Lease-X was created to help connect buyers interested in assuming a lease with sellers interested in giving up a lease. Lease assumption is a great option for many people and can benefit both parties in the transaction.

Lease Assumption
• Benefits of lease assumption
• Finding a vehicle
• Negotiating a deal
• Fees and charges

Benefits of Lease Assumption

Assuming a lease is attractive to many buyers because of the very low up front costs. There typically is no down payment required and the buyer benefits from a shorter term lease than if they had obtained it new. Some sellers even offer cash incentives to buyers, which can make assumption an even better deal for the buyer.

For sellers, offering their lease vehicle for assumption is attractive because it allows them to exit a lease early without paying the significant penalties that usually accompany an early termination. Even if the seller offers a cash incentive to the buyer, this is usually much less expensive than paying a penalty fee to the leasing company.

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Finding a Vehicle

Finding a lease to assume is easier than you might think. Start by searching Lease-X and look for a vehicle that meets your needs. You can search by make, model, year, monthly payment or years remaining on the lease.

Look for a vehicle that has a monthly payment within your affordability range and with a term length that matches your needs. If you think you may want to buy the car at the end of the lease then pay attention to the residual price. Mileage allowance is another key factor to consider – how many miles are already on the car, how many are left on the mileage allowance, and do you think you will stay within this allowance given the length of lease remaining?

Location is another consideration. If the vehicle is located close to you then completing the transaction and taking possession is fairly simple. If the vehicle is located farther away you can consider flying to the location and driving the car back home, or having the car shipped directly to you. Either case involves extra expense so take this into consideration when deciding if a particular vehicle is a good deal for you.

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Negotiating a Deal

Once you have found the vehicle you want, simply contact the seller directly and begin negotiating the deal.

Ask the seller for more information about the car. What is the condition of the vehicle? Are there any scratches, dents, or dings on the exterior? Are there any stains or marks on the interior? How many miles are on it? What is the mileage allowance and what are the over mileage fees? Does the monthly payment include taxes?

It’s also appropriate to ask about any cash incentives the seller may offer. Some sellers will pay one or two month’s payment, a cash settlement at signing, or even a cash amount to cover potential over mileage charges if the vehicle has high mileage already on it. If the car is located far away from you, the seller might also be willing to pay shipping costs as an incentive.

Another common point of negotiation is the security deposit the original lessee may have placed on the car. When a lease transfer takes place some leasing companies return the deposit to the original lessee and require a new deposit from the new lessee; others simply transfer the deposit to the new lessee. Either way, the disposition of this money is often a point of negotiation as well between the Seller and Buyer.

When communicating with the seller, keep in mind that there are some things that can be negotiated and some things that can’t be negotiated. The seller can’t alter the term of the lease, the over mileage fees stated in the contract, sales taxes, or the residual price of the car. These items are part of the lease contract and can’t be changed.

The actual lease transfer process is facilitated through the leasing company and is subject to their terms and conditions. The buyer must meet their credit worthiness standards in order to receive approval for lease assumption. Once the buyer is approved and the paperwork is in order, both the seller and buyer must sign the agreement to fully transfer responsibility for the vehicle from the seller to the buyer.

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Fees and Charges

The typical fees for assuming a lease are fairly low. Here are some you may encounter:

• Application fee (charged by the leasing company)
• Vehicle inspection fee (optional – may be negotiated with the seller)
• License and registration fee (paid to your state’s Department of Motor Vehicles)
• Shipping (if needed – may be negotiated with the seller)
• Transfer fee (charged by the leasing company) when the transfer application has been approved

Check with the leasing company for more information about these and any other potential transfer requirements.

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About Lease Contracts

How A Lease Payment Is Calculated

End Of Lease Options

Glossary

Take a look at our leasing guide here.