Girlfriend got layed-off two months ago, and is pondering breaking her lease on a 2001 1/2 VW Passat to help ease the finacial pain. She has 20% tint on her windows but nothing else done aftermmarket. Is she going to have any major issues breaking lease. I don't know anything about leasing 'cause I've never done it myself.

 

I believe there is a heavy penalty for it.

 

Yes there are heavy penalties for it. What you could do is buy the car out (no penalty) and SELL it to someone else. That way you will leave with minimal losses.

 

Read the fine print. Talk to the dealer.

See if there is a for breaking the lease.

I always see a lot of people trying to get someone to take over their lease.

 

How about helping your girlfriend finacially?

 

How heavy is the penalty usually?! I think it's like a 28K car.

 

Breaking a lease is almost impossible to do unless you have a boatload of money. If you decide to terminate the lease early you still must pay the remainder due for the lease period minus an allowance for the depreciation that hasn't happened yet. Not so bad if you've got 3 months left, but a killer if you're only 12 months in to a 36 month lease. You can't even get out of most leases unless it's been longer than 12 months. Then you're left without wheels.....

Look at your girlfriend's lease and read the "Early Termination" clause. That will tell you what you have to pay to get out of the lease early. Generally, she'd be better off just keeping the car. If she's worried about making a $300 lease payment now, how is she going to be able to afford thousands of dollars all at once?

-Maria

 

The dealer can do it 2 ways....1. add up your remaining payments (I know, why would you give it back then), 2. Look up the book value on its...lets say its $20k and thats what they give you, then you get your current buyout-from the bank your girlfriend makes payments to...lets say its $24k, you owe the dealer $4,000 dollars. You could try selling it privately for your buyout, or some number below...but that would be hard right now, the used car market sucks because new cars have such good interest rates.

 

My question exactely.

Believe me.....I've thought about it, but I'm not made of money either, ya know?! I've got my own payments and phat rent. Hmmmmmmmm.......what to do......

 

Please read this and make sure you read all of the fine print in your lease papers before you make a decision.

I had a roommate who was royally screwed by a domestic car company's lease program. He, too, was laid off and could no longer make the payments on his car (and it was just a cheap sub-compact). In response to almost daily phone calls from the financing company--where people would threaten him and call him stupid for not being able to manage his finances--he finally told them to take the f-ing car. He broke the lease and it screwed up his credit because it showed up on his credit report as a reposession. What the company did was to sell the car, apply the sales to the balance of what he owed, and he paid the balance off over several years (at like $50.00 per month). But I was helping him go through credit reports and such a few years ago and it was still on there--he also put a consumer statement on his credit report explaining what happened but the effect was minimal.

My advice is to seek other avenues before this one.

 

there is a penalty

 

If she goes in talking about wanting to "down grade" to a Jetta or Golf, the dealer is more willing to work with her. They will usually have her pay a amount equal to 3 - 6 months of the first vehicle payments over the term of the 2nd vehicle.