Key takeaways
- A short-term car lease is typically for two years or less.
- You may be able to negotiate with the lessor directly or take over a lease from someone else.
- Short-term leases can help you avoid paying for the initial depreciation of a car.
- Short-term leases may have a higher monthly payment than a lease with a longer term.
Pros and cons of a short-term car lease
But a short-term lease has a few drawbacks. The monthly price tag on a short-term lease can be much higher than a standard lease. There are two reasons:
- Vehicle depreciation: New cars lose between 6 and 45 percent of their original value in the first year. A good portion of your lease payment covers vehicle depreciation. A vehicle’s residual value is proportionately less in the short term, which will cost you more.
- Shorter terms typically result in higher monthly payments: This is because you are cramming the same cost into two years rather than three or four. Month-to-month, that means you pay more — and you still pay sales taxes and fees in many states.
For new leases, the most common terms were 35 or 36 months, according to data from Experian. The fact that short-term leases are uncommon can be another drawback. You will need to scour dealerships and negotiate to find lease options for less than three years.
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How to get a short-term car lease
Although short-term leases are not common, the process of getting one is functionally the same as a standard lease.
- Research your options: Find a dealer that offers short-term leases or is willing to negotiate. And, of course, find a dealer that has the type of vehicle you want to drive.
- Negotiate the lease contract: On top of ensuring a short term, negotiate common costs like the disposition fee, mileage allowance and sale price.
- Compare offers: If you can find multiple short-term lease deals, compare them closely. Monthly payment and end-of-lease fees will all impact the total cost.
Most importantly, avoid common leasing mistakes. Always know how much your monthly payment will cost, and be prepared to negotiate and estimate how much you will drive when you enter into a short-term lease.
Alternatives to short-term auto leases
While you can certainly negotiate a short-term lease with a dealership, there are other ways to drive a car for less than three years.
1. Take over someone else’s lease
Most auto manufacturers will allow another person to take over a car lease from the original lessee who wants out of their contract.
While this can be done between two individuals, it may be easier to use a third party, such as SwapALease or LeaseTrader. These services pair current lessees with those looking for a short-term car lease. You may also have more luck finding someone depending on your state — Michigan, New York and New Jersey were the states with the most leases in the third quarter of 2024, according to data from Experian.
Getting a short-term lease through a lease transfer allows you to avoid making a down payment. In addition, your monthly lease payment would be the rate that the original lessee negotiated for when they started their lease term. This can save you a lot of hassle, although you won’t be able to renegotiate any less favorable terms, like wear-and-tear fees and mileage overage charges.
2. Exit a standard lease early
If you can’t find a suitable short-term lease, you may consider a standard term that you end early.
You can use third-party services to hand your lease off to a new lessee. However, you need to be sure your lessor allows this from the get-go — it won’t matter if you can find someone if it violates the terms of your lease.
3. Get a long-term rental
Many rental car companies offer long-term rentals, which are effectively short-term leases and are sometimes called “mini leases.” They offer certain advantages:
- Flexibility: Because these are car rentals and not leases, you’re not locked into a contract and can return the vehicle at any time.
- No mileage limits — most of the time: Unlike when you lease a vehicle, there are usually no mileage restrictions when you opt for a long-term rental. But this may not always be the case, especially when it comes to specialty vehicles.
- Change cars at will: Car rental companies often allow renters to switch cars during the term, giving you the opportunity to drive more than one vehicle.
On the downside, while the rates are lower than a normal car rental rate for a few days or a week, long-term car rentals are still typically more expensive than a lease takeover.
Bottom line
A short-term car lease can be an attractive option if you don’t want to commit to one type of vehicle for a lengthy period or you need a vehicle temporarily.
But shorter terms often come with higher prices. Before deciding on a short-term car lease, shop around at multiple dealers to find the most competitive contract and compare costs with long-term rental options as well.
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