Returning a leased car

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  • BenutzernameMoneyland User Questions
  • Status Member
  • Registriert seit1/27/17
  • Beiträge2142

What do I need to pay attention to when I return a leased car to the showroom?

  • BenutzernameMoneyguru von
  • OrtSchweiz
  • Status Expert
  • Registriert seit8/4/15
  • Beiträge4016

Hi there,

The most important factor is: Are you returning the leased car ahead of schedule or are you returning it at the end of your lease term?

If you are returning the car at the end of your lease term, as is the standard procedure, the dealer simply writes up a report outlining the car's condition and mileage. If the car has incurred damages or if you have run up more mileage than the limit stipulated in your agreement, you may have to make additional payments to cover these.

Important: Make sure to carefully review the report before you sign it. The agreement may bind you to paying additional, unjustified charges. If you aren't sure, get a second opinion before singing.

If you are returning a leased car ahead of schedule, the process is more complicated. Swiss car leasing agreements generally require that you give three month's notice for early termination.

Terminating a lease early can be expensive because lease providers normally adjust lease rates retrospectively. Cars lose value very quickly during their first years in operation, but lease rates are evenly spread over the full lease term - so the later payments you make subsidize the relatively low payments made during the first years. When you return the leased car ahead of schedule, the amount paid in lease payments until then may not be sufficient to cover the loss in the car's residual value. Car dealers will charge you the difference between the amount paid and the car's resale value.

The amount which you are obligated to pay in compensation when you return a leased car early is shown in the amortization table included in your leasing agreement. Getting this table checked by an expert before leasing a car is recommended.

An alternative to terminating a lease early is to find an acquaintance who is willing to take over your lease. In this case, you only pay an administrative fee for the change in lessee and do not have to compensate for loss of value.

Best regards from Moneyguru

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