Your Car Lease Has Ended: What Happens Next?
» Posted August 8, 2018 Resources | Share This Post
When you buy or lease a car, it is important to understand both your rights and your obligations. A Sacramento lemon law attorney can provide you with insight into your rights if a vehicle you've purchased has a defect and can help you to pursue available remedies when cars have problems. You should also understand how the law does – and doesn't – protect consumers who both buy and lease vehicles.
For those who lease a vehicle, not only do you need to know the terms of your lease during the time when you are driving the car, but it is also important to know what happens when your lease term ends.
What Happens When a Car Lease is Over?
At the end of your car lease, you have three possible options that you can consider. The first is to walk away from the car. If you decide to do this, the condition of the vehicle will affect whether you have to pay any additional money. If you have driven more miles than your lease allows, you will typically need to pay a per mileage fee as determined by the lease agreement. If there is damage to the vehicle or problems beyond routine wear-and-tear, you are also going to have to pay for the issues.
Another of the options available to you is to purchase the vehicle. You should consider the condition of the car when deciding whether to buy it. If it has generally been in good condition, then it may be a good purchase – however, depending upon the length of the lease and the miles driven, you may be starting to look at some expenses for things such as tires and new brakes just because you've driven the car for long enough that these parts are starting to wear out.
If you decide to buy the car, there is likely a clause in your lease that specifies what the residual value of the vehicle is at the end of the lease term. Since the majority of car leases today are closed-end leases, the vehicle's value is likely going to be pre-determined by the lease agreement that you signed and it isn't likely to change based on market conditions.
Since you cannot renegotiate the price of the car, you'll only want to buy it if it is a reasonable deal based on the residual value. Be sure to comparison shop for similar used cars so you can decide if it makes financial sense to buy the leased vehicle.
Finally, you also have the option to lease a different kind of vehicle rather than buying the old car or simply walking away. If you lease with the same dealer, you may be offered generous dealer incentives to simply lease another car. The benefit of this is that you get to drive a new vehicle again rather than being stuck with an older car. Of course, you will need to make lease payments, so if you always lease new vehicles, you'll never be without a monthly car payment.
Understanding all of your rights as a consumer is important, whether you buy or lease. If you decide to purchase a new car that has issues, a Sacramento lemon law attorney can help you to explore remedies.