Many consumers don't know this, but it is possible to lease a used car instead of a new car. Leasing a used car is best with vehicles that retain their value well, such as Toyota and Honda. 

Although some shoppers don't like the idea of making a car payment indefinitely (as opposed to a car loan that eventually ends), it's a good idea to think of a car lease like a car subscription. You can drive the vehicle for a few years and then trade it in for a newer model or a different model entirely.

Used car leases are a best-kept secret amongst car dealerships, and not all dealers offer them. However, used car leasing exists, and car buyers who do their research well will benefit from more than just savings. Car shoppers could afford a nicer car and save money compared to leasing a brand new vehicle. So, let's explore the "hidden" topic in a little more depth and see how can you lease a used car and why it is an option worth considering. 

### How to Lease a Used Car, Step-by-Step

#### Step 1: Call the Lender

If you have your eye set on a vehicle from a specific automaker, then first place a call to the captive lender of that particular brand and enquire if they offer any leases on used certified pre-owned cars. You should be able to find their phone number for customer services by searching for the brand's name online, followed by "finance phone number." For instance, if you want a used Toyota Corolla, you will call Toyota Financial for their leased CPO vehicles. 

#### Step 2: You Need a Point of Comparison

Everyone wants good value for their hard-earned money, and leasing a used car should offer good value for money. To effectively judge if the deal is a good one and the correct value of the vehicle you want to lease, you need a point of comparison, and having a lease quote for a new car ready is an excellent place to start. If you don't have a new car lease quote, then arrange some lease prices to compare quotes properly. 

#### Step 3: Find Your Car

Use various online sites to browse for the right used car. Search for the brand and model you are most interested in and try to stay with used CPO vehicles (certified pre-owned cars). You may need to be flexible with your requirements because shopping for a used vehicle means you may not readily find the color combination you initially wanted. Select a few options from different car dealerships in case one dealer cannot assist you. 

#### Step 4: Find the Dealer Ready to Assist

Speaking of car dealerships, some dealers that sell some of the aforementioned luxury cars will often offer lease deals on their used inventory. Look for your desired make and model and ask if there's a lease available on that particular model you want. Many car shoppers don't realize that it's possible to lease a used car. It's less common to lease a used car, but that doesn't mean it's not an option at certain dealerships. As previously mentioned, high-end vehicle dealers are more likely to offer this.

If you walk into a dealership and the car salesman says they cannot assist with leased used car options, then don't be afraid to speak to a manager or even the dealer principal to confirm if they offer leasing options. Since used car lease agreements are still relatively rare, the person you first dealt with may have been unaware of possible used car leasing options. 

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#### Step 5: Get the Quote

Once you have found a dealership willing to assist with a used car lease contract, ask them for a quotation, and don't be nervous about negotiating for a fair purchase price. 

Remember to get the residual value if you want to purchase the vehicle at the end of the lease. Then, you must determine the total down payment required and what the total monthly lease payments will be, including the acquisition fees, taxes, etc. 

Finally, there is the interest rate. Many leasing companies and dealers will use a number called the money factor to represent the amount of interest included in the monthly payments. Don't let this deter you from the lease agreement. To convert the money factor to a more familiar interest rate, multiply it by 2,400. 

While obtaining the quotation for the vehicle, contact your auto insurance too for a quotation on the insurance costs for your chosen used car. 

#### Step 6: Always Negotiate

Leasing a car is always a negotiable deal, just like buying one. To calculate what you should be paying each month for such a lease, take the current value of the vehicle you want, subtract what its value is likely to be at the end of your lease and then divide that by how many months your lease will be. That number tells you the potential monthly payment. Sometimes sellers even offer an incentive to have a lease taken over. Other times they'll offer to pay one or two payments to get out of it.

#### Step 7: Get a Good Warranty

For a used car lease, a good warranty is especially important. Used cars are more likely to have problems, and even though you won't own them, you're still responsible for fixing said problems. Make sure to ask about any available warranty when you negotiate the terms. Some vehicles will come with a transferable warranty, and the dealer will likely offer an optional extended warranty.

#### Step 8: Other Available Options - Internet Lease Trades
One interesting option is swapping or trading leases. Various online sites allow you to either take over a used lease or get rid of your current one. 

__Some of these sites include:__

- SwapALease.com

- LeaseTrader.com

- LeaseQuit.com

Taking over a used lease in the form of a lease buyout makes plenty of sense in certain situations; however, you won't typically find a used CPO lease. But, it can help you afford a car that you might not be able to buy outright or even lease new. It also enables you to potentially enter into a shorter contract if you take over a lease that's only a year or so away from the end of the lease term.

#### Step 9: Auto Insurance

We briefly mentioned auto insurance earlier on; let's look at auto insurance as a step on its own once you accept your final lease contract. 

Almost every state requires car insurance, whether it's a new car or a used car lease. Each state has different minimum limits, but usually, the leasing company will want more coverage than the minimum, and their requirements will be laid out in terms of the lease. Liability coverage will usually be around 100,000/300,000, and comprehensive and collision will usually also be required.

The leasing company doesn't usually desire high deductibles as it lowers the odds of the owner getting the car repaired. However, lower deductibles usually also mean higher premiums. If you don't get enough coverage as stipulated by the lease terms, the company will then take out a third-party policy. They will then bill you for the coverage. You will need to add the leasing company as a payee and additional insured when you get insurance coverage. The company is essentially considered another owner.

### Used Car Leasing versus Used Car Buying: The Pros and Cons

You may be wondering why you should or shouldn't lease a used car instead of buying one. There is no easy answer to whether it is better to buy or lease a vehicle because each has its own list of pros and cons. Let's look at the pros and cons of leasing a used car instead of outright buying one. 

#### Pros of Leasing a Used Car

__Low monthly payments:__ Since you are only paying for the depreciation expected during your leasing period with the car rather than the entire cost of the vehicle, you will have lower monthly payments than if you were to purchase the vehicle. The low monthly payments mean you will be able to get a nicer car, extra options, or a higher trim level with the same monthly payment as a vehicle purchase of a lower trim with fewer options. 

__Latest technology:__ Leasing a vehicle every few years rewards you greater accessibility to newer technology features. If you purchase a used car on a budget, you are constrained to your affordability and may need to sacrifice some more recent technology and safety features. 

__Covered maintenance costs:__ With some lease agreements, periodic maintenance costs are covered for part of or for the full lease term. You may pay those costs in your monthly lease price; however, you will have a better predictable total cost of ownership. When you own a vehicle, it is difficult to account for and predict those maintenance costs. 

__Easy trade-in:__ Selling a used car can become a hassle; however, you do have to worry about trading in or selling your used car or the value with a lease. At the end of the lease term, you can return the vehicle to where you got it from. 

__Save on sales tax:__ Though sales tax policies vary from one state to another, leasing a car instead of purchasing one can you save quite a lot of money in sales tax. In some states, you only have to pay sales tax on the amount of your down payment, plus the total of all of the lease agreement's monthly payments. You are typically liable for sales tax on the full purchase amount, less any trade-in value when you buy a vehicle. 

__Smaller down payment:__ Many leases come with smaller down payments than what you may pay when purchasing a vehicle. 

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#### Cons of Leasing a Used Car

__Below are some of the cons of leasing a used car instead of buying one:__

- You do not own the car.
- There are mileage limits.
- You always have a monthly car payment.
- You cannot customize your vehicle. 
- You won't get any cash when you trade-in. 
- There may be some surprising fees at the end of the lease.
- There are various restrictions on how you use your leased car.
- If you have a bad credit score, you may not get a lease. 
- You will need gap insurance. 
- You cannot fix your vehicle anywhere. 
- A lease agreement is a binding contract, and you need to return the car in excellent condition. 

### Leasing a Used Vehicle Versus Leasing a New Vehicle

You may find yourself torn between leasing a brand new vehicle or leasing a used vehicle. One of the key differences car shoppers will face is that used cars come with a much lower purchase price compared to new cars. This means leasing a used car will carry lower monthly payments. 

__Benefits to leasing a new car:__ 

- There is no previous history, so you don't need to worry about its past and prior owners. 
- It is easier to lease a new car because you don't need to spend time researching the car's history, and there is no need for pre-lease inspections. 
- There are often more specials on new cars than on used cars, so you may be able to lease a new vehicle at a special price. 
- Leasing a new car gives you more accessibility to the latest technology available on the automotive market. 
- If you lease a new car, you may unexpectedly save a little money since new cars are typically more fuel-efficient. 

__Disadvantages of leasing a new vehicle and why you may choose a used car instead: __

- They are expensive since the average new car costs more than $39,000. 
- New cars cost more to insure.

### So, why would you turn to a used car lease instead? 

They are less expensive and have lower monthly payments. Leasing a used car also has lower auto insurance costs. 

Because used cars are less expensive to lease, you will be able to afford a better car if you are on a budget than you might have otherwise been able to lease new. 

You will not take a huge depreciation knock. 

A used car may come with previous history, but with online technology, it is easy to check on a car's previous history before leasing it. 

Leasing a used car is much less common than leasing a new car, but it can be done. Find out about lease swaps and leasing high-end used inventory.

Can You Lease a Used Car?

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