What is a Lease Buyout?

If your car lease is about to expire, you have two options. You can return your vehicle to the dealership and settle any fees or you can negotiate a car lease buyout. You might be asking, “What is a lease buyout?”
 

A basic lease buyout definition is when your dealership allows you to purchase a vehicle before the end of a lease contract for the price of its remaining value. There are two different types of car lease buyout options to consider and it’s important to know what’s available. So, how does a lease buyout work? Myrtle Beach Chrysler Jeep explores the different types of car lease buyout options you can find at our dealership near Conway. Call us at 843-353-6349 or reach out online for more information about a lease buyout definition.

Lease-End Buyout

Before discussing how a lease buyout works, let’s explore one of the most common around Surfside Beach. A lease-end buyout means you will pay what the vehicle is expected to be worth by the end of the lease period. Normally, this price point is agreed upon before you sign your lease agreement. This can be a great deal if:

You’re happy with your vehicle
There have been few to no repairs since you’ve had the car
There is no other vehicle, at a similar price point, that you would prefer
You can get a good interest rate to finance the buyout price

Another benefit is that you will know the history and condition of the vehicle you’ve been leasing, unlike if you’re buying a different pre-owned car.

Early Lease Buyout

When considering this choice, you will buy your vehicle before the end of your lease contract. Not all lease contracts offer this, so make sure to check beforehand if this is a potential option for you. Before choosing an early lease buyout, you want to be sure it’s worth the long-term investment to buy instead of lease. With this, remember your vehicle’s history. As the lease comes to an end, the price is determined by:

The lease-end residual value on your original contract
The lease-end residual value on your contract
The amount you will own on your lease
If your vehicle has depreciated quicker and below market value, you may have to pay the difference

Many times, North Myrtle Beach buyers will consider this buyout when concerned about lease penalties, including going over mileage, including not maintaining scheduled services, or damages to your vehicle’s exterior or interior.

Early Lease Buyout

• Speak to Your Leasing Institution: As you’re coming to the end of your lease, reach out to the institution you’re leasing with to inquire about your options. They can tell you more about how a car lease buyout works, including whether you have any fees linked to facilitating a buyout.
• For Those Financing The Buyout, Apply For Pre-Approval: Some Myrtle Beach buyers choose to pay for their car lease buyout in full if they’ve been saving for it, but there are car lease buyout loans available. If you want to finance your car lease buyout, now is a good time to apply for pre-approval with some lenders to see how you qualify. Often, you will be able to secure financing via the same dealership you had your lease with, but you should explore all possible options.
• Negotiate and Finalize Your Buyout: There might be room to negotiate your car lease buyout down to a lower price. Once you’ve settled on a price you feel comfortable with and secured financing, all that’s left is to finalize the buyout.