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Car/Vehicle Lease Termination Letter (Free Template)

When a buyer leases a vehicle, he/she agrees to deposit regular payments to the dealer, follow a scheduled maintenance plan and keep the vehicle until the end of the contracted period. However, due to unexpected changes in lifestyle, or boredom with the vehicle, the buyer might consider terminating a lease agreement before the term. This may come with substantial penalties and fees as lease agreements are not designed to be broken. Terminating the lease agreement early is all about costs, and it is not cheap.

But even so, with proper vehicle preparation and choosing the right time to terminate the lease, it is possible to end the lease agreement early with minimal or sometimes no penalty fees.

It can be done by writing a proper vehicle lease termination letter.

The vehicle lease termination letter is addressed to a car dealer or a motor vehicle finance company to inform them of the lease agreement’s termination between the individual (buyer) and the dealer or the company head.

The vehicle lease termination Letter is sometimes referred to as a vehicle Lease Termination Letter.

Termination of the vehicle lease agreement may be a result of various reasons. For instance, the agreement period is completed, or the customer was not satisfied with the vehicle’s performance.  Maybe, the buyer found a better option in leasing a different vehicle, or due to unexpected lifestyle changes that forced the customer to terminate the lease agreement early. In either case, the customer or the person writing the letter must give a clear and valid explanation as to why he/she is terminating the lease. Usually, this is to make the dealer/motor vehicle finance company head understand your intention and consider your application.

But how do you terminate your car lease? The primary step to take is to write an vehicle lease termination letter.

How to Write a Vehicle Lease Termination Letter

It is important that you understand how to write a well-crafted and all-inclusive vehicle lease termination letter to make it compelling and convincing to your letter’s recipient.

The following is a well-thought guide on how to write the letter:

Gather the lease paperwork and go over it

While writing a vehicle lease termination letter, the first and most important step is to gather up all the lease paperwork and analyze it carefully. In most cases, the lease itself will provide you with the information that you’ll need to include in the letter and any other details that you may need. Additionally, it will outline the required early termination fees or penalty, and whether or not there are other options to help you get out of your lease agreement.

Gather evidence of the reason for termination of the vehicle lease

The second step involves gathering any paperwork that may back up and validate your reason for terminating the car lease. This could be an employment termination letter, deployment paperwork, or some letter from your current employer or the Military indicating that you need to move and where you are moving to.

Attaching copies of this evidence alongside your lease termination letter can help you validate your reason for terminating the lease agreement earlier, thus making it easier for you to terminate the lease.

Writing the actual letter

After you have gathered and analyzed the lease paperwork and collected enough evidence backing up your reason for the lease termination, it is time for you to write the actual lease termination letter. It is important to note that the letter is going to a company that probably receives hundreds and hundreds of documents every day related to various vehicle leases, among other issues.

Therefore, ensure that you include all the pertinent information that the company could need to identify your lease and link it to your vehicle lease termination letter.

Important information that should be included in your vehicle lease termination letter include;

  • Your full legal name, as was initially written in the car lease agreement
  • Your official address, including email and mailing addresses
  • Your telephone and cellphone number, if applicable
  • The Vehicle Identification Number (VIN)
  • Personal account number
  • Vehicle lease start and end dates
  • A valid reason for terminating the car lease agreement
  • A list of attachments, for example, proof of deployment, employment termination letter, or a letter indicating that you will be moving and to.
  • Preferred contact method
  • A request for approval of receipt of the lease termination letter and lease termination

Along with this information, you should also include how you have sent the letter, acknowledging that you need to return the vehicle to the dealership, and include the effective date of termination of the vehicle lease agreement. While writing the letter, remember to follow all the instructions and include all details in the letter as specified in the car lease agreement.

Outline your obligations as you understand them

Often, the vehicle lease outlines the obligations of each of the involved parties while terminating it. This may be (for the buyer)- returning the car to the dealership, paying early termination penalty fees, etc. As a buyer, if you have any obligation that can be done with the letter or without it, specify your intention to comply with that obligation and the effective date.

Provide an odometer reading statement

According to most state’s federal laws, the buyer should include a signed odometer reading statement of the vehicle at the time of the car lease termination. Ensure that you mention in your letter that the odometer reading statement has been attached on a separate piece of paper. This information should be included in the last section of your letter, just before you thank the reader and sign off your letter.

Vehicle Lease Termination Letter Template


___________ [Your name]

___________ [Address]

___________ [Telephone/cellphone number]

___________ [City, State, zip code]

_____________ [Date on which the letter is written]

To, __________ [Recipient’s name]

_____________ [Recipient’s address]

_____________ [Recipient’s City, State, Zip code]

Ref: Termination Letter for Auto Lease Agreement

Dear ________ [ sir/madam or Recipient’s name]

I am ___________ [ your name] working as a _ [write your designation] in ____[write your company name]. I regret to inform you that I am going to terminate the vehicle lease agreement made between your car dealership company____________ [write the company name] and me dated_______________ [include the year and date of the contract] for the vehicle______________ [write your vehicle identification number and its details].

My main reason for terminating the agreement is_______________ [mention the reason]. I am unsatisfied with the performance of the vehicle, which led me to make this decision. Because I paid 75% of the amount as the agreement was being made, I would appreciate it if the money was returned in full. (write this statement if you are unhappy with the vehicle’s performance and recently entered the agreement).

(if the agreement period is over and you are happy with the vehicle’s performance, including the following statement). As the auto lease contract period is over, I would like to terminate it. I must acknowledge that I was very impressed by the vehicle’s performance throughout the period.

I would like to terminate the agreement effective on __ [date] of [month]. I will submit all the paperwork given by you at the time of the contract without fail.

Best regards,

_ [your name]


Vehicle Lease Termination Letter Sample

Irene Clarkson

467 Wood Avenue, Kilimani

457 890 3462

[email protected]

February 13, 2021

XYZ Motor Dealers,

P.O.Box 1334,


Dear Sir,

I am writing to enlighten you that I have to terminate my car lease, which started on January 8th, 2020, and is scheduled to end on July 15th, 2021 early.

I just lost my job, and I have had to take a significant cut in pay and move out of Nairobi to find employment elsewhere.

Given this reason, I am returning the blue 2014 Subaru Forester, VIN#16AB37CD52EF87GH10, to XYZ Motor Dealers company. My account number is 78902145

I have attached a termination letter from my previous employer indicating my job loss and a letter from my new employer specifying my current pay and the need to move out of the city. I have also included the signed vehicle odometer reading statement as required by the Kenyan Federal Law.

I comprehend that I am obliged to pay an early termination fee of $500. I am also well aware that I should return the car to your company within 21 days of this letter’s date. I will comply with these obligations no later than March 1st, 2021. The lease termination will be effective on March 7th, 2021.

I am sending this letter via verified mail with a return receipt requested. Kindly confirm receipt and that the lease has been terminated at your earliest convenience. Thank you.


Irene Clarkson

Free Lease Termination Letter Templates

Use our free vehicle lease termination templates to help you get started on writing your vehicle lease termination letter. Our templates are customizable and downloadable. Just personalize them to fit your unique requirements and print them for use anytime.







    Tips to Follow

    The tips listed below will help you craft a convincing and winning car lease termination letter that will probably get you out of a lease using minimal penalty fees.

    • Include details. It is vital that you make your letter as detailed as possible to avoid confusion and misunderstanding amongst the involved parties. Ensure that you add all the necessary information as is specified in the car lease agreement.
    • Provide a clear and valid reason for termination of the agreement in a polite way if it is due to vehicle under-performance, mention that in your letter but politely and professionally.
    • State the agreement made between you and the dealer along with the dates. That is the start and end dates of the contract period.
    • Mention the effective date of your lease termination and make sure you leave a time gap between writing the letter and the termination date, to allow the recipient of the letter time to consider your application.


    Car lease termination is not easy, and it is always associated with extra costs. However, sometimes it is just inevitable. For this reason, you should know how to write a car lease termination letter that serves your interest and goes a long way in convincing the car dealer to allow you out of the lease without paying any penalties or termination fees. This article has been very informative on how to write a car lease termination letter regardless of the reason and tips for writing an effective termination letter.

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