When Hollywood scriptwriter Scott Nimerfro needed a car to bridge stints between his job in Los Angeles and his home in Cottage Grove, Minn., he took over the remaining lease on a 2008 BMW from a stranger.
The two-year lease gave him the snazzy car he craved without a long financial commitment.
As the recession digs in, Nimerfro is on the cusp of a trend. The trading of car leases is growing as more lease holders opt to exit contracts because of job losses, salary cuts and general cost-cutting, say online service firms such as LeaseTrader.com and Swapalease.com, which match trading partners on the Internet for a fee.
“In the fourth quarter of 2007, the No. 1 reason people were getting out of a car lease is because of a mortgage situation. Today, the No. 1 reason is because of job loss,” said John Sternal, marketing vice president for the Miami-based LeaseTrader.com.
With the nation’s unemployment rate topping 8 percent and monthly lease payments averaging $620 last year and $570 this year on mostly luxury cars, people are looking for relief. According to CNW Marketing Research Inc., Americans leased about 9 million cars last year, about 19 percent of new-car deliveries, with leases averaging 39 to 48 months.
“We have found that most of the people who are swapping auto leases would prefer not to,” said CNW researcher Art Spinella. Yet lease swapping “has doubled and the people who use [an online service] for the most part are pretty happy with it.”
LeaseTrader spokesman Evan Sneider said: “We did 20,000 transactions nationwide in 2006, 35,000 in 2007 and we exceeded 45,000 in 2008. This year we are tracking to be above where we were last year.”
While many people will shed their leases to cut expenses, short-term leases are attractive to those with secure jobs.