Can I Return a Leased Car to Any Dealership?

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Megan Foukes is a recent graduate from Indiana University who graduated with a bachelor’s in journalism. Megan works as a content writer for Auto Credit Express and contributes to several automotive and finance blogs.


, - July 30, 2019

Whether or not you can return your leased car to any dealership depends on the details in your lease contract. Some lessors require you to turn the vehicle in to the dealer you leased it from, while others are OK with you returning it to any dealership affiliated with the leasing company.

Options at the End of Your Lease Term

When lease-end is near, the leasing company usually contacts lessees around 90 days before the termination date. During this time, you should be thinking about what you want to do with the car. You can return it and walk away, return it and get another lease, or buy your leased vehicle.

If you want to return a leased car to a dealer you didn’t lease it from, that dealership must be affiliated – or have an agreement – with your leasing company. It's likely that the lessor is a captive lender that's affiliated with an automaker, such as Toyota Financial Services or Subaru Motors Finance, but it could be an independent company or a bank.

When you lease from a captive lender, you’re free to return the leased vehicle to any franchised dealer of that brand. When your lessor isn’t a captive lender, it’s not so easy. In most cases, the letter you receive 90 days before lease-end explains the inspection process and tells you where you can turn your car in.

Using Your Leased Car as a Down Payment

One of the options you have at lease-end is to buy the leased vehicle instead of returning it. This option could be great if you like the car, or if you’re considering financing your next vehicle and want to use the equity in the leased car for a down payment.

First, you need to determine the actual cash value of your leased vehicle by getting it appraised, and what the buyout amount is. If the buyout amount is less than the actual cash value, there’s equity in the car, and you can use that equity as a down payment on a new vehicle, or even as a down payment on another lease.

At the beginning of the lease, the lessor estimates what the value of your car should be at the end of the lease – called the residual value. It doesn’t happen often, but the lessor sometimes underestimates a vehicle’s residual value, and you could end up having equity in the car at the end of the lease term.

The Bottom Line

The process of turning in a leased vehicle depends on whether you leased from a captive lender, or from a bank or independent leasing company. If you decide to buy your leased car and want to use it toward a down payment on another vehicle, you certainly can – as long as the car’s actual cash value is greater than its residual value. And when you’re ready to trade it in, CarsDirect is here to assist you with the process.

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Megan Foukes is a recent graduate from Indiana University who graduated with a bachelor’s in journalism. Megan works as a content writer for Auto Credit Express and contributes to several automotive and finance blogs.


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