Renegotiating A Car Lease
Sometimes, renegotiating a car lease can prove important and it is always good to know what options you have. Basically, the renegotiation involves a change in the contract’s terms asked by the leaser from the finance company. Most of the times, the changes are designed to help you, so you will have to offer some convincing reason in order for the finance company to take your request into consideration.
There a few types of renegotiation. One of these is the hardship renegotiation. That means, the leaser becomes financially unstable and finds it impossible to cover the remaining payments. As a result, the financer will asses the situation and if you bring the necessary proof it might consider changing the terms of the agreement in order to help you continue paying and to minimize its loss. Some conditions that will help you convince the financer to renegotiate the lease include being laid off, getting a divorce, being injured or sick. As a result the company may lower the rates and extend the lease period or offer you a trade-in for another car, less expensive, therefore affordable.
Market adjustment is another possibility, but usually finance companies are hard to be convinced to change the terms of the agreement because of the current market conditions. A situation that might occur is leasing a car, before the average market value of the model leased drops dramatically. As a result you will be paying a lot more for the car than if you would have leased it, let’s say a month later. Considering that the dealer is very happy with the agreement you will find it hard to convince him to change the terms. You might have a chance if you prove that you will still be able to save money even if you terminate the current contract, pay all the fees involved and lease another car from another company. In this case, in order not to loose its client the finance company might agree to change the terms.
The renegotiation of the car lease can involve a lease extension if after the lease expires you still want to use the car for a few more years. If that’s the situation you should expect a decrease in the lease’s cost, because you are now leasing an older car with more miles on board. But in order to be sure this is the best option you should compare the cost of actually buying the car with the cost involved by extending the lease (you can do that by checking out a lease quote). You can also take into consideration the cost of leasing a new car. After doing all these comparisons you should negotiate a fair price for the lease extension.
The early termination of the lease is another situation that involves renegotiating a car lease, but this situation is much more complicated than the lease extension. That’s because if you want to terminate the contract earlier you will have to pay a substantial fee. Moreover, your credit can be negatively affected, because the leasing agent can report the situation as repossession. If you don’t want your credit score to be affected you should try convincing the agent to avoid taking that step by personally delivering the car and paying all the penalties involved.
Never forget that even after settling on a price with the dealership you can still use your skills to renegotiate that value. In some cases it might be absolutely necessary, but even if it’s not you can still do some research and see if the price quoted to you is fair.