Can I get out of my lease early?

It is possible to end a lease earlier than the end of the term that was negotiated, and there are various ways of doing so with different levels of cost to you:

  • Lease Transfer: Find someone else who is willing to have the term of the lease signed over to them, so they take on the rest of the lease payments and the responsibilities of the lease agreement. The only cost to you is any administration fees, so this is almost always the cheapest option.
  • Early Buyout: You pay the dealer the entire balance of outstanding payments left on the lease, plus the residual value and any applicable taxes. At this point you will own the car as if you bought it. The vast majority of cars lose most of their value in depreciation in the first couple of years, so this method will almost always be very costly. In rare circumstances, a vehicle accumulates equity and is worth more than the cost of buying out the lease, so you can wind up making the money you spent buying out the lease back by selling the car privately. It is extremely rare for this to be the case, however.
  • Changing Leases: you ask to terminate the existing lease with your present car by trading it for a new one, and beginning a new lease with it. You will still be required to pay off the amount left to pay on the first lease, plus residual costs and taxes. This is very risky, because if cost of the car is lower than what is left on the lease, the difference is added onto the new lease and you will be paying the depreciation value of both cars.

Depending on your circumstance, any of these three options might be the most viable for you. Generally speaking, the first option is usually the best way to go but it’s not always possible to find someone willing to take on the rest of the lease from you. If you luck out and your car just so happens to have grown positive equity rather than depreciating its value like most cars do, you can do an early buyout and reap the rewards by selling it.