What Happens At The End Of A Car Leasing Agreement?

If you’re looking into car leasing and learning about how it could benefit you, you may be wondering what happens at the end of these agreements. Typically, car leasing agreements last for around 1-4 years, or somewhere in between. But what happens after the agreed time period is over? Well, depending on your type of lease, there are a few things that can happen. 

Car leasing company, All Car Leasing, have helped create this guide detailing everything you need to know about what happens when a lease term comes to an end. 

Returning your vehicle 

When your lease ends, you will have to turn in your vehicle and its keys at the agreed time and date. If you’ve grown attached to your vehicle and wish to keep it, depending on what kind of contract you’re in, this could be an option. In a PCP (personal hire purchase) contract, which is a kind of car leasing agreement, you will have the option to purchase your vehicle at the end of the agreement. To do this you will need to cover the balloon payment, which is based on the guaranteed future value of the vehicle. This can be a very attractive choice for those who have grown an attachment for their vehicle and wish to own it for themselves. 

However, if you do not wish to purchase your vehicle, all you need to do is hand over the keys and bring the vehicle in at the end of your agreement. 

Renewing your lease 

When it comes to renewing your lease at the end of your car leasing agreement, you have a couple of options. If you’ve decided you want to continue car leasing, you can upgrade to a newer model of your car, or simply switch to a completely different car or vehicle. This means you’ll be entering a new car leasing agreement after you end your old one, and you can negotiate certain terms with your car leasing company and come to an agreement. 

Alternatively, if you currently don’t want to return your vehicle, you may be able to get a lease extension. This depends on the car leasing company and your agreement, but with some companies, you may be able to get an extension, so you won’t have to part with your current car. 

This is a great option for many as you will have more time to decide what you want to do next. Whether that be opting out of car leasing to purchase a car, entering a new car leasing deal and upgrading your model, or finding a completely new vehicle to lease. 

Pay any additional charges

Another thing to be aware of for when your lease ends is that you may need to settle some outstanding charges. These include: excess mileage fees if you’ve gone over your agreed limit, and excessive wear and tear. To understand what constitutes excessive mileage and wear and tear, review your lease agreement, as everything will be stated somewhere in the contract.