Read your car lease agreement before breaking car lease 

Facing areas in our life where we have no control and facing unforeseen hardship, including the state of our finances, are common things today. Many of these hardships mean we have to do some creative restructuring and find resolutions that may not be easy or comfortable.

One area of difficulty many are finding themselves in is breaking car lease contracts without destroying their credit.

Having full knowledge of and understanding your car lease agreement will give you more insight as to how you can survive financially when breaking car lease contracts.

Leasing has many benefits and is why it is a popular choice for many people; one benefit is the low monthly payments.

The low monthly payments of leasing a car allows people to drive a car they would not be able to afford if buying.

The draw to drive a Mercedes, Lexus, Toyota or even a Hummer is pretty tempting to a lot of people.

Naturally other cars provide lower monthly payments as well, luxury may not be what drives you, it may be necessity and therefore you sign a car lease agreement for a Caravan or a Ford Focus.

What ever car you choose to lease, the moment you drive it off the lot it will begin losing value or rather depreciating; some faster than others. The monthly payment you pay for in a lease in part pays for this depreciation and when you return the car before the depreciation cost is covered the leasing company loses money.

This is why breaking car lease agreements can be tricky and down right difficult to do. Sure, you can choose to pull into the leasing company, drop off the keys and walk away without paying the rest of the contract along with the penalties but your credit will suffer greatly for it. There are more viable options if you find yourself unable to keep your leased vehicle.

Your car lease agreement holds you to a commitment to lease that car for a specified amount of time with a specified amount of money that has been spread out over the length of your contract.

If you return it early you will still have to pay the specified amount of money as well as possibly early return penalty fees. Additionally, all leased vehicles will have a buy off price, the price you will pay if you choose to buy the car you are leasing.

A viable option to returning it and paying for a car you no longer drive or walking away as your credit score shrivels up is to sell the car and use the money you receive to apply to the buy off amount of the car.

You will probably have to put some of your own money with it to make up the entire amount but it will hopefully be less than paying off the contract.

This option will keep your credit intact and resolve your problem. If; however, you have not leased the car long enough and the car has depreciated so much that the sale price comes nowhere close to the buy off price you may want to look for a different option.

A lease assumption by a third party may be a better option for you. This option will take thorough paperwork to be valid and legal, but it is possible and there are companies in most metropolitan areas including the Portland area that can help with lease assumption transactions.

These companies will match people looking for short term leases with people needing to get out of their lease. There will likely be fees involved in this transaction, but again it will be less than paying off the contract.

If you default on a car lease and do not make good the contact company, you may end up with bad credit history.  This will close a lot of doors for you as no credit check car  leasing companies are often much more expensive.