How this number is made
A lease charges for miles above the allowance, at a cents-per-mile rate in the contract. The charge is due at the end if you do not buy the car. Buying the car can make the penalty irrelevant. This page is only the penalty.
- Miles allowed are the term allowance, such as 12,000 a year times three years.
- The charge per mile is in the lease, often 15 to 25 cents. Type yours.
Formula
Penalty = extra miles × charge per mile.
Worked example
With the figures already in the form, mileage charge is $1,000.00.
Questions
Should I buy extra miles up front?
Only if the prepaid rate is cheaper than the end-of-lease rate and you are sure you will use them. Unused prepaid miles are usually not refunded.
What if I buy the car?
The mileage charge typically disappears because you are buying the residual, not returning the car. Confirm the contract.