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Pros and cons of taking over car lease payments Advertiser Disclosure Advertiser Disclosure We are an independent, advertising-supported comparison service. Our mission is to help you make smarter financial decisions by providing you with interactive financial calculators and tools that provide objective and unique content, by enabling users to conduct research and compare information for free – so that you can make sound financial decisions. Bankrate has partnerships with issuers, including but not restricted to, American Express, Bank of America, Capital One, Chase, Citi and Discover. How We Earn Profit The offers that appear on this site come from companies that pay us. This compensation can affect the way and when products are featured on this site, including, for example, the sequence in which they be listed within the categories of listing and other categories, unless prohibited by law for our mortgage, home equity and other home loan products. However, this compensation will affect the information we publish, or the reviews that you see on this site. We do not contain the vast array of companies or financial offerings that could be open to you.
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3 minutes read. published on October 13, 2022.
Writen by Rebecca Betterton Written by Auto Loans Reporter
Rebecca Betterton is the auto loans reporter for Bankrate. She has a specialization in helping readers to navigate the ins and outs of securely taking out loans to purchase an automobile.
The edit was done by Rhys Subitch Edited by Auto loans editor
Rhys has been editing and writing for Bankrate since the end of 2021. They are dedicated to helping their readers feel confident to control their finances with concise, well-researched, and well-studied information that breaks down complicated topics into bite-sized pieces.
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In a time when the market for cars is struggling to keep pace with the shortage of inventory and the need to take over lease payments could be a good alternative to take the wheel. Third-party websites can help you meet someone who is looking to get their lease terminated early. However, since lease agreements generally run for two or three years, you may have to buy the vehicle or return it to the dealer — before you’re prepared. Is a lease takeover a good idea?
Based on your situation the possibility of the option of taking over someone else’s lease can be a smart choice as a lease may come with lower monthly costs and more options for vehicles compared to purchasing.
Advantages of leasing a takeover assuming a lease has clear benefits for those who want to drive a newer model car for a short period. Vehicle availability With car buyers keeping their new cars for an amount of 6.5 years, according to the latest data from , and leases typically run for two to 3 years, it could be difficult to locate an affordable price on a newer car that isn’t the model year currently in use. However, it’s likely that you’ll find a reasonably new vehicle with an assumption of lease. Short-term lease While the average lease agreement lasts for two or three years, a lease assumption ends earlier. It allows you to test drive a car without the need to sign a longer-term contract. It is rare to discover this type of timing at traditional leasing services. Cash incentives Many drivers want to take their vehicle out of their possession in a lease assumption scenario. It is not unusual for the first lessee to offer an incentive in the form of cash. They may also offer to cover any transfer fees a leasing company charges and could reduce the cost by hundreds of dollars. Negotiate with the lessee to secure the best deal possible. Lower monthly payments If the lessee in question has great credit and has made a substantial down payment, it’s probable that the monthly cost is low. Since you’ll take on that monthly payment in the same way and will be able to benefit from their terms. Advantages of a lease assumption Car payments that are low and the flexibility offered by the short-term lease on a car may be tempting however, before you sign the lease, you must be aware of the potential pitfalls. No renegotiation The lease you take over is the lease you get. It is not possible to negotiate the lease terms that the original lessee had agreed to. This means that if their credit score was low, you might be in a position to be paying a greater monthly payment than what you would have received when you signed the lease yourself. You may also have the option of a higher purchase price at the end of your lease than what you’d otherwise pay. Limited mileage : Taking over a lease means that you need to stick to the mileage limitations on the car lease contract. Going over this limit could cost you -Overages can are between 10 and $25 cents for each mile. Make a rough estimate of the number of miles you’ll travel before the lease expires in order to ensure you don’t have to be penalized. And of course, make sure the original lessee hasn’t already been charged costs for mileage overage. Potentially high wear-and-tear costs If the previous driver did not maintain the vehicle, you’ll be stuck with the wear-and-tear fees. Similar to any used car visit the vehicle on the spot and ask to have it checked prior to signing to the leasing. If the vehicle is showing substantial wear, ask whether the original leaseholder will pay for the costs as part of the transfer. Additional charges There are three main fees that come along when you take over a lease: leasing transfer or credit application . According to Swapalease the possibility is that these charges to cost anything from $395 to $895. Be sure to find out the exact details of these charges before committing to an assumption of lease. How do you assume a car lease When you’ve decided to take on the lease, you have a few options available. Lessees who want to hand over their leases turn to websites such as Swapalease, LeaseTrader and QuitALease to find someone who can take on the responsibility. It is also possible to contact the leasing company. They might be able to provide recommendations or in establishing a relationship with a potential lessee. Although the lease’s terms will already determine by initial lessees’ credit, your credit will still be considered. Make sure you negotiate with the lessee for any potential cash rewards in addition. The final word: If you decide to take over the lease, bear your mind in the forefront that the liability that you take on is more than an ordinary auto lease due to the past of the initial driver. You are responsible for the remaining costs of the vehicle and any damage or charges incurred by the original lessee. Compare and shop around for options before signing any agreements. Find out more
Writen by Auto Loans Reporter
Rebecca Betterton is the auto loans reporter for Bankrate. She is a specialist in helping readers in navigating the ins and outs of securely using loans to buy the car they want.
Editor: Rhys Subitch Edited by Auto loans editor
Rhys has been writing and editing for Bankrate since the end of 2021. They are passionate about helping readers to manage their finances with precise, well-studied data that breaks complex subjects into digestible pieces.
Auto loans editor
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