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Tips on How to Stay Under Lease Mileage

A close-up to the velocimeter of a car's dashboard to illustrate tips to keep mileage low with leased vehicles.

When it comes to buying or leasing a new car, sometimes leasing is the better – and cheaper – option for certain consumers. However, to avoid hefty charges for going over your vehicle mileage limit before the end of the contract, drivers must learn to drive less. The fee for each mile over the limit might seem insignificant, but it can easily add up over the course of two or three years. To protect yourself financially from such unexpected charges, it is important to review your auto insurance policy to ensure you have adequate coverage in case of such contingencies that might arise during your lease.

Here are some tips to help you drive less and save hundreds, or even thousands, of dollars by staying within your  mileage limit.

What are the Advantages of Leasing?

There are several advantages to leasing over buying, but keep in mind that, in the long run, you are renting. The monthly payments you put towards your auto every month aren’t going to result in you owning that car or truck. That said, for some people, leasing is an attractive option.

·         A New Car Every Few Years

If your gig is that you want a new set of wheels to drive every few years, leasing is for you. Whether you have a lease term through a dealership or a leasing company, you’ll have the latest model of that year. You’ll never have to worry about an older automobile that’s starting to need repairs and expensive maintenance.

·         You Can’t Afford to Buy a New Car

If you really want a new set of wheels, but you cannot afford it, leasing may be an option for you. With little to no down payment and smaller monthly payments, you can still have that latest year model with all the bells and whistles.

·         A Small Down Payment and Smaller Monthly Payments

You won’t be paying additional charges for things like interest on a vehicle loan. Some leasing companies don’t require any down payment. Plus, your monthly payment will be smaller since you are only paying for depreciation.

What are the Rules of Leasing?

You’ll need to go into contract with some agreements in place besides the amount of your monthly payment. Whether you work with a dealership or a leasing company, there will need to be some agreement on:

  • The term (the number of months)
  • The number of miles you are allowed to drive each year
  • What constitutes normal wear and tear
  • What money will be owed if there is excess wear and tear
  • What the auto is worth at the beginning and the estimated worth at the end of the lease
  • Any money you will need to pay at the lease end
  • What additional charges may be added, for example, if you return it early
  • What happens if there is a wreck in the leased automobile

As a lessee, you have some bargaining power, but get a good, clear picture of expectations before signing on the dotted line.

Ways to Work with a Car Mileage Limit

Understanding your options – and limits – in a lease agreement is vitally important to avoid getting caught in the over-mileage trap in the first place. Before you sit down with any lease companies, take a look at your expectations and needs and be realistic about deciding how to formulate your case. Here are some tips.

·         Do the Math to Understand Your Annual Mileage Needs

If you walk into a dealer’s office today and sign an agreement, you’ll probably be considering how much money you need to come in the door. But knowing how many miles you will need the car for annually is a much more important consideration. You may have a general (or specific) idea of how much cash you want to spend. If you settle on a vehicle mileage limit and then proceed to go over that before the end of the lease, your cash will be flying out of your wallet.

Here is one way to estimate your need: Come up with as close an approximation as you can for your last 3 years of driving. Divide by 36 to come up with monthly and yearly amounts. You might want to add on an additional 5-10% for longer trips or vacations. This figure and the one in your contract should be similar. If not, keep looking for a more agreeable option, such as purchasing.

·         Use a High-Mileage Lease

A high-mileage vehicle lease will cost more money, but for drivers who know their total miles will exceed the typical agreement, it may be the best choice. A high-mileage lease will generally be for 15,000 to 30,000 miles per year. A normal mileage cap is 13,000-20,000 miles annually. According to experts, if you plan to drive more than 30,000 miles per year, a lease doesn’t make financial sense.

·         Have a Transferable Lease

We cannot always plan for everything, but we certainly try. See if you can negotiate a transferable contract so that if you have to move due to a job loss or other unforeseen event, you can take your lease with you. Also, if you have a transferable clause, you may be able to find someone who will take it over through companies such as or

A man behind the wheel counts his cash to see how much it will cost if he doesn't stay under lease mileage

What Options Do I Have if I Go Over My Mileage Limit?

Unfortunately, going over your mileage allowance before the end of the lease can cost you a lot of money in over-limit fees for extra miles. But there are several options you can consider if you see that you are getting close to having excess miles.

·         Bite the Bullet and Buy

Ask your leaser what your buyout price is today. It may be the purchase price would be cheaper than paying the additional charges for extra miles you’ve racked up. And if you have to pay those, maybe you can use that as a down payment. At least you’ll walk away with a vehicle. With used prices as they are today, you may even end up making a little!

·         Bite the Bullet and Pay

Depending on your circumstances, paying the over-limit fee for extra miles may be your best option. Before you choose this as your way out, do some more math and have a good picture of what you owe today. For example, if your contract says you must pay 15 cents per mile over 15,000 miles and you drove it 17,000 miles, you’ll be owing $300.

·         Turn it In

It’s possible that with today’s shortages, your dealer may work with you to turn in your ride early without a fee. It’s a win-win. The dealer can rent it to someone else (possibly at a higher rate) and you can walk away. Just don’t forget to figure out how you are getting home afterwards.

·         Embrace public transit

Driving to work is probably the single activity that will add the most amount of miles. If you live in a city with public transit options, take advantage of it. Consider taking the bus, subway or light rail to work one day every week. If you’re feeling ambitious, take public transit for an entire week once a month. Regardless of how many days you choose, your mission to drive less will undoubtedly have a wallet- and environment-friendly impact.

·         Swap cars

Depending on your household arrangement, you can opt to occasionally swap with someone who doesn’t have a work commute – or someone whose commute is much shorter than yours. Trading with your spouse, sibling or other relative is one surefire way to drive less on certain days. But in order to cut back on your mileage with this method, just be sure your swapping partner is covered by your insurance policy.

·         Plan ahead

Without even realizing it, sometimes we tend to drive more due to poor planning. To drive less, think about all your errands and try to combine them to make cut down on trips. Sometimes, it’s easy to forget that a trip to the grocery store or dry cleaners is actually walking distance. Not only can walking or biking help you control your vehicle mileage, but it can help you get or stay fit.

There’s nothing quite like driving off a dealership lot in a new set of wheels. But to prevent that smile on your face from becoming a frown when the contract is up, be mindful of your driving habits – if you drive less, you can avoid sky-high charges associated with going over your mileage limit.

Get Affordable Auto Insurance Online Today

If you are leasing your vehicle, and you need an affordable insurance quote, call Freeway Insurance at (800) 777-5620 to get a free quote from a live agent. Freeway specializes in providing quality auto insurance at affordable rates. Call now or get your free quote online.

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