How and When You Can Lease a Used Car

Most people think of car leasing in terms of new cars, but many have wondered, "Can you lease a used car?" While it's not as popular as leasing new vehicles, dealerships are more frequently offering used car leases. These leases are usually available for vehicles that have come off a previous lease and are labeled by the dealership as certified pre-owned cars.  

Remember, before you drive any new or used car off the lot, make sure you're equipped with the right car insurance. An independent insurance agent can help you get the coverage you need. But first, we'll break down the basics of used car leasing so you can decide if it's right for you. 

Where to Get a Used Car Lease

Used car leases usually aren't as easy to find as new car leases. Typically, you can find a used car lease through a franchise dealer (i.e., a dealer that just sells one car brand). These are the only sellers that can sell legitimate, certified pre-owned vehicles. 

Another option is to take over an existing lease. There are online services that allow current leaseholders to list their vehicles and match them with someone who's looking to take over a lease. If you go this route, you'll have to get approved by the leasing company, as well as pay a transfer fee. But you can also likely avoid having to make a big down payment. 

How Does a Used Car Lease Work? 

Assuming you lease a used car from a dealership, it'll work just like a new car lease. You'll likely have to make a down payment and pay an acquisition fee upfront. Then, you'll have to make monthly payments for the term of the lease.  

Lease payments are based on the difference between the car's purchase price and the car's estimated residual value at the end of the lease. When the lease is over, you'll likely have to pay a few fees in addition to any penalties that are due if you exceed the mileage limits or have created excess wear and tear on the vehicle. 

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When Is Leasing a Used Car a Good Idea? 

Leasing a used car usually leads to a lower down payment. But you're also limited to the term of the lease. If you want to keep a car longer than a few years, buying is usually the way to go. 

Leasing a Used Car: Pros and Cons

Leasing a used car isn't the right choice for everyone. Weigh the pros and cons below to help determine if you want to lease a used vehicle.

Pros:	Cons:
You can get a lower monthly payment than with a new car lease or purchase.	Used cars always have a certain level of wear and tear.
You can get a better car with lower monthly payments than you would otherwise.	A used car might be without the latest technology and safety features.
Certified pre-owned cars usually come with a manufacturer's warranty, where other used cars do not.	You'll need to keep up with the leasing company's maintenance plan to satisfy your lease requirements.
You can often buy the used vehicle for an affordable price at the end of the lease term.	There is a limited inventory of used cars available for lease.
Car insurance is likely to be more affordable for used vehicles than new cars because of their lower value.	Leases come with additional risks like fees for going over the agreed upon mileage.

You might also want to ask friends, family members, or other people you may know who have leased used vehicles before. Get the details of what the experience was like for them, and if they'd recommend it. If not, be sure to ask why.

While a used car lease can come with more risks than buying the car outright or leasing a new vehicle, it might be exactly the right choice for you. Used car leases can offer you an affordable way to buy the vehicle at the end of the lease and allow you to drive the car you really want with lower monthly payments than if you'd bought it. Overall, there are several factors you'll want to weigh when deciding whether leasing a used car is right for you.

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How an Independent Insurance Agent Can Help You Insure Your Used Car

Whether you decide to lease or buy, any new or used vehicle needs the proper car insurance. An independent insurance agent can get quotes from multiple car insurance companies, so you get the best coverage for your needs. Your agent will also provide personal service when you have a car insurance claim and any time your insurance needs to change.