Renegotiating Your Car Lease: What You Need to Know

Your leasing bank ultimately determines if you can renegotiate your lease; some banks may choose not to renegotiate lease terms if you've already signed your contract. If you haven't signed the paperwork for your lease yet, you can change the terms of the lease to better suit your needs. Consider which options your leasing bank may let you change and which other avenues you can pursue to end your lease without penalty fees.

Before Signing Paperwork

If you haven't signed your lease paperwork yet, you can change the leasing contract terms to better suit your financial situation and driving habits. Most leases are advertised with a low mileage allowance, some as low as 10,000 miles per year. Potential lessees can choose up to 18,000 miles per year or more, depending on the bank. Terms can be adjusted from 24 up to 60 months. You don't have to pay the advertised down payment amount; only your first payment is required to initiate a lease. Offering less of a down payment, increasing mileage or changing term is likely to increase monthly payments.

Dealer Price Negotiation

You can also negotiate the price of the vehicle you lease; doing so is financially beneficial. Most leases are assumed at sticker price, or the vehicle manufacturer's suggested retail price. Depending on the price of the vehicle you choose, you may be able to negotiate thousands of dollars off of the price of the car. Every $1,000 you negotiate off the price of the vehicle is equivalent to about a $30 per month difference in payment. Negotiating the cost of the car can warrant you a lower monthly payment and cheaper buyout price at the end of the lease.

Contract Negotiations With Banks

If you've already signed your paperwork and find you're going over your mileage allowance, call your leasing bank to find if it will allow you to adjust your mileage. Some banks may allow mileage adjustment, but expect to pay the difference upfront, not at the end of the contract. Once the lease is over, you can offer to buy the car for a price less than the amount stated in your contract. Not all banks will agree to this, but if the vehicle's lease-end value, which was predetermined at lease inception, is incorrect; the bank may not receive its asking price when it tries to resell the car.

Lease-End Options

Leasing banks will not negotiate the over-mileage or wear-and-tear penalty fees you agreed to in your contract. If you went over mileage or find you have to pay fees, you can get out of the lease before it's over or avoid returning it by selling it instead. Even if you go over your mileage, you can sell your car for the price listed in the lease contract. If you want to get out of your lease before the contract is over, consider letting someone else assume the lease if the bank allows it. You can call your bank at anytime to obtain the car's purchase price. You can then sell the car, trade it or even purchase it yourself.