|Personal Finance Article: Leasing a Car on the Cheap|
|News Releases - Business & Economy|
|Written by Steve Burke|
|Tuesday, 28 May 2013 14:01|
By Jason Alderman
My trusty Volvo wagon served our family well for 13 years, but after 106,000 miles it finally gave up the ghost. My wife just completed graduate school so we weren't ready to commit to a new car payment. I rented a car at first, but at $500 a month, that soon got old.
Then I came across a concept new me: assuming someone else's car lease. Initially I was skeptical, but after considerable research I took the plunge. It took many emails and phone calls and a month-long wait for the paperwork to clear, but I now have a one-year lease on a quality car whose monthly cost is about a third less than the stripped-down model I was renting.
With the caveat that car lease assumption is not right for everyone, here's how the process works:
People need to get out of their car leases for a variety of reasons but it's notoriously difficult to do so – you usually must pay the outstanding balance plus an early termination fee.
One way around this, if your finance company allows it, is to transfer the lease to another party for the remainder of its term. Many people use online lease assumption services like Swapalease.com and LeaseTrader.com. I went with Swapalease.com.
These companies match people wanting to unload their lease (think of them as "sellers") with so-called "buyers" interested taking over the remainder of someone's lease. Among the potential advantages for buyers:
However, be aware of the many fees involved on both sides of the transaction:
A few additional suggestions and precautions:
All in all, if you're flexible about what kind of car you're willing to drive and not in a big hurry, assuming someone else's lease can be a viable option. Just make sure to do your due diligence.
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