Many people have been having serious trouble with car leases. Since jobs simply com and go just like that in these unstable times, keeping a car lease has been increasingly difficult for the average Joe. Yet you need to seriously about turning the vehicle in before the lease contract expires. This actually should be the last thing you do, I know how it sounds but read on and you’ll understand exactly why that is.
So you’re having trouble keeping up with the payments for your car. So the first thing that comes to mind is to take the car back and be done with it. That is the worst possible thing you can do. Stop and consider other options before you go head first into the dealership and cause yourself a considerable amount of grief later on. Think about the fact that no matter how clean your vehicle is or how little mileage it has, the turn in is considered a “voluntary repossession” with the term voluntary meaning different to the customer. The dealership will have to report this as repossession and on your credit history, the difference between voluntary and repo man is minuscule. So think about it hard before you critically damage your credit score.
Breaking Car Lease
Experts say that a repossession report on a credit report will inflict considerable damage on the credit score. Any kind of repossession, no matter whether it is forced or voluntary, will have just about the same effect on you credit score: burn it. This is taken as a considerable question mark on the person’s responsibility that will remain hanging there up to 7 years. That question mark will give you headache after headache when attempting to make any kind of lease, loan or other form of financing.
So before taking this dangerous leap, talk with the leasing company, explain the situation. They may understand and find a better solution for you. Still payments will pose a problem so you should try either to: pay the lease off, try buying it out, or find someone willing to accept the car and assume the lease.
Paying it off might sound a little ridiculous, but it actually can be beneficial. If you’re confident on your position as an employee, than for the few months you have left of the lease you might want to try to pay it off on a credit card. Of course that will mean paying quite a bit of interest but at least you will be released from the lease and the insurance payments that come with it. All you have to do is to keep the monthly credit payment and you escape face clean and credit intact.
Buying the vehicle out certainly doesn’t sound like a good idea, but if you stop and think about it, you’ll see that it is. Buying it out basically means that you will pay the remaining lease and buy the vehicle with the price calculated when the lease was made. Makes no sense right? Actually it does cause if you buy it earlier and sell it, you will cover up a considerable amount at once, therefore leaving you with very little to pay in monthly fees.
And finally, getting someone to assume the lease, is probably the best option you can have. Head online and search for possible individuals interested in leases. Companies like LeaseTrader are best suited to help you out with that. Individuals are not very hard to find because some are simply interested in a small period lease, thing they cannot get from dealerships unless they pay a lot on monthly fees.