7. Your Options
You have several options at the end of your lease. What you decide to do largely depends on your particular circumstance.
Your lease agreement may include the option to purchase your vehicle at the end of the lease. If you want this option, be sure to negotiate it before signing. Without it the lessor has no obligation to make the vehicle available to you for purchase at the end of the lease. They must also disclose the purchase price or the formula for determining the price before the lease is signed if they are offering you a purchase option lease.
Walk Away Option
As long as all of your obligations are met as to the lease agreement, such as mileage, condition and payment agreements, you may be able to simply turn in the vehicle and walk away. There is usually a disposition fee charge with this option.
Right to Early Termination
A lease is a binding contract. Like all contracts, the two parties negotiate its terms. If you think getting out of the lease before its completion is something you might have to do, ask that a provision for it be put in the contract. In many cases, you will be required to keep the vehicle for at least 12 months before exercising any termination option. If you terminate early, you will usually incur extra charges and penalties for doing so. The circumstances under which such penalties and costs are invoked, and the formula used to determine these charges, must be disclosed to you by the lessor before signing any contract.
The lease is your lease. The contract is with you. Since you do not own the vehicle, if you assign your vehicle to a third party you are in violation of the contract. Any and all financial responsibility resulting from such third party reassignments is yours. Work closely with the lessor if you think third party reassignment is necessary. That way the terms can be negotiated so you will not suffer any undue financial obligations.
Whether you decide to lease or not, be sure to keep two things in mind. First, a lease is an important legal document. It entitles you to certain rights but also binds you to certain duties, liabilities and obligations. Know what you are signing before you sign it. Second, most elements in a lease can be structured and adjusted to meet your needs or situation. Make sure you work with the lessor to create the lease that is right for you.
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