Yes, it is possible to trade a car that is being leased. This process is often referred to as a lease trade-in or lease buyout, and it allows you to replace your current leased vehicle with a new one before the lease term is over. Here’s how it typically works:
1. **Evaluate Your Current Lease**: First, review your existing lease agreement to understand the terms and conditions, including the remaining lease term, mileage limits, and any fees associated with ending the lease early.
2. **Visit a Dealership**: Visit a dealership of your choice and explore the new cars you’re interested in leasing. Discuss your intention to trade in your leased vehicle with the dealer.
3. **Appraise Your Current Vehicle**: The dealership will appraise your current leased vehicle. They will assess its current market value (often referred to as the actual cash value or ACV). This value will be compared to the remaining balance on your lease.
4. **Trade-In Negotiation**: If the appraised value of your leased vehicle is higher than the remaining lease balance, you may have positive equity, which can be used as a down payment on your new lease. Conversely, if the appraised value is lower than the remaining balance, you may have negative equity, which you will need to address.
5. **Rolling Over Negative Equity**: If you have negative equity, it can be rolled over into the new lease, but this will increase your monthly payments on the new lease. It’s essential to understand how this affects your budget.
6. **Completing the Trade**: If you agree to the terms offered by the dealership, you can proceed with trading in your leased vehicle for a new one. The dealership will handle the necessary paperwork and coordinate with the leasing company to close out your current lease.
7. **New Lease Agreement**: You will then enter into a new lease agreement for the vehicle you’ve chosen, and your monthly payments will be based on the terms of this new lease.
8. **Returning the Leased Vehicle**: The dealership will typically handle the return of your old leased vehicle to the leasing company, including any end-of-lease inspections and potential fees for excess wear and tear or mileage.
It’s important to note that the specific details and options for trading a leased car can vary depending on your lease agreement, the dealership, and the leasing company. Additionally, you should carefully consider the financial implications, including any additional costs associated with rolling over negative equity, before proceeding with a lease trade-in.
Before initiating the process, it’s a good idea to research the current market value of your leased vehicle to have a rough idea of its worth. Additionally, if you’re considering a lease trade-in, start by contacting your leasing company and the dealership where you intend to lease a new vehicle to understand the specific requirements and options available to you.