Two Ways to Unload Your Auto Lease

Gill paid $1,000 to the person who assumed his lease, considerably less than the $5,400 that he would have had to pay BMW to get out of it early.

Gill recommends that sellers be diligent in screening potential buyers. Make sure that they will take the necessary steps to complete the transaction in a reasonable amount of time. New lessees are responsible for getting insurance, informing the DMV of the ownership change and following up with buyer's former leasing company.

Zoom In on the Trend

The service is catching on. LeaseTrader handled 20,000 transactions in 2006, and is on pace to handle nearly 35,000 this year. Swapalease has transferred more than $400 million in leases since it began in 1999.

"When we first started, industry analysts warned us that there are always more cars available than people who want to take them over," Sternal says. "Today we've got four-times as many buyers as sellers. It's always been skewed more towards buyers than sellers."

That makes sense when you consider what a strong bargaining position people taking over leases have. The seller may include a cash incentive, as Gill did. Also, the initial lease may have been originated when more favorable terms were available.

And if you're looking for a lease shorter than the standard three- to four-year period, you can always get more favorable terms by taking over a pre-existing lease than assuming a new short-term lease.

That doesn't mean every deal is a good one. Chuck Norlin, creator of thebestdealofyourlife.com and a 28-year veteran of the retail auto industry, says it's possible to find a wide variety of incentives, lease payments, residual and terms, not to mention mileage and condition, on similar vehicles.

Prices can vary due to differences in equipment and model, or simply because leases were generated at different times with or without a down payment. For example, LeaseTrader recently listed 11 2006 BMW M5 sedans with monthly payments ranging from $1,200 to $2,215 and remaining term lengths from eight months to 32 months.

Ultimately, he says, sites like these are a great tool for finding a vehicle. But finding the best deal is up to you.

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