Exit Your Lease Early

Leasing company policies and restrictions

As you might expect, every leasing company works differently.  Not all leasing companies allow you to transfer your lease, and some set certain restrictions upon the seller when transferring a lease.

Here are some of the important factors to consider when attempting to transfer your vehicle lease:

Ability to Transfer – Not all leasing companies will allow you to transfer your leasing obligation.  Some may require you to ride out the balance of your lease regardless of whether you find a qualified buyer or not.  In this case you may consider re-financing your lease with a leasing company that does allow lease transfers, or selling your vehicle outright.  Both approaches are explained later in this section.

Transfer Restrictions – Some leasing companies may put certain restrictions on the nature of your lease transfer.  For example, your leasing company may not allow you to transfer your car to an out-of-state resident.  Or they may not allow you to transfer your vehicle in the last 12 months of your lease. 

Contingent Liability – Some leasing companies may still hold the original lessee liable for the lease in the event that the new lessee (the new lease buyer) fails to make their payments or fails to settle up on any other obligations in the lease (such as excess mileage and wear and tear).  While we have seen many major leasing companies abandon this policy you should still be aware of it. 

If you are leasing with a company that still holds you liable for the original lease contract, you may also purchase a protection policy that will guard against any losses you may cover.  These are provided by third party companies who specialize in this type of lease transfer business. (Swapalease.com is one of these companies.  There may be more, but we are not aware of any!)

Transfer Fees – Most leasing companies will also assess a one-time transfer fee upon lease transfer.  Beware: some companies even charge the transfer fee before the buyer is credit-approved, which means there will be a charge assessed even if the transfer is not completed.  The transfer fee can be paid by the buyer or the seller, depending on what your negotiation calls for.