What Is a Lease Buyout?

Is your car lease contract nearing its expiration? Typically, North Charleston drivers who are leasing their vehicle follow the standard route of returning the vehicle and settling any remaining fees when the contract ends. However, this is not your only lease-end option! You can also consider a car lease buyout. What is a lease buyout? The traditional lease buyout definition is when a dealership allows a lessee to purchase the vehicle they’ve been leasing for the price of its remaining value at lease-end. If your goal is to own a vehicle but you don’t want to overspend, a car lease buyout could be perfect!

There are two types of car lease buyouts: lease-end and early buyout. Learn how a lease buyout works in the guide below!

Most Common: Lease-End Buyout

A lease-end buyout is the most common type of car lease buyout. As the name suggests, the buyout doesn’t happen until the lease contract reaches the planned expiration date. Mount Pleasant drivers have an advantage in a lease-end buyout because they can usually accurately estimate how much they’ll pay for the car based on the agreed upon lease-end value that was written into the original contract.

A lease-end buyout may be smart if:

• You haven’t found a similar brand-new vehicle that you like for the same price
• You’ve thoroughly enjoyed driving the car in Charleston
• You’ve applied for financing on a buyout and are pre-approved for a good rate
• Since you’ve been driving the car there have been no major repairs

Less Common: Early Lease Buyout

Another car lease buyout option is the early buyout. This is less common and not all lease contracts allow for it. Here, it’s most important to consider how the early lease buyout price is determined, as it’s not as simple as a lease-end buyout. Here’s what goes into determining an early lease buyout price:

• Lease-end residual value on the original lease agreement
• Total amount of the remaining lease payments
• The difference between the actual lease-end value and the estimated lease-end value, if applicable

Because the early lease buyout price isn’t going to be as favorable as a lease-end buyout price, most drivers only pursue it if they’re worried about paying potentially expensive penalties for failure to maintain the car, damaging the car, or going over the mileage limit.

How Does a Lease Buyout Work?

If your ultimate goal is to enjoy the benefits of full car ownership and you intend to save on a pre-owned vehicle, a car lease buyout may just be the ideal solution! You’ll pay used car pricing, but unlike other used cars, you will already know the complete history of the vehicle because you were leasing it.

How does a lease buyout work? Here are the stages:

• Get in touch with your leasing dealership. Contact the dealership you’re leasing with near the end of your lease to ask about a car lease buyout. They’ll inform you as to whether it can be done and what, if any, buyout fees you would need to pay.
• Get pre-approved if necessary. If you intend to finance the buyout, apply for financing if you haven’t already. Many times, it’s most convenient to seek car financing through the same dealership you leased with, but you may want to apply with a few different lenders to compare rates.
• Negotiate, finalize the buyout, and drive home! It’s not guaranteed that there will be room for negotiation, but it never hurts to try! Once you do settle on a good price, the dealership will work with you on the paperwork so you can finalize the buyout and bring your car home to James Island for good!

Explore Your Options at Rick Hendrick Chevrolet

If you have any additional questions about the lease buyout definition or how the process works at Rick Hendrick Chevrolet, contact us to start a conversation! We’re always here to provide car-buying tips you can trust, like wether or not you can take over a lease.