What happens if I end a car lease early?
Leaving a lease early usually means paying an early-termination charge, roughly the difference between the car's value and what you still owe, plus remaining fees. Federal law (the Consumer Leasing Act) requires this formula to be disclosed, but the cost can still be steep.
Why it matters
Early-termination clauses are standard, but the size of the penalty varies a lot.
What dealers don't tell you
- An early-termination charge that isn't clearly explained.
- Big penalties on top of the remaining balance.
- No option to transfer the lease to someone else.
How to negotiate it
- Ask for the early-termination formula in plain numbers before signing.
- Check whether a lease transfer/assumption is allowed as a cheaper exit.
Worked example
"Upon early termination, Lessee owes the adjusted lease balance minus the vehicle's realized value, plus any unpaid amounts."
See this term in your own car lease
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Explain my car leaseFrequently asked questions
Is it cheaper to transfer a lease than to terminate it?
Usually yes. A lease transfer moves the remaining payments to another person and avoids the early-termination penalty, if your leasing company allows it.
Related terms
Protection that covers the difference if your leased car is totaled or stolen.
Your option to buy the car at lease end (or sometimes earlier) for a set price.
Handing your remaining lease payments to another person so you can exit early.