Here Is One Easy Way to Escape Your Car Lease Early
It’s no secret that the global chip shortage has greatly reduced the inventory numbers at dealerships across the nation over the past year. Unfortunately, the shortage hasn’t let up in 2022 as Automotive News recently reported that around 187,200 vehicles were removed from global production this year. So what are dealers doing about it?
They’re buying out leases from consumers, which could benefit those that are currently in leases and can’t afford the monthly payments anymore. In fact, this type of lease transfer could be the easiest way to escape your car lease early.
One way that dealers are obtaining more inventory is through Swapalease
While dealers nationwide have dealt with new and used car inventory shortages for the past year, one way they are alleviating the deficit is through sites like Swapalease.com. If you’re unfamiliar with Swapalease, then just know that it’s a marketplace where consumers that are leasing their cars – also known as lessees – can get out of their leases early by transferring them to other consumers. At least that’s the way I understood it until Scot Hall, the executive vice president of Swapalease.com, set the record the straight in a recent interview I had with him.
“We created an online marketplace where people can come in and get in and out of leases. Most leases are fully transferable per the manufacturer, so our business is primarily built on transferring leases from one consumer to another following the rules, guidelines, and procedures of that leasing company,” Hall said. “What we have done recently since the market has been sideways, is we have been helping dealers buy out customer leases for their inventory and that’s where the 500% increase comes from.”
That large uptick that Hall is referring to is the increase in the number of leases that dealers have bought out from 2021 to now into 2022.
“We have been facilitating that relationship between a consumer who is in the middle of their and dealers that need inventory, or basically emergency inventory,” Hall said.
What does this mean for lessee looking to escape their car lease early?
This dealer-to-consumer transaction benefits both parties greatly as lessees looking to get out of their lease early have a greater chance of doing so since dealers are in need. And on the flip side of that, dealers can pad their inventories with a wider variety of cars, trucks, and SUVs without having to wait for customers to trade their cars in when the lease matures.
“A really good way to think of Swapalease is it’s like a ‘dating service’ for car leases. We want to match people up with those who want to get out (of their leases) with those that want to get in. Frankly, the lease sellers don’t care if they transfer that lease or sell it to a dealer. They just want out in the most economical way, shape, or form,” Hall explained.
The good thing about the used car market being inflated is that cars are worth more right now. That being said, it’s a great time for anyone looking to get out of their lease since they likely won’t face any negative equity charges when doing so since dealers are currently paying top dollar for used cars (or relatively close to it).
“The reason that lease transfers are so popular in ‘normal times’ is that getting out of a lease mid-stream is always a possibility. Leasing is an alternative form of financing where you still have a payoff. So the problem in a lease, at least traditionally, is that in the middle of the lease, you’re in a huge negativity equity position,” Hall said. “The difference now is dealers are buying out these cars at the same point because used cars are worth so much more. Essentially, all of that negative equity is erased. That’s why there has been a shift, at least temporarily.”
Selling or transferring your leased car on Swapalease is easy
Considering there is currently a larger pool of dealers and consumers looking to take on or buy out leases, it’s a great time to put your leased car up on Swapalease.com. The process is pretty simple as you’ll just need to fill out the required information on the site to see if your current lease is eligible to be transferred. If it is, then you can create a detailed listing with all of the vehicle’s information and a description.
When an interested party – whether it’s a dealer or consumer – contacts you about your lease, you will then be assisted by a Swapalease consultant to help you transfer or sell the leased car. Just note that some fees and shipping charges may apply in some cases.
If you want to get the most for your car, then it’s a good idea to act soon as the market won’t stay this way forever. “One concern that I do have is with vehicle prices going up, at some point in the future they will come down, which could create a significant negative equity situation for some people,” Hall said.
That being said, if you want to get out of your car lease early, check out Swapalease.com. It may be the easiest way to alleviate yourself of the stress from those monthly lease payments.