The lease is over! 

Your car lease is about to end and now after 3 or 4 or 5 years of faithful monthly payments you are going to surrender the vehicle and walk home. Well you probably won’t have to walk, but you won’t have enough equity in the car you paid on for all these years to pay bus fare. And that’s the good news.

Before the lease actually expires and you go to turn in the car it might be a good idea to read the lease agreement. For some this may be the first time that you have read anything other than the payment amounts. Pay particular attention to the sections on your responsibilities when you return the car. There will be something in there relating to “acceptable condition” of the car. On some leases the inspection will be done right at the dealership when you return the car, but in other cases a private company may be used to both inspect and repair the car. In either case take pictures of the car and insist that the dealership inspect the car and give you a copy of that inspection when you surrender it.

Your lease will probably include provisions for the leasing company to notify you if the car is found in need of repairs, and specific procedures and time limit for you to respond if you protest the repairs or charges. If you find it necessary to use this procedure be sure to fully document everything, record the date, time and to whom you spoke for every phone call, send all written material with a signature required return receipt requested. Keep copies of everything.

Recently a friend returned a leased Expedition. We had maintained the car for him the entire time that he owned it and the car was in excellent shape. He dropped the car off at the prescribed dealership and so far as he knew everything was over. Several weeks later he got a bill in the mail for $1700. For “repairs necessary to return the car to acceptable standards”. These included a new windshield, repairs to hail damage and a front fender. The car had no damage at the time it was turned in. He was not notified of the damage before repairs were done, and not given the opportunity to have them done by an independent garage. After several months of dispute he finally settled the claim out of frustration.

The point is that you have to be aware of exactly what is going to be looked at and how your car will measure up to the standards set by the lease company. The lease company may not be willing to give you a copy of what they will be inspecting on the car, or specifically what the minimum standards would be. There are some things that are pretty standard.

Glass. There can be no cracked glass or rock chips in the windshield. If the glass is damaged you want to have it fixed under your insurance before you return the car. Added window tinting may have to be removed.

Tires. The tires must be good enough for resale of the car. About 50% of the tread left is a good rule of thumb, but may vary. If there is damage to the tread area or side walls they will not pass. If they show any indications of wear due to an alignment problem you will be hit for tires and alignment.

Interior. The interior should be virtually spotless. If there are stains on the seats or carpets it will have to be shampooed. I suggest having the interior professionally detailed the day before the car goes back and saving the receipt with the vehicle identity information on it. If you are a smoker the car will have to be de-odorized, BG Products makes a great cleaner for this.

Body. If there are any dents in the car you will be charged to fix them. Most of the typical parking lot dings can be repaired with a “Paint-less Dent Repair” system and this could save you a lot of money. Damage to the paint, scratches, weather fading, or rock chips are going to be charged to you if you do not repair them before returning the car.

Maintenance. Every lease I have seen makes you responsible for the maintenance and upkeep of the car. Be sure to keep all your records to prove that you have done the manufacturers required maintenance. Everything on the car has to work properly, from accessories such as the radio and A/C, to the engine and transmission. If the car is still under a factory warranty get it fixed. If you are under an extended warranty you want to have the repairs done before the car goes back because that extended warranty will not cover it afterwards. If you have no warranty coverage then at least get an estimate of the cost of the repairs so that you will know you are being treated fairly by the lease company.

All of this seems rather burdensome, and can be pretty expensive for a car that you do not own and will not have much longer. It is one of the hazards of leasing a car, and something that you agree to when you sign the lease. I am sure that the salesman who encouraged you to lease that car did not make a big deal of it.
If you have a good relationship with your local mechanic get them to look the car over for you. You may spend a few hundred dollars getting the car ready to turn in, but it will save you grief and money in the long run.