Vehiclenomics

Early Termination Fees: Why Ending a Lease Early Is Expensive

Educational explainer. U.S.-focused. Lease contracts vary—always read your actual agreement.

Ending a lease early is often expensive because the contract assumes payments over the full term. Early termination may require you to pay remaining payments, fees, and the difference between payoff and vehicle value.

Reality: Early termination is usually the costliest way to exit—unless you have equity or a transfer option.

Why it costs so much

  • Remaining payments and fees
  • Payoff amount vs market value gap
  • Disposition or administrative charges

Possible alternatives

  • Lease transfer/assumption (if permitted)
  • Dealer buyout offers (rarely great)
  • Keep it to term if possible

How to evaluate

Ask for the official payoff and compare to market value. Include taxes/fees.

FAQ

Can I just return it early and walk away?

Usually no. You’ll typically owe early termination amounts.

What if my life situation changes?

Call the lender and ask about transfer options; policies vary.