Lease Buyout Calculator
See what it costs to buy your leased car — at lease end or early — with the residual or payoff amount, purchase and dealer fees, sales tax and registration, whether you have equity versus its market value, what returning it would cost instead, and the monthly payment if you finance the buyout.
How it works
Buyout = residual (or early payoff) + purchase fee + other fees + sales tax · Sales tax = buyout price × tax% · Early payoff ≈ residual ÷ (1 + i)^n + payment × (1 − (1 + i)^−n) ÷ i, with i = money factor × 2 · Equity = market value − buyout · Advantage vs returning = equity + disposition, mileage and wear charges avoided
A lease buyout lets you keep the car for its residual value — the price locked in when you signed. Add the purchase-option fee, any dealer and registration fees, and sales tax to get the true cost. Whether it is smart comes down to equity: if used-car prices have risen above your residual, the car is worth more than the buyout and you keep the difference; if not, you are overpaying versus buying a comparable used car. Returning the car is not free either — a disposition fee and any excess-mileage or wear charges are due only if you hand it back, so the calculator counts them in favour of buying. For an early buyout, the lessor’s payoff is usually the remaining lease balance: the residual plus the depreciation you have not yet paid, which is the present value of the remaining payments and the residual at the lease rate (money factor × 2 a month). That is less than adding up every remaining payment, because the lease charge for the skipped months drops off; the calculator shows both and compares buying now with finishing the lease and buying at the end. If you will borrow, turn on financing to see the monthly payment, total interest and a yearly loan schedule.
Worked example
With a $19,250 residual, a $350 purchase fee and 8% tax on the residual, the sales tax is $1,540, so the buyout totals $21,140. If the car is worth $21,000 on the market you pay about $140 over market — but returning it would cost a $395 disposition fee, so buying comes out about $255 ahead: close to break-even. Buying 12 months early instead, with $400 payments and a 0.0025 money factor (0.5% a month), the payoff is $19,250 ÷ 1.005¹² + $400 × (1 − 1.005⁻¹²) ÷ 0.005 = $22,779.25 — $1,270.75 less than the $24,050 of residual plus remaining payments, because the lease charge for those months drops off.
Sources: Federal Reserve — Keys to Vehicle Leasing (consumer guide)
Frequently asked questions
Is a lease buyout ever a good deal?
When used-car values have climbed above your fixed residual, yes — you buy the car for less than it is worth and capture the equity. Charges you would pay on return (disposition fee, extra miles, wear) also tip the balance toward buying. When values are soft, the residual can exceed market value and you would do better buying a comparable used car elsewhere.
Do I pay sales tax on a buyout?
In most states you pay sales tax on the buyout price, since you are now purchasing the car, and some states also tax the fees. A few give credit for tax already paid on the lease payments. Pick how your state charges it under More options.
What is the purchase-option fee?
It is a flat administrative fee, often $150–$500, written into the lease for exercising the buyout. It is separate from the residual, from tax and from any dealer documentation fee.
How is an early lease buyout calculated?
Most lessors take the residual plus the depreciation you still owe — mathematically, the remaining payments and the residual discounted at the lease rate. That removes the lease charge for the months you skip, so the payoff is lower than adding up all remaining payments. Some contracts add an early-termination fee. Always ask the lessor for the exact payoff quote.
Can I finance a lease buyout?
Yes. Banks, credit unions and the lessor’s finance arm offer lease-buyout loans, usually at used-car rates. Turn on financing to see the monthly payment and total interest for your rate and term.
Related calculators
Educational estimate, not financial advice.