If you’re on the hunt for a relatively recent pre-owned vehicle, an off-lease car or SUV can offer some unique advantages. Generally speaking, you can count on them to have less mileage and more content than run-of-the-mill used cars, and they’re often in pretty good shape. We’re also at the stage where more and more of the available off-lease vehicles are from the most popular segments for new vehicles. That’s because the people who first leased those products a few years ago had already started switching their preferences to trucks and SUVs.
That’s obviously good news if you’re shopping today. We’ve also got some less obvious things to keep in mind when buying an off-lease vehicle.
What Are the Benefits of an Off-lease Vehicle?
The main reason that off-lease vehicles can be such a good deal is that they were leased in the first place. In fact, you can think of a new-vehicle lease as a contract for creating a high-quality used vehicle. Consider a recent offer for a new Ram 1500. A four-wheel-drive Bighorn model was available at a special price with a lease term of 24 months and annual mileage limits of 10,000 miles a year. Every time that kind of lease expires, the used car market gains a well-equipped two-year-old pickup with less than 20,000 miles on it. Further, since leases have strict requirements for upkeep, it should still be in close-to-new condition. Those are all great selling points for a used vehicle.
Warranty coverage can be another important factor if you’re looking at an off-lease vehicle. Now, many dealerships will sell you extended warranties on all sorts of used cars, but a previously leased one is more likely to qualify for standard warranty coverage. Newer used cars, such as those coming off a 2- or 3-year lease, may still retain a good chunk of their original factory protection. Also, since off-lease models are usually so well-kept, they’re easier to recondition as a certified pre-owned (CPO) vehicle. These will often include special coverage as part of a brand’s overall CPO program. At Mercedes-Benz, for example, CPO vehicles are covered by 24/7 roadside assistance. Mainstream companies like Kia provide a CPO-specific limited powertrain warranty that extends for 10 years/100,000 miles.
What Should I Look for in an Off-lease Vehicle?
As with any used car, you should carefully check out any off-lease vehicle before spending your money on it. This includes getting a Carfax Vehicle History Report, which can be especially helpful in these cases. All of those previously mentioned benefits can make off-lease cars more expensive, so you want to be sure you get what you pay for. A Carfax report lets you do exactly that since it can verify the number of miles on the odometer along with the number of times it’s been in for routine service. The information can even let you verify that the car was actually leased. Ask the dealer what the original lease terms were, and if the Carfax mileage and service data don’t match up with what you’re told, you may want to move on.
The next step in the car-buying process is the test drive. This is your opportunity to see how the vehicle performs when you’re behind the wheel. You should also be sure you’re comfortable with the car’s technologies and features, and that they work the way they’re supposed to. This is particularly vital when buying a car with newer infotainment and safety technologies. So if the vehicle you’re testing has Bluetooth, Android Auto or Apple CarPlay, you may want to try pairing your phone to the system. In addition, you can easily check safety features like a rearview camera, adaptive cruise control and blind-spot systems without taking risks.
Nor would it hurt to have the car inspected by an independent mechanic. Off-lease vehicles should be free from major problems once they’re back on dealer lots, yet there is some truth behind the old Russian proverb “trust, but verify.”
What about Buying Back My Own Off-lease Car?
It can also make sense to buy an off-lease vehicle when you’re the original lessee. After all, if you already like a car, and you’re familiar with its history, why go through all the hassle of finding a replacement? True, you will have to take into account any buyout language and fees in the original agreement, but you do enjoy some negotiating advantages. These include the fact that the dealer won’t have to pay to have the car reconditioned for someone else, which can cost hundreds of dollars.
You can save yourself some money as well. If you’ve gone over your lease’s mileage limit, or your car’s gotten too many dents and dings, you’ll probably have to pay extra fees when you turn it in. Buying the vehicle instead can be a smart strategy for getting around this, and you’ll still end up with a car to get around in afterward.
Editor’s note: This article was originally published in February 2018. It has been completely updated to convey the most accurate and comprehensive information.