Should I lease a new car to get out of my upside-down car loan?

Upside-down car loans are unfortunately quite common among drivers. If you’ve found yourself in this situation, you are likely looking for the best solution to get yourself out of the upside-down car loan. Leasing a new vehicle is a smart solution that is often overlooked by drivers and, depending on your situation, it could be the answer you’re looking for–especially if your vehicle needs repairs or you need a different type of vehicle. Continue reading to see if leasing a new car to get out of an upside-down car loan is the right choice for you.

Leasing with an upside-down car loan

Leasing a new vehicle can potentially be the perfect solution to getting rid of an upside-down car loan if you need to get behind the wheel of a different vehicle as soon as possible. Most dealerships will take your current vehicle as a trade-in, pay off the remaining balance of the car loan, and get you into a lease contract right away. Leasing with an upside-down car loan is smart for a few reasons:

Interest-Free Loan Repayment | You will no longer be paying interest on the remaining balance of your loan since it’s rolled into the lease contract with fixed monthly payments. At the end of the contract, your loan will be paid off and you won’t owe any more money for the lease (unless you are charged for damage above normal wear and tear).

No Unexpected Repairs | Leased vehicles are fully covered under warranty, so you can save for a new car instead of spending money on expensive repairs if anything were to go wrong.

Quick and Convenient | The leasing process is quick and easy, which can be a lifesaver in certain situations. You may even be in and out of the dealership in the same day. Then, after the lease contract expires, you’ll be free to turn in the keys debt-free and start over with a clean slate.