Vehicle Lease Agreement Template

4.8 (105 reviews)
All states | 17 types
Updated Apr 23, 2024
~ 11 pages
PDF
5.2K downloads
A Vehicle Lease Agreement is a legal contract between a lessor and a lessee specifying the terms of leasing a car or other vehicle. It is used to set payment schedules, maintenance responsibilities, and return conditions.
VEHICLE LEASE AGREEMENT

This Vehicle Lease Agreement (the "Agreement") is entered into on   (the "Effective Date") by and between

 , an individual having their usual place of living at   (hereinafter referred to as the "Lessor"), and 

 , an individual having their usual place of living at   (hereinafter referred to as the "Lessee"), collectively referred to as the "Parties" and individually as a "Party". 

WHEREAS the Lessor owns the vehicle described in this Agreement (the "Vehicle");

WHEREAS the Lessee wants to lease the Vehicle from the Lessor under the terms and conditions set forth in this Agreement;

WHEREAS the Lessor wishes to lease the Vehicle to the Lessee under the terms and conditions set forth in this Agreement;

NOW, THEREFORE, in consideration of the mutual promises and obligations set forth herein, along with other valuable considerations, the Parties agree as follows:

SUBJECT OF THE AGREEMENT. This Agreement outlines the terms and conditions for the lease of the Vehicle, which are described as follows:

• Make and model:  

• Color:  

• Year:  

• License plate:  

• Type:  

The Vehicle shall be handed over to the Lessee on   (the "Delivery Date") by signing the Vehicle Acceptance Act (Annex A) by both Parties.

The lease term (the "Lease Term") starts on the Delivery Date and shall continue until   (the "End of the Lease Term").

PAYMENT TERMS AND PROCEDURE. The Lessee shall make a fixed lease payment to the Lessor of   (the "Lease Fee") for the duration of this Agreement. The payment is due within   days after the Delivery Date (the "Due Date"). 

LATE PAYMENTS. If the Lessee fails to make any payment on time, a late fee of   per day shall be charged until the Lessor receives the Lease Fee.

LEASE FEES. In addition to the Lease Fee, the Lessee shall pay the Lessor the following fees:

• Acquisition fee. The Lessee shall pay the Lessor an acquisition fee of   upon signing the Agreement. The acquisition fee covers administrative and processing costs related to the purchase of the Vehicle. The acquisition fee is non-refundable and cannot be used to offset the lease or other payments.

• Security deposit. The Lessee shall provide the Lessor with a security deposit of   (the "Security Deposit"). The Security Deposit shall be returned to the Lessee after the End of the Lease Term, provided that the Lessee has complied with all the terms and conditions of this Agreement.

• Disposition fee. At the End of the Lease Term, the Lessee shall pay the Lessor a disposition fee of   (the "Disposition Fee"). The Disposition Fee is designated to account for expenses related to the inspection, processing, and disposal of the Vehicle at the End of the Lease Term. The Lessor has the right to waive the Disposition Fee if the Lessee chooses to lease another vehicle or purchases this or another vehicle from the Lessor at the End of the Lease Term.

All payments will be made in cash.

MILEAGE PAYMENT. The Lessee undertakes to keep the mileage of the Vehicle below the daily limit of   miles (the "Mileage Limit"). The Lessee shall pay the Lessor an excess mileage fee of   for each mile driven in excess of the daily Mileage Limit (the "Mileage Fee") as set forth in this Agreement. The excess Mileage Fee is payable at the End of the Lease Term.

The Lessor may require the Lessee to provide mileage reports at reasonable intervals during the Lease Term. These mileage reports should be submitted by  .

If the Lessee extends the Lease Term, the Lessor shall adjust the Mileage Limit and the Mileage Fee accordingly.

INSURANCE. The Lessor is required to obtain comprehensive and collision insurance for the Vehicle. The Lessor must provide the Lessee with proof of insurance coverage after signing this Agreement. In the event of any insured events, the Lessee shall immediately notify the Lessor and cooperate in processing the claim.

LIABILITY AND INDEMNIFICATION. The Lessee is responsible for the safe and proper operation of the Vehicle and is obliged to comply with all laws and regulations regarding the use of the Vehicle. The Lessee agrees to indemnify and hold harmless the Lessor from any claims, losses, costs, expenses, and liabilities arising from the use, operation, or possession of the Vehicle by the Lessee.

The Lessor is responsible for the condition of the Vehicle at the time of its transfer to the Lessee. The Lessor agrees to indemnify and hold the Lessee harmless from any claims, losses, costs, expenses, and liabilities arising from the Lessor's failure to fulfill this obligation.

The Lessor shall not be liable to the Lessee or any third party for any indirect, incidental, special, or consequential damages arising from the Lessee's use or possession of the Vehicle, including but not limited to loss of profit or loss of use.

The indemnification obligations under this section shall remain in effect after the termination of this Agreement. Any Party seeking indemnification under this section shall promptly notify the other Party of the claim and cooperate in the defense of the claim. The Party responsible for indemnification shall have the right to assume control of the defense and settlement of any claim, bearing all associated expenses.

PURCHASE OPTION. At the End of the Lease Term, the Lessee has the right to purchase the Vehicle from the Lessor for   (the "Purchase Price"). The Purchase Price shall be paid by the same method specified for Lease Fee payment.

The Lessee must provide a written notice outlining the Lessee's intention to purchase the Vehicle no later than   days before the End of the Lease Term. Failure to give timely notice shall result in the automatic termination of the purchase option.

The Lessee acknowledges that the Vehicle is purchased in "as is" condition at the End of the Lease Term, without any warranties or representations from the Lessor regarding its condition, suitability for use, or presentation. 

Upon payment of the Purchase Price, the Lessor transfers the ownership of the Vehicle to the Lessee. The Lessor shall be responsible for all costs associated with the transfer of ownership, including but not limited to any applicable taxes, registration fees, and title fees.

If the Lessee fails to pay the Purchase Price or breaches any other obligations under this Agreement, the Lessor may pursue all available legal or equitable remedies, including but not limited to the repossession of the Vehicle.

NOTICE. Any notice or communication required to be given under this Agreement shall be deemed duly given if delivered personally or sent by registered mail, return receipt requested to the address set forth in the opening paragraph or to such other address as one Party may have furnished to the other in writing, or to emails set forth below:

If to the Lessor:  ;

If to the Lessee:  .

Either Party may change the registered mail or email address for receipt of notices by giving written notice to the other Party.

TERM AND TERMINATION. This Agreement shall commence on the Effective Date and shall continue until the End of the Lease Term unless terminated earlier in under the terms of this Agreement. The Agreement may be extended by mutual written consent of the Parties in accordance with the terms and conditions outlined herein unless otherwise agreed by the Parties.

This Agreement may be terminated at any time by mutual written consent of the Parties. 

If the Lessee does not fulfill obligations, including but not limited to non-payment of the Lease Fee for   days or other payments due under this Agreement, failure to maintain insurance coverage, or violation of any other term or condition of this Agreement, the Lessor may terminate this Agreement and return possession of the Vehicle without giving the Lessee prior notice.

The Lessee may terminate this Agreement before the End of the Lease Term by providing written notice   days in advance by paying all amounts and any other applicable fees due under this Agreement.

Upon termination of this Agreement, the Lessee shall immediately return the Vehicle to the Lessor.

 

RETURN OF THE VEHICLE. Upon the expiration or early termination of this Agreement, the Lessee is obliged to return the Vehicle to the Lessor in good condition (the "Good Condition"), except for reasonable wear and tear. The return of the Vehicle shall be carried out in accordance with the Vehicle Acceptance Act. The Lessee shall be responsible for all damages to the Vehicle that are not attributed to normal wear and tear or covered by insurance, as well as for any missing parts or accessories.

The Vehicle must be returned to the place specified by the Lessor unless the Parties have agreed otherwise in writing. The Lessor has the right to inspect the Vehicle upon its return.

The Lessee may request a pre-return inspection of the Vehicle at least   before the End of the Lease Term. The Lessor is obliged to conduct the inspection and provide the Lessee with a written report on the condition of the Vehicle. The Lessee may use this report to make necessary repairs or adjustments before returning the Vehicle to the Lessor.

If the Lessee does not return the Vehicle to the Lessor upon the expiration or early termination of this Agreement, the Lessor may take any legal action necessary to regain possession of the Vehicle and recover any outstanding amounts owed under this Agreement. These include but are not limited to lease payments, late fees, and compensation for any losses incurred by the Lessor due to the failure to return the Vehicle. 

Before returning the Vehicle, the Lessee must remove all personal belongings, including but not limited to removable audio and video equipment, mobile phones, and personal accessories.

The Lessor may provide the Lessee with additional instructions or requirements for the return of the Vehicle, which the Lessee is obligated to follow.

MAINTENANCE. The Lessor shall be responsible for the current maintenance and repair of the Vehicle. The Lessor is obliged to maintain the Vehicle in compliance with the manufacturer's recommendations, timely perform all necessary maintenance work, and cover associated expenses. The Lessor must keep accurate records of all maintenance and repair work and provide them to the Lessee upon request.

RESTRICTIONS AND ACCEPTABLE DRIVERS. The Lessee shall not permit any person to drive the Vehicle except for the following drivers:

1.  .

The Lessee represents and warrants that all drivers listed herein possess valid driver's licenses and are authorized to drive the Vehicle in the United States of America.

WARRANTIES. The Lessor warrants being the legal owner of the Vehicle and having the right to lease it to the Lessee. The Lessor does not provide any other warranties, whether express or implied, regarding the Vehicle, including any warranties of merchantability or fitness for a specific purpose. The Lessee acknowledges that the Vehicle has been inspected and accepted in its current state at the time of delivery (the "Present Condition"), except for normal wear and tear. The Lessee further acknowledges that the Lessor has not provided any representations or warranties regarding the condition, quality, or fitness of the Vehicle for the Lessee's intended use.

FORCE MAJEURE. Neither Party shall be liable for any failure to perform or delay in performing the obligations under this Agreement if such failure or delay is caused by events of force majeure, including but not limited to acts of God, war, terrorism, strikes, lockouts, labor disputes, pandemics, governmental regulations, or any other similar causes beyond the reasonable control of the affected Party.

In the case of force majeure, the affected Party shall immediately notify the other Party in writing and provide reasonable proof of the cause of the delay or inability to perform the obligations. The Party affected by force majeure shall endeavor to mitigate the consequences of such circumstances and resume the performance of obligations as soon as possible after the circumstances cease to exist.

If the force majeure circumstances last more than   days, either Party may terminate this Agreement by giving written notice to the other Party. In this case, neither Party shall be liable to the other Party for any damages arising from the termination of this Agreement.

GOVERNING LAW AND DISPUTE RESOLUTION. This Agreement shall be governed by and construed in accordance with the laws of the State of  , and any disputes arising out of or in connection with this Agreement shall be exclusively resolved by the courts of the State of  .

SEVERABILITY. The invalidity or unenforceability of any provision of this Agreement shall not affect its validity or enforceability.

BINDING EFFECT. This Agreement shall be binding on the Parties and their respective successors and assigns.

WAIVER. The failure of any party to enforce a particular provision of this Agreement shall not constitute a waiver of their right to enforce that provision in the future.

ENTIRE AGREEMENT. This Agreement constitutes the entire understanding between the Parties and supersedes all prior or contemporaneous agreements, understandings, negotiations, or discussions, whether oral or written, relating to the subject matter of this Agreement. Any amendments or modifications to this Agreement must be in writing and signed by both Parties. 

AMENDMENTS. This Agreement may be amended or modified only by a written agreement signed by both Parties. Any amendments to this Agreement shall be binding only if they are in writing and signed by both Parties.

ANNEXES. Any annexes, appendices, schedules, and exhibits to this Agreement are integral parts of this Agreement. In case of any inconsistencies between the provisions of the main body of this Agreement and its Annexes, the provisions of the main body of this Agreement shall prevail.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.

THE LESSOR

THE LESSEE

 ,

 , USA

 

 

______________________

(Place for signature)

 

 

 ,

 , USA 

 

 

______________________

(Place for signature)

 

 

ANNEX A VEHICLE ACCEPTANCE ACT
to the Vehicle Lease Agreement dated  

We, the undersigned,

 , an individual having their usual place of living at   (hereinafter referred to as the "Lessor"), and 

 , an individual having their usual place of living at   (hereinafter referred to as the "Lessee"), collectively referred to as the "Parties" and individually as the "Party", acting voluntarily and completely aware of their actions, have concluded this Vehicle Acceptance Act to the Vehicle Lease Agreement dated  , confirming the following:

The Parties confirm that the Lessor has transferred and the Lessee has accepted the following Vehicle:

• Make and model:  

• Color:  

• Year:  

• License plate:  

• Vehicle type:  

This Vehicle Acceptance Act is an integral part of the Vehicle Lease Agreement dated  .

THE LESSOR

THE LESSEE

 ,

 , USA

 

 

______________________

(Place for signature)

 

 

 ,

 , USA 

 

 

______________________

(Place for signature)

 

 

Written by Megan Thompson - Reviewed by Jonathan McGill

Template Description

Copy section link
Paper named "Vehicle Lease Agreement," car, car keys, and a pen

If the new car model is out of your reach, think about leasing it for a specific period. This is where a vehicle lease agreement sample would be quite helpful. It is a contract between lessee and lessor that stipulates details of lease duration, mileage, and monthly payment.   

You can choose a vehicle lease agreement template that has pre-written and properly formatted content. If you’re looking for one, check out this simple vehicle lease agreement template to get instantly started with your new lease tenure. 

What Is a Vehicle Leasing Agreement?

Copy section link

A standard vehicle lease agreement template is a legal contract used by the involved parties while transferring the vehicle possession from the owner to the one leasing the vehicle for a specific time period. Every rental car agreement sample contains the following necessary information:

  • Involved parties

  • Vehicle description

  • Leasing rates

  • Lease duration

  • Insurance and warranty

A typical vehicle lease agreement template applies to any motor vehicle with a VIN (Vehicle Identification Number), such as trucks, cars, motorbikes, recreational vehicles, mopeds, powerboats, motorized scooters, etc. In the case of powerboats, the Hull Identification Number (HIN) is used in the vehicle description section.

Other than a lease agreement for a truck, there are some other common names for this contract, which include:

  • Commercial vehicle lease agreement

  • Private auto lease agreement

  • Van hire agreement

While drafting a printable car lease agreement template, covering all aspects without errors is essential. Therefore, a car lease example template can be the right option to avoid any unwanted legal complications during or at the end of the lease tenure. 

Parties of the Vehicle Lease Agreement

A vehicle lease agreement has two parties, i.e., the lessee and the lessor. Here is a brief description of both:

  • Lessor –– This is the company or person that owns the vehicle. The lessor leases the vehicle to the lessee.
  • Lessee –– The company or person that applies for the car's ownership during the lease tenure. The lessee gets the vehicle after entering the lease agreement with the lessor.

Key Terms

Legal writing can be complicated for those without legal training. So, here's a look at some important terms that you will find in a rent car agreement format. 

  • Monthly Payment –– The agreed amount the lessee must pay to the lessor every month.

  • Lease Term –– Duration of the lease agreement.

  • Residual Value –– Estimated value of the leased vehicle at the end of the lease agreement.

  • Early termination –– The authority of the lessor to end the agreement before the agreed end date; it is subject to non-payment, penalties, and fees.

  • Mileage Allowance –– The number of miles the lessee can drive the vehicle during the lease agreement.

  • Wear and Tear –– The routine wear and tear that the vehicle will undergo during the lease agreement. The lessee will often be responsible for the wear and tear during the lease tenure. 

  • Security Deposit –– Amount paid by the lessee to cover any potential damage and excessive wear and tear to the vehicle during the agreement. 

  • Excess Mileage Fees –– Amount charged to the lessee in the event that they exceed the agreed upon mileage limit.

What Are the Advantages of Leasing a Vehicle?

Copy section link

Leasing a vehicle has many advantages. Here is how it helps:

  • You can use a newer vehicle for a much lower monthly payment.

  • You don't need to worry about depreciating vehicle value because you can return it at the end of the agreement.

  • It lets you drive high-end vehicles that you may not be able to afford otherwise.

Who Must Register the Leased Vehicle?

Copy section link

Registering the leased vehicle is the responsibility of the lessor. That's because the lessor permanently owns the car, unlike the lessee, who has possession of and access to it for a pre-decided duration. 

What Happens When the Vehicle Lease Term Ends?

Copy section link

At the end of automobile lease agreements, the lessee must return the vehicle to the lessor. However, if a provision in the contract allows for the purchase of the vehicle, the lessee has the right to take advantage of that. 

If the lessee wants to buy the vehicle, the payments made during the agreement tenure are counted as part of the purchase payment. Moreover, the lessee may have to pay any penalties that apply at the end of the lease agreement.

Vehicle Description

This section discusses the leased vehicle's specifications and legal and relevant technical information. Usually, it includes:

  • Make;
  • Model;
  • VIN;
  • Year.

Moreover, this section also discusses how the lessee wants to use the vehicle, i.e., for personal, household, or family use. 

Lease Term

This part discusses the start and end date of the copy of a car lease agreement, and there may be additional provisions for early termination too. 

Terms of Payment

Blank printable car rental agreement forms discuss the payment terms, precisely the monthly payment amount, due dates, and penalties for late payments.

Vehicle Usage

Talks about the intended use of vehicles and restrictions related to monthly mileage, geographical limitations, etc.

Vehicle Insurance

In this section, you will find insurance details, minimum liability amount, and other requirements to claim insurance for the vehicle.

Repair and Maintenance Responsibilities

Discusses the lessee's responsibilities to repair and maintain the vehicle for the lease agreement period. 

Default Remedies

This section of the downloadable printable car rental agreement discusses the consequences of default and the lessor's rights in such a situation. If the lessee fails to adhere to the agreement provisions, the lessor has the right to repossess the vehicle and terminate the contract.

How Do I Create a Vehicle Lease Agreement?

Copy section link

To create a trucking lease agreement template for free, you must provide the essential details about your agreement. Here is how you can create your agreement in no time.

  1. Provide the purpose of vehicle use, either personal or business-related.

  2. Mention your state.

  3. Provide the details of the lessor and lessee.

  4. Enter vehicle description, i.e., color, make, model, body type, VIN, etc.

  5. Provide lease details

  6. Provide lease costs and fees. This can include expenses like security deposit, residual value, retail value, etc.

  7. Mention the monthly payments.

  8. Mention whether you want to add an early termination provision to the agreement.

  9. Discuss any warranties

  10. Provide insurance and deductible details.

  11. Provide any additional clauses.

  12. Sign the agreement to complete.

Why Should I Use a Vehicle Lease Agreement?

Copy section link

Even a short rent agreement format in Word protects the lessor and the lessee legally. It enhances communication and reduces any risk of misunderstanding and lack of communication between the parties. 

Common Use Cases

Here are a couple of common use cases for a free car rental agreement form in PDF:

  • Personal Use - A vehicle lease agreement can be a great option when a person wants to use a high-end vehicle for a specific duration without buying the car.

  • Ride-Sharing Service - Ride services like Uber and Lyft use leased cars. It saves them from higher purchase costs and ensures quality and comfortable rides for the passengers.

When Not To Use the Vehicle Lease Agreement

While a lease agreement is pretty helpful in most cases, here are a couple of cases where you're better off not entering into such an agreement:

  • If you are expected to exceed the monthly mileage limit regularly, you will have to pay extra money in penalty.

  • If you don't intend to buy the vehicle after the contract ends, you will be without a vehicle at the end of the lease and won’t have anything to show for your payments., In this case, you might have to rent or lease a new vehicle.

Related Documents

Also read

Who Is Responsible for Registration on a Leased Vehicle?
Vehicle Lease Agreement Preview