Escaping a car lease gets easier
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Ken Greenberg of Encino, Calif. has traded leases twice.
"I actually started out using the lease-trading sites, but then ended up doing the transactions on my own, once through Craigslist," he says. "In the case of the BMW 336i that I wanted to get out of, BMW of North America makes it very easy to transfer the lease. I filled out the paperwork and the buyer took over the lease."
Before trading into the lease he ultimately wanted -- a BMW 335i -- he leased a Porsche Cayenne for three months, then traded out of that lease.
"What the lease-trading sites have done is to show you what cars
are available in different regions and that lease trading is an
option," he says. "They also have good information on their sites,
so whether you end up doing a lease trade through them or not they
are an invaluable starting place."
Before completing a deal to buy a lease, make sure the car you're getting is the car you're expecting to get, says Reed.
"Remember that lease-traded cars aren't new cars. Don't go into this thinking that you are getting a new car," he says. "Shop around and compare what kind of deal you could get for the same model new. Think about whether you can really afford the payment and how far you might have to travel to get the car you want," says Reed.
Leasing a car for a short period, such as six months, can be a
good way to try out a brand of car that you might be interested
in buying or leasing in the future. Short-term leases can also be
a good solution for people who are relocated to jobs in another
parts of the country for short periods of time.
Legal issues
While car lease companies and dealers were initially suspicious
of lease trading, most are more comfortable with the transaction
now and are willing to facilitate leases between sellers and qualified
buyers. However, some dealers -- including Audi and Nissan, according
to Stiberman -- still insist that the original lessor retain some
liability for the lease car even after it is transferred to someone
else.
That means if the new lease owner doesn't make payments or damages the car in some way, you, as the original lessor, will be liable.
"This is a deterrent for would-be buyers of these types of leases," he says. "We tell sellers and buyers of these models upfront what the issue is. Most sellers of these brands don't want to have any liability in the future, so they won't go forward with listing their vehicles."
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