If you change cars like toothpaste, you may have chosen to lease a car as opposed to buying one. Leasing like anything else has its benefits, like the ability to change cars every few years, which may be a good option for people who get bored of their cars quickly.
Leasing also has its drawbacks where it might not as flexible as buying a car can be. For instance, when you lease a car you need to keep track of your miles, keep the car in good condition and perhaps the biggest caveat is that you don’t own the car. Luckily, you are not confined to the prison of the car lease as there are a few options for selling a car with a lease:
What’s thought of as the easiest way to sell your car before your lease is up is to transfer it through a third party service. Websites like Swap A Lease and LeaseQuit make it an easy process.
Swapalease works by taking down your vehicle information and if it qualifies, a check is made out to you and you are free to post the vehicle on the website. When someone becomes interested in taking over your lease, the transfer paperwork is sent to you, and then you hand the keys over to the new owner.
Leasequit works a bit differently. Their sole purpose is to bring the seller and buyer together, where after you've listed your car a potential buyer can communicate directly with you and come to an agreement. Once that's done, Leasequit steps away from the transfer process. It's somewhat less convenient than Swapalease, however, it does take care of possibly the most annoying part of the process and that is finding a buyer.
The things to be aware of is that sometimes depending on which leasing company you’re using, you may remain on the contract and you will be subject to a transfer fee.
Another option is to trade your car back to a dealership. It will likely make you less money than selling it privately, but once you get the car to the dealership it'll be easier.
Of course, before you take it to the dealership make sure you've completed a checklist to ensure the car is valued as high as possible:
After you've completed all of that, your car is ready to go. You can take it to the dealership you got it from originally, or try a different one, but either way make sure you get the proper market value from a credible source, like Edmunds or KBB. The dealership will pay for whatever is still owed on the vehicle to the leasing company and give you a check for the difference of how much that amount was and the current trade-in value of the car.
In other words, the dealership will assign a value to the car, and subtract what you still owe from that value. That amount is then given to you, and you may put it towards another car which is a sensible option if you want another car.
If you decide to take this route, understand that the dealership will pay according to the wholesale amount for your car. Be sure to get your payoff amount from the leasing company, as for this step of the transaction there is no need to go through a dealership.
While you certainly can transfer the lease, there are different schools of thought as to whether or not it’s a good idea. It depends on if you feel the need to get a different car or simply don’t like what you're driving.
Getting out of your lease, whether you’re going to sell the car or give it back costs a lot of money, and may end up costing even more than if you rode out the lease.
Finally, depending on the nature of your contract you might be able to buy out the lease and then sell the car privately. As a whole, getting out of a lease early might be costly, so in order to determine if this is a good option compare the buyout price to what your car’s market value is.
Make sure you have service records to help give the new lessee some confidence that they aren't getting an abused car. Another thing to remember is the mileage. As stated previously, one of the inconveniences of a lease is that annual mileage is limited to whatever is stated in your contract, and if you’ve gone over that limit it could cost up to 25-cents per extra mile.
Finally, take good care of the car:
Not only do the private buyers take this into account, but so do the dealerships as they’re more likely to give you more money for a car in good condition.
While there's no clear answer, make sure you weigh each option carefully, crunch the numbers and make an informed decision on what to do with your leased car.
Not your typical used car salesman. Our team is here to provide honest and transparent advice about car buying and selling.