When you think of leasing, you usually visualize driving off in a shiny new car. But what if you want to lease a used vehicle? Can you lease a used car? Yes, you can, but it has some fundamental differences from leasing a new one.

What Is a Used Car Lease?

A used car lease, which is sometimes called a “pre-owned lease,” is very similar to a regular lease. Rather than owning the car, you lease the car for a defined period (usually 2–4 years) and pay monthly payments. At the end of the lease, you return the car, extend the lease, or sometimes buy it.

The primary difference is that you are leasing a used vehicle that someone has already driven instead of a brand-new vehicle. Vehicles that you will typically lease will be certified pre-owned (CPO) vehicles that adhere to specific inspection and/or mileage guidelines.

Benefits of Leasing a Second-Hand Car

• Lower Monthly payments- Since a used vehicle already has some depreciation on it, lessor’s monthly payments will usually be lower vs. a leased new vehicle.
• Decreased Depreciation Rate – New vehicles depreciate quickly in the first few years, and, in the case of a used vehicle, much of that depreciation has happened, so you pay a more stable depreciation rate.
• Certified Quality – Most dealers are sure to only offer lease programs for CPO and inspect the vehicles with limited warranties.
• Possibly Buy the Car for Less – If you have fallen in love with the vehicle, you could have the option of purchasing the vehicle at the end of the lease at a reasonable price.

Cons of Leasing a Second-Hand Car

• Limited Access – Not all dealers will offer used car leases and the selection will be less than new vehicle leases.
• Shorter Warranties – The manufacturer’s warranty could be partially expired resulting in high repair costs if something goes wrong.
• Higher Interest Rates – Used car leases sometimes have higher money factors (the lease equivalent of interest rates) which could contribute to a higher long-term costs.
• Mileage Limits – As well as new car leases, you will most likely face mileage limits if you exceed those limits you may incur unduly expensive fees.

Who Should Consider Leasing a Used Car?

• Leasing a second-hand car may work for you if:
• You want a payment less than a new car.
• You do not drive a lot (to avoid mileage overages).
• You like the idea of switching vehicles in a few years.
• You would like to ultimately purchase the vehicle at a fair price.

On the flip side, if you are likely to keep a vehicle for many years, then buying (either new or used) is probably a better financial decision than leasing.

Conclusion

So can you lease a used car? Definitely—but it is not as common as new car leasing and is subject to dealership availability. If you are looking for affordability and flexibility, then it can be a good option. Just make sure you read all the fine print, check if you’re covered by a warranty, and fully understand the lease before you sign.

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