What to do with a leased vehicle in divorce
Divorce is a stressful process, and that's before you factor in the financial impact of dividing assets. For example, if you're getting divorced and your spouse has a leased vehicle, what happens to it? It's probably best not to hold on to something like that — but you may need an alternate solution. Here are some options:
Get your name off the lease.
The first step to take is to get your name off the lease. This can be done by contacting the leasing company and asking them to release you from any obligations under the contract, which means that you no longer have to pay for the remaining payments on the loan or for any insurance premiums. The sooner you can do this, however, the better, because some companies require you to pay off any outstanding balances before they will release you from a lease agreement.
If at all possible, try to get back into full possession of your car before its end date arrives so that no more payments are made after that date—you don't want more money going out of pocket! If this isn't possible due to some extenuating circumstances (like if there's an issue with transferring ownership), then try anyway when it comes time for renewal at least; otherwise, it'll just keep happening every few years until things start getting tricky too late in life when maybe nobody wants another vehicle anymore anyway? You've got plenty enough on your plate already so let's try not to make things worse than necessary here...
Transfer to a new lease.
If you leased the vehicle with your spouse, you can transfer the lease to a new lease with a new co-signer. You should also consider transferring your lease to a new lease with new terms and mileage limits (if it's still under its original mileage limit). This is particularly helpful if you're planning on driving more than 10,000 miles per year in the car or if you want unlimited miles on your next lease contract.
If possible, transfer ownership of any other vehicles that you own jointly with your spouse before filing for divorce.
Buy out the car.
If you are going through a divorce and have a leased car, the best thing to do is to buy out the car. This allows you to either keep it, sell it or trade it in for a new vehicle. There are several ways that you can buy out your ex-spouse's portion of the lease:
You can pay off his/her share of the remaining lease payments with cash.
You can take over his/her remaining payments by paying an additional amount each month on top of your current payment.
You can trade him/her into another vehicle with similar or lower monthly payments, if possible. If not, then he/she will have additional monthly payments since yours are already paid off!
Reimburse each other for equity.
If you can't sell or trade in the vehicle, consider assigning it to a third party. You'll still be responsible for making payments on the loan until that person pays off the entire principal balance.
Next, if assigning the car to a third party isn't an option, reimburse each other for any equity you have in it by either assigning title directly or paying cash directly. You can also reimburse each other with cash if selling or trading isn't possible and that's what makes the most sense based on your circumstances.
If you're confident that your former spouse won't attempt to come after you for the money, consider selling the vehicle to a private buyer. This may prove tricky if he or she is still living in the same area as you, but otherwise, it's a good way to make a few bucks and get rid of an extra vehicle at no cost.
If your former spouse is willing to sell the vehicle back to its original owner, this could be an option for both parties involved (as long as there's no outstanding loan on it). However, if either party has made upgrades or alterations without informing their partner from whom they acquired them, this would also require some careful negotiation in order for both parties involved not only to agree but understand one another. Such negotiations would need scrupulously detailed documentation about what was done before and after which parties had possession over the said item(s) so that all parties can be satisfied with any proposed agreement moving forward from here on out."
Trade it in for a new vehicle.
There are many reasons why you might want to trade in your leased vehicle for a new one. For example, maybe the car you’re driving doesn't have all of the features that you need or want, such as:
More fuel efficiency.
Greater safety features (such as airbags).
A more comfortable ride.
Luxury amenities like leather seats and heated seats for winter driving.
It's best not to keep a leased vehicle after you divide assets from your divorce unless you can afford it.
If you can afford to keep the leased vehicle, it’s best to do so. But if you cannot, then there are two options for getting rid of it:
Sell the vehicle yourself. If you want to get some money back from your lease, sell it on Craigslist or advertise in local newspapers, magazines, or online vendors about your sale. You may be able to list the car at a higher price than what is owed on the lease — but this depends on how many other people in your area would pay for a similar model and year as well as how much interest has been accrued through payments made already (this is called capitalization).
Trade it in for another leased vehicle. Some leasing companies offer incentives such as discounted monthly payments or free maintenance services if they approve an early termination of your lease contract so that they can sell off their remaining inventory during slow periods like summertime when fewer people are looking for new cars or trucks; others do not have these programs but will consider doing so anyway if given enough incentive (such as making up lost profits).
If you can afford to keep a leased vehicle after your divorce, then by all means, go ahead and do it. Just make sure that you're aware of the financial responsibilities that come with having this kind of car. It's best not to keep a leased vehicle after you divide assets from your divorce unless you can afford it