Breaking a car lease - can they charge for miles?

Questions on how we spend our money and our time - consumer goods and services, home and vehicle, leisure and recreational activities
Post Reply
Topic Author
freelancer
Posts: 24
Joined: Sat Jan 10, 2015 2:55 pm

Breaking a car lease - can they charge for miles?

Post by freelancer » Thu Mar 22, 2018 3:22 am

My friend needs to break her car lease 15 months early as she is moving to another city. She is willing to pay out the remainder of her monthly lease payments right now. She still has 10000 miles left on the lease for the next 16 months. The leasing company wants to charge her for "extra miles". They divide the total number of miles by the total number of months in the lease and to get x miles/month. She has used the car for 20 months and used M miles. They want to charge her for M-20x.

This sounds bizarre as she is offering to pay the remainder of her lease which means that there will be effectively 0 miles used for the next 15 months and she still has 10K miles left! There is no mention of this calculation in her lease agreement which just mentions a vague "fees" in case of early termination. The leasing company is charging $300 as fees in addition to this miles calculation.

Does she have any recourse?

mrc
Posts: 1376
Joined: Sun Jan 10, 2016 6:39 am

Re: Breaking a car lease - can they charge for miles?

Post by mrc » Thu Mar 22, 2018 3:53 am

And she cannot or does not want to take the car with her?
Macs are for those who don’t want to know why their computer works | Linux is for those who do | DOS is for those who want to know why their computer doesn’t work | Windows is for those who don’t

onourway
Posts: 2074
Joined: Thu Dec 08, 2016 3:39 pm

Re: Breaking a car lease - can they charge for miles?

Post by onourway » Thu Mar 22, 2018 4:07 am

She should find out what the current buyout price is for the vehicle. If the buyout price is competitive, she should be able to find a dealer willing to buy the car at the buyout price and she walks away. If it's not competitive, it might still be less expensive for her to sell it to a dealer and pay the difference between what they offer and what the buyout price is, rather than paying for 15 months of lease payments plus the extra $300.

Although I'm also wondering why she wouldn't simply bring the vehicle with her?

Topic Author
freelancer
Posts: 24
Joined: Sat Jan 10, 2015 2:55 pm

Re: Breaking a car lease - can they charge for miles?

Post by freelancer » Thu Mar 22, 2018 4:31 am

She won't need the car in the new city and doesn't want to pay for shipping the car across the country. The kbb dealer value of the car is much lower than the buyout value so she doesn't think she can find a dealer willing to buyout.

spectec
Posts: 1433
Joined: Mon Jul 14, 2014 8:00 am

Re: Breaking a car lease - can they charge for miles?

Post by spectec » Thu Mar 22, 2018 6:10 am

freelancer wrote:
Thu Mar 22, 2018 4:31 am
She won't need the car in the new city and doesn't want to pay for shipping the car across the country. The kbb dealer value of the car is much lower than the buyout value so she doesn't think she can find a dealer willing to buyout.
Sounds like the leasing company has already figured that out as well...
Don't gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don't go up, don't buy it. - Will Rogers

Topic Author
freelancer
Posts: 24
Joined: Sat Jan 10, 2015 2:55 pm

Re: Breaking a car lease - can they charge for miles?

Post by freelancer » Thu Mar 22, 2018 11:14 am

The leasing company is a major car manufacturer's financial division.

German Expat
Posts: 643
Joined: Fri Oct 16, 2009 10:49 pm

Re: Breaking a car lease - can they charge for miles?

Post by German Expat » Thu Mar 22, 2018 11:25 am

Any family close by that would allow her to park the car a couple month until the miles wash out and then return it for her to the dealership?

Jags4186
Posts: 3909
Joined: Wed Jun 18, 2014 7:12 pm

Re: Breaking a car lease - can they charge for miles?

Post by Jags4186 » Thu Mar 22, 2018 11:26 am

German Expat wrote:
Thu Mar 22, 2018 11:25 am
Any family close by that would allow her to park the car a couple month until the miles wash out and then return it for her to the dealership?
Likely a wash when you consider that she’ll need to pay for insurance while it’s parked. I doubt the company would allow her to keep a leased car without car insurance even if it is garaged.

ncbill
Posts: 595
Joined: Sun Jul 06, 2008 4:03 pm
Location: Western NC

Re: Breaking a car lease - can they charge for miles?

Post by ncbill » Thu Mar 22, 2018 12:14 pm

so she hasn't tried getting rid of it on a website like swapalease?

User avatar
dm200
Posts: 22280
Joined: Mon Feb 26, 2007 2:21 pm
Location: Washington DC area

Re: Breaking a car lease - can they charge for miles?

Post by dm200 » Thu Mar 22, 2018 12:39 pm

freelancer wrote:
Thu Mar 22, 2018 3:22 am
My friend needs to break her car lease 15 months early as she is moving to another city. She is willing to pay out the remainder of her monthly lease payments right now. She still has 10000 miles left on the lease for the next 16 months. The leasing company wants to charge her for "extra miles". They divide the total number of miles by the total number of months in the lease and to get x miles/month. She has used the car for 20 months and used M miles. They want to charge her for M-20x.
This sounds bizarre as she is offering to pay the remainder of her lease which means that there will be effectively 0 miles used for the next 15 months and she still has 10K miles left! There is no mention of this calculation in her lease agreement which just mentions a vague "fees" in case of early termination. The leasing company is charging $300 as fees in addition to this miles calculation.
Does she have any recourse?
"Bizarre" indeed!

This is a note of caution about the risks of car leasing...

inbox788
Posts: 6646
Joined: Thu Mar 15, 2012 5:24 pm

Re: Breaking a car lease - can they charge for miles?

Post by inbox788 » Thu Mar 22, 2018 1:02 pm

freelancer wrote:
Thu Mar 22, 2018 3:22 am
My friend needs to break her car lease 15 months early as she is moving to another city. She is willing to pay out the remainder of her monthly lease payments right now. She still has 10000 miles left on the lease for the next 16 months. The leasing company wants to charge her for "extra miles". They divide the total number of miles by the total number of months in the lease and to get x miles/month. She has used the car for 20 months and used M miles. They want to charge her for M-20x.

This sounds bizarre as she is offering to pay the remainder of her lease which means that there will be effectively 0 miles used for the next 15 months and she still has 10K miles left! There is no mention of this calculation in her lease agreement which just mentions a vague "fees" in case of early termination. The leasing company is charging $300 as fees in addition to this miles calculation.

Does she have any recourse?
That's bogus! What kind of car? [insert vulgar slang for extremely poor quality] leasing company and car that is so far under the residual value 15 months ahead. Out the brand.

Has she tried Carmax? Even a car dealer should be glad to take the car on consignment and try to lease it or sell it. It's a free 15 month opportunity, and worse case is they turn it in to the manufacturer if it doesn't sell. I'm guessing a fair deal is about half the remainder of the payments, but she's willing to take none.

https://www.dmv.org/buy-sell/leasing/ea ... nation.php

Post Reply