In What Condition Do You Have to Return a Leased Vehicle?

Dealerships allow some wear and tear over the course of a lease, but major damage, high mileage, or neglected maintenance can be costly.

Andy Stonehouse | 

Jan 7, 2025 | 3 min read

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All good things must come to an end. A lease can be an attractive way to have a new vehicle for a short period, but you'll eventually be required to return it to the dealer or leasing company at the end of the financial term.

While leasing agencies generally allow normal wear and tear on a leased vehicle, you can be hit with substantial charges if you've put off regular maintenance, racked up miles, or incurred serious damage during your lease.

Understanding How Leases Work

A lease agreement is basically a long-term rental, meaning that the leasing company retains ownership throughout and expects the vehicle to be in good shape when it is returned. The agreements you initially signed in the leasing office will generally provide a list of the kinds of daily wear and tear that are acceptable over a lease term, and will also set out standards for vehicle maintenance and an allotted mileage total.

Wear and tear includes minor, day-to-day damage such as scrapes or dings in your vehicle's paint or paneling. According to Ford Credit Finance, acceptable wear and use includes minor scratches on headlights, taillamps and wheels, small interior stains, and cuts and small tears in carpets or upholstery.

More Extensive Damage Needs to Be Fixed

If there's more significant damage, the lease agreement will require repairs to be made. Those can include items such as cracked windshields, significant dents or paint damage, as well as unrepaired body damage from an accident.

Missing parts and major fabric or carpet damage can also constitute excessive wear and tear; even bumper stickers can count. You may want to have these repaired before you turn the vehicle back in, or you'll likely be billed extra for the leasing company to make the fixes.

Tires wear differently depending on your driving style, and you might need to replace them if the tread is too worn at the end of your lease. Depending on the lease, you may also be required to show proof of completing regularly scheduled oil changes and other vehicle maintenance. If you've neglected those, you could incur extra charges.

Mileage Matters in Final Lease Costs

Mileage is a key factor in leases, as restricting it is one of the ways leasing companies guarantee their vehicle will retain more of its value. If you've been mindful in budgeting the right amount of mileage, you've probably kept on track with your agreed yearly totals. If you've gone over the caps, however, expect to pay a fee for every mile you've exceeded.

Dealerships May Have a More Lenient Approach

The rules set out in your lease agreement are legally binding, but you may be able to catch a break for some wear and tear or even additional mileage if you agree to lease another vehicle from the same dealer or leasing company.

Dealerships may encourage you to swap into a newer vehicle before your lease expires. Under those circumstances, they might be more willing to overlook minor scrapes or wear in an effort to keep your business, which could be an avenue worth exploring.

Andy Stonehouse

Andy Stonehouse literally fell into the world of auto writing while working as a ski-town journalist, and has not looked back since. A childhood spent dealing with the eccentricities of a 1976 MG Midget has made any subsequent auto experience a more safe and reliable drive. He has been blessed with nearby mountain trails and snowy roads in Colorado to do TV-adventure-styled test drives on a weekly basis.