How is a Lease Buyout Calculated

Lease Buyout Cost Calculator

Residual Value of Vehicle ($):

Number of Remaining Monthly Payments:

Amount of Each Monthly Payment ($):

Purchase Option Fee ($):

Sales Tax Rate (%):

Registration & Title Fees ($):

Outstanding Charges (e.g., excess mileage, wear & tear) ($):

Estimated Total Buyout Cost:

Understanding Your Lease Buyout Options

A lease buyout allows you to purchase your leased vehicle, either at the end of your lease term or sometimes earlier. This can be an attractive option if you love your car, its market value is higher than its residual value, or you want to avoid potential end-of-lease fees like excess mileage or wear and tear charges.

How a Lease Buyout is Calculated

The total cost of buying out your lease isn't just the residual value. Several components contribute to the final price. Our calculator helps you estimate this total by considering the following key factors:

Residual Value of Vehicle: This is the predetermined value of the vehicle at the end of your lease term, as specified in your original lease agreement. It's a significant component of the buyout price.
Number of Remaining Monthly Payments: If you're considering an early buyout, you'll typically need to pay the sum of your remaining monthly lease payments. At the end of the lease, this value would be zero.
Amount of Each Monthly Payment: This is the fixed amount you pay each month for your lease. It's used to calculate the total cost of remaining payments for an early buyout.
Purchase Option Fee: Many lease agreements include a small fee charged by the lessor (the leasing company) for exercising your option to purchase the vehicle. This fee is usually outlined in your lease contract.
Sales Tax Rate: Sales tax is typically applied to the buyout price, which often includes the residual value and any remaining payments. The rate varies by state and local jurisdiction.
Registration & Title Fees: When you buy out your lease, you're transferring ownership of the vehicle to your name. This process incurs standard government fees for new registration and title transfer.
Outstanding Charges: This category includes any additional fees you might owe, such as penalties for exceeding your mileage limit, charges for excessive wear and tear, or unpaid parking tickets. These are added to the total buyout cost.

When to Consider a Lease Buyout

There are two primary scenarios for a lease buyout:

End-of-Lease Buyout: This is the most common scenario. If you've reached the end of your lease and decide you want to keep the car, you'll pay the residual value plus any applicable fees and taxes.
Early Lease Buyout: Some lease agreements allow you to buy out your lease before the term ends. This might be beneficial if the car's market value has significantly increased, or if you want to avoid mileage penalties or wear and tear charges you anticipate incurring. An early buyout typically involves paying the residual value, the sum of your remaining monthly payments, and any associated fees.

Using the Calculator

To use the calculator, simply input the relevant figures from your lease agreement and any estimated outstanding charges. The calculator will then provide an estimated total cost to buy out your lease, helping you make an informed decision.

Remember, this calculator provides an estimate. Always confirm the exact figures with your leasing company before making any financial commitments.

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