Can I Trade In My Car for a Lease? Absolutely, and you can end up with a lease that doesn’t cost you much money 3. By applying the money that you receive from a trade-in as the down payment on a lease, you can reduce the size of your monthly lease payments, the amount due at signing, or both. Normally, a trade-in can be applied to a car purchase as part (or all) of your down payment. But when your trade-in has negative equity, it's the exact opposite. Instead of having a down payment, you are bringing debt to the table. When you have bad credit, this can hurt your chances of getting approved for another auto loan. If you’re cash-strapped and are trading in an older car that’s only worth a couple thousand dollars, it might make sense to use the proceeds as a down payment to keep your lease payments affordable. On the other hand, you may not want to do this if your trade-in is worth considerably more. If you’re financing a new vehicle, making a