CONSUMER NEWS RECALLS COMPLAINT FORM SCAM ALERTS

Small Claims Guide \| Class Actions \| Lemon Law \| FAQ \| Resources \| Newsletters \| Spanish
Automotive Education Electronics Family Finance Health Homeowners Shopping Travel

Early Auto Lease Termination

What to Watch Out For

Cheap Car Insurance
Insurance companies on TV can’t compete with our multi-quote system.
Click here for your quote!

Early auto lease termination often results in overcharges, when the consumer/lessee is forced to go through a local dealer to complete a lease termination. Even when not required by the lessor, many consumers terminate their leases upon purchasing or leasing another vehicle.

When they do so, they typically rely on the dealer to get a payoff figure from the finance company, and end up paying whatever the dealer claims is due. Early termination can cost the consumer thousands of dollars, and sometimes dealers will pad termination fees with improper charges.

Not long ago, more than 200 Ford and Lincoln Mercury dealers in California agreed to pay fines totaling $822,500 for alleged deceptive leasing practices. The dealers were accused of adding undisclosed and improper charges in calculating balances due from consumers who chose to terminate their automobile leases early.

Many consumers were forced to take the word of dealers when they sought to terminate lease agreements because the contracts "were very complex and almost impossible for a consumer to understand," Thomas A. Papageorge, head of the consumer protection division at the Los Angeles County District Attorney's office told the Los Angeles Times in ira July 14, 2000 editions.

How can you protect yourself?

Read your lease thoroughly before you sign it. Do not let salesmen rush you and challenge any assertion that a quoted price is good for one day only.
Pay special attention to end-of-lease charges. Make certain you know how these will be calculated and how much you should expect to pay when the lease is up.
Also pay special attention to early termination charges. Be certain you know whether or not you can terminate the lease early and, if you do, what the charges will be.
If at all possible, don't lease. Auto and truck leasing is almost always a bad deal for consumers. It makes sense for businesses and some self-employed persons who can deduct lease charges on their taxes. In almost all other cases, consumers are better off buying.

Whether leasing or buying, be sure to shop around -- not just for the make and model you want but also for the financing. It's a good idea ot pre-qualify with your bank or credit union. Find out how much you can finance and on what terms. This gives you a benchmark to use against whatever financing the dealer offers.

Remember that, even when the dealer is offering special incentives, rebates or what seems to be cheap financing, there may be hidden charges that more than compensate for the savings. Negotiate the sale price of the vehicle and get a written sales contract before you start discussing financing. (Don't actually sign the contract until the financing has been arranged to your satisfaction).

July 5 2008

Print, mail, etc.

FREE CONSUMER NEWSLETTERS

The Daily Consumer
Afternoons M-F
Sign up now!

Consumer News & Alerts
Every Sunday
Sign up now!

Knowledge is free.
Knowledge is power.

Back to the top | Automotive

Terms of Use Your use of this site constitutes acceptance of the Terms of Use

Advertisements on this site are placed and controlled by outside advertising networks. ConsumerAffairs.com does not evaluate or endorse the products and services advertised. See the FAQ for more information.

Company Response Welcome If complaints about your company appear on our site, we welcome your response. Please see the Response Form for more information.

For more information, see the FAQ and privacy policy. The information on this Web site is general in nature and is not intended as a substitute for competent legal advice. ConsumerAffairs.com Inc. makes no representation as to the accuracy of the information herein provided and assumes no liability for any damages or loss arising from the use thereof.