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Should you buy out your lease?

Put in the residual from your contract and what the car is worth today. You get the full cost to own it, with sales tax and fees, whether you have equity in it, and the monthly payment if you finance the buyout.

From your lease contract

Also called the purchase option price
Often $300–$500; 0 if none
0 if the lease is ending
Only counts if payments are left

Buying it

A dealer or online trade-in offer. Blank to skip the comparison.
Decimal, e.g. 0.065. Your state's vehicle sales tax.
Blank if paying cash
Lease buyout
Worth buying: $2,150 of equity
Paying off the lease costs $24,350.00; with tax and fees, owning it takes $26,332.75. Financed, that's $636.70 a month.

The numbers

Payoff to the leasing company$24,350.00
Sales tax$1,582.75
Title, registration, fees$400.00
Total to own it$26,332.75
Equity (value − payoff)$2,150.00

Financing the buyout

Amount financed$26,332.75
Monthly payment$636.70
Total interest$4,228.71

Leasing companies often offer their own buyout financing, but it is rarely the cheapest. A credit union or online lender quote takes a few minutes and gives you a number to compare.

If you keep the car

A licensed agent quotes the car you are leasing or buying. No SSN or license number needed.Get an insurance quote →

Questions people ask

How is a lease buyout price calculated?

The buyout price is the residual value written in your lease contract plus any purchase-option fee. If you buy before the lease ends, the payments still owed are added. Most states then charge sales tax on the purchase, and you pay title and registration fees as with any car purchase.

Is it a good idea to buy out my lease?

It is when the car is worth more than the buyout price. Get a trade-in or online offer for the car and compare it to the payoff. If the car is worth more, you have equity: buying it out, or selling it to a dealer for the difference, beats handing it back. If it is worth less, returning it costs you nothing beyond any wear and mileage charges.

Do you pay sales tax on a lease buyout?

In most states, yes. The buyout is a purchase, so sales tax is charged on the buyout price at your state's vehicle sales tax rate. A few states have no sales tax, and some credit tax already paid on lease payments; check your state's rules.

Can I finance a lease buyout?

Yes. Banks, credit unions and online lenders all offer lease buyout loans, and the leasing company usually offers its own financing too. Getting one outside quote before you accept the leasing company's rate is the easiest way to save money.

More detail in the lease buyout guide, or compare leasing against buying for your next car.