be the responsibility of the new owner and you will be freed from the lease.

Even a leased car can be bought out for a price. If you want to keep the car but end your payments, buy it out and be done with it. If you want to avoid any early termination penalties and get rid of the car, consider selling it to a private-party buyer for the buyout price. Just ask your dealer what is required to purchase the car outright, then advertise it for sale at that price. In some cases, the buyout price will be higher than the market value of the vehicle so you may have to chip in a bit to make the deal. If the car is worth more than you owe, you may even have a chance to earn a little profit.

Returning your leased car to the dealer early is probably the worst option you can choose, but if you have no choice and just want to get out of the deal, it will certainly end the lease. Inform your dealer that you are bringing the car in to end the current lease and hand over the keys. You will be responsible for all the fees, penalties and sometimes even all the remaining payments due, as outlined in your lease contract. In the end, this method will not save you any money, will negatively affect your credit score in some cases and will leave you with more debt than you already had. The only thing accomplished is the cancellation of your auto insurance, which is sometimes a large expense, and the physical removal of the car from your possession.