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How Can I Get Out of My Car Lease I Can’t Afford?

Written by Steve Rhode

Question:

Dear Steve,

I am currently leasing a 2015 Kia Sorento AWD v6 EX. My payments are huge and it is putting me in financial trouble with my other obligations. My lease is over in 5/14/17 and I currently pay 868.63?mo. I have 56,000 miles on the vehicle. I have asked KIA Finance if it’s possible to refinance and they said no.

Is there a way to pay off the lease amount still owe $86863.00 and then refinance the remainder of the loan with a conventional auto loan. HELP!!

Thank you…Steve

Answer:

Dear Steve,

This is one of the downsides of leasing, you are locked into a long-term rental agreement.

You do have options but I would start with the fine print of your lease agreement to learn what the terms are that you agreed to.

With the approval of your finance company, sometimes you can turn your lease over to someone else who can financially qualify for the lease. You may have to pay a transfer fee.

You could always get an unsecured personal loan for the balance due. Since you would be spreading the loan payments over 3-4 years it would be a lower payment. But you would be carrying those payments past the end of your lease.

If you simply turn the vehicle in, you will get slaughtered on fees and still have to pay the remaining lease.

You can always roll the lease balance into a new purchase or lease deal. However, you will find yourself significantly upside down on the next car.

Another option would be to consider bankruptcy. You could look at discharging your other debt and that would give you the room to make the balance of your lease payments. If you quickly filed a Chapter 7 bankruptcy and held on to the leased vehicle by reaching an agreement with the lender, it would carry you a long way into the time required to rebuild your credit.

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Please let me know in the comments, which option you eventually elect to pursue.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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