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| Lease Penalty | ||
Lease penalty typcially refers to the excessive mileage or wear-and-tear charges at the end of a car lease. Lease contracts specify a mileage limit that, if exceeded, results in additional charges, a penalty, levied on a per-mile basis. Any damages or excessive wear beyond "normal" (as specified in the lease contract) will also result in additional charges. Sometimes penalty charges occur when terminating a lease before its normal end date. The amount varies by lease company and may depend on the amount of time remaining in the lease. If you look at lease-end charges from a lease company's perspective it's not difficult to understand why the charges exist. Any additional mileage or wear-and-tear reduces the resale value of a vehicle. The lease company simply wants to be paid for the extra depreciation.
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