Lease agreements for vehicles typically include mileage limitations. Exceeding these limits, often set at or below 10,000 miles annually, results in additional charges at the end of the lease term. For instance, if a lease stipulates a $0.25 per mile overage fee and a driver accrues 12,000 miles in a year on a 10,000-mile-per-year lease, they would owe for 2,000 extra miles, totaling $500. This cost is separate from the vehicle’s depreciation and any other end-of-lease fees.
Mileage limitations are a key factor in determining the lease’s monthly payment. Lower mileage allowances generally translate to lower monthly payments, making leases attractive to individuals with predictable, limited driving needs. Historically, these limitations were established to protect the leasing company from accelerated depreciation of the vehicle, directly impacting its resale value. Understanding these limitations is crucial for lessees to avoid unexpected expenses upon returning the vehicle.
