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Early termination of car leasing contract
There are several reasons why people might want to get out of a car leasing contract because we do not know what the future can bring:-
- Change in financial position-your income may have decreased (or increased).
- Job change-job loss, job change, company car offer
- Lifestyle change-you now need a different type of vehicle
- Need a different size vehicle due to family size change?
- Creation of a new business (or closure of your business)
- The car was for your employee who is leaving and not being replaced
- No need for car relocation or emigration
Early termination of the car Leasing contract:
5 ways to get out of your car leasing contract
Some tenants often decide that they want to get out of their car leasing contract or terminate their car leasing contract sooner for multiple reasons. Whether you want to terminate your car leasing contract due to financial problems, unemployment, high payments or simply because you no longer want to drive the car you lease, it is entirely possible to terminate your car leasing contract before its due date.
Most car leasing contracts have several paragraphs of legal jargon dedicated to explaining your options if you want to perform what is called an “early termination”. In accordance with a written contract, some leasing or financing companies even allow you to terminate your car rental agreement at any time during the term of your leasing agreement.
Early termination
However, you must understand that early termination is not something that your landlord or your financing company likes too much. You see, they prefer to rent a car to someone who can continually make the payments until the end of the lease.
In this article we look at 5 different options that you need to take earlier to rent your car. These options are to reimburse your car, to sell your car, to exchange your car, to make your car voluntarily or to entrust the lease of your car to another person.
Pay off your car
Paying off your car allows you to terminate your lease sooner and become the owner or holder of the title of your vehicle. Most finance companies mention the amount of your payment on your monthly bill and offer you the option to send them a cheque for the payment amount instead of sending them your monthly rent payment. This option can be costly, as the amount of your refund will in most cases be greater than the actual value of your car.
Sell your car
To sell your leasing car, you must first own the car. Here you pay first the car, then you find a buyer interested in the sale of your car. This option is rather reckless for the simple reason that you may have to sell the car at a price lower than the amount of the gain in order to find an interested buyer. You may lose several thousand dollars by doing so.
Trade your car
You can also exchange your car, then lease or finance the purchase of a new car. This option only makes sense if your car has a “positive capital”. This means that the value of your car is greater than the amount of the gain. If this is the case, you can redeem your old car and get a lease with reduced monthly payments.
Voluntary return
With a voluntary return, you’re returning your car to the dealership. Because you do not keep the car, you are not responsible for paying the vehicle. However, you are responsible for the payment of the difference in price between the price at which the leasing companies can sell the vehicle and the amount of the gain at the time of the refund.
Leasing hypothesis
With a Leasing assumption, another interested party resumes your car leasing contract and becomes responsible for your payments until the expiry date of the contract. This is the simplest and cheapest option.
Benefits of resuming a car leasing contract?
Resuming someone else’s lease is an inexpensive way to acquire an almost new vehicle because there is no upfront payment or installation fee to be made and you are just starting to pay the monthly lease. In addition, your commitment is less because you are registering for a short-term contract.
If you want to buy your car on lease, you can simply click here.
