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What Is a Lease Buyout?
A lease buyout means purchasing your leased vehicle instead of returning it at the end of your lease term.
The lease buyout definition in car leasing refers to the option to own the vehicle by paying its predetermined residual value, often with taxes and fees included.
Lease Buyout Meaning in Car Leasing
In the context of car leasing, a lease buyout is when you decide to buy the car you’ve been leasing. This can happen at the end of the lease (known as an end-of-term buyout) or before the lease is up (early buyout).
The buyout price is usually set in your original lease agreement and based on the car’s residual value, which estimates its worth at the end of the lease.
How Lease Buyouts Work
A lease buyout starts with getting your payoff amount from the leasing company.
This total typically includes:
- The residual value (the car’s projected worth at lease-end)
- Any remaining lease payments (if you’re buying out early)
- Taxes and fees, which vary by state
- A purchase option fee, usually between $200 and $500
Once you have the quote, you can decide to either:
- Pay cash for the full amount and own the vehicle outright, or
- Finance the buyout through a lease buyout loan, spreading payments over time
After the buyout is paid, you’ll receive the vehicle title in your name. In many cases, this also helps you avoid lease-end fees, such as disposition charges or penalties for extra mileage and wear.
Many drivers choose this route when the car’s market value is higher than the buyout price, which means they have positive equity.
Lease Buyouts in Car Leasing Agreements
Most lease contracts will include a buyout or purchase option section.
This outlines:
- The residual value of the car
- Any purchase option fees
- Timeframe for exercising the buyout
- Instructions for notifying the leasing company
Lease buyout terms vary by lender, so it’s smart to check your lease agreement early if you’re thinking about buying the car.
Related Terms in Lease Buyout
- Prev Term: Lease Agreement
- Next Term: Lease Buyout Loan
- Related Terms: Residual Value, Disposition Fee, Lease-End Inspection
Understanding a Lease Buyout With Lease End Department
Choosing a lease buyout means you’re investing in a car you already know and trust, while potentially avoiding lease disposition, mileage penalties, or dealership pressure. It’s a smart move for drivers who want to take control of the process.
At Lease End Department, we make it easy with:
- Transparent lease buyout guidance
- Flexible financing options tailored to your credit
- 100% online process, from payoff quote to plate delivery
Thinking about buying out your leased car? Let Lease End Department guide you every step of the way: no stress, no hidden fees, just smart ownership.