Yes, you can technically downgrade a car lease, but it's often a complex and expensive process, not an official option offered by leasing companies. The most common method is a lease transfer or lease assumption, where you find someone to take over your lease payments. This is your best bet if your current vehicle is too expensive.
The feasibility depends heavily on your leasing company's policies. Some, like Hyundai Motor Finance and Chase Auto, explicitly prohibit transfers. Others, like those from Ally Auto and Toyota Financial Services, allow them but charge a transfer fee, typically ranging from $50 to $500. You'll also need your credit and the new lessee's credit approved by the lender.
| Leasing Company | Lease Transfer Allowed? | Typical Transfer Fee | Early Termination Fee (for comparison) |
|---|
| Toyota Financial Services | Yes | ~$500 | Often equals remaining payments |
| Honda Financial Services | Yes | ~$500 | Varies by contract |
| Ally Auto | Yes | ~$125 - $150 | Calculated based on remaining value |
| Hyundai Motor Finance | No | N/A | Can be several thousand dollars |
| Chase Auto | No | N/A | Stipulated in contract |
Before proceeding, compare the cost of a transfer against the early lease termination fee. Sometimes, paying the fee is simpler. If you're downgrading due to financial strain, contact your lender directly. They may offer a hardship program, which could temporarily lower payments or facilitate a voluntary repossession, though the latter severely damages your credit. A lease transfer is generally the most credit-friendly path, as it legally removes your obligation once approved.
