How Leased Vehicles Are Valued in The Marital Estate
When your marital estate is divided, vehicles purchased under lease agreements require special consideration.
Whether a leased vehicle is a liability or an asset is almost a point-of-view situation. You don’t own the vehicle, and you make payments for the use of it. By that criteria, it is a liability. On the other hand, you are in possession of the vehicle and can drive it. From that perspective, it is an asset.
Lease vs. Lease Purchase
When considering the vehicle with regard to the marital estate, your family lawyer will need to know whether it was a true lease or you leased the vehicle with the intention of eventually owning it outright. Simply put, if you have to turn the car back in to the dealer, it is a lease. If not, then the final payment makes the vehicle yours and title will be transferred to your name. If this was the original intent, the final payment will usually be quite small. If not, then you may have a large payment to make in order to initiate a buyout of the lease.
Inclusion in the Marital Estate
In a lease situation, the fact that you have possession and use of the car is cancelled out by the payments you must make for something you will never own. Your family law attorney, given those circumstances, will not include the vehicle in the marital estate.
A lease-to-purchase requires different handling. Ultimately, you will own the vehicle. This makes it an asset, so your family law attorney will include it as such in the valuation of your marital estate.
Provided by HG.org
Disclaimer: Every effort has been made to ensure the accuracy of this publication at the time it was written. It is not intended to provide legal advice or suggest a guaranteed outcome as individual situations will differ and the law may have changed since publication. Readers considering legal action should consult with an experienced lawyer to understand current laws and.how they may affect a case.