What is a Lease Buyout?

Woman shaking mans hand over a car contract clipboard with car keys

If you’re nearing the end of a car lease in the Apex area, you may know that there are going to be two options you’ll be presented with: turn in the lease at the dealership, or pursue a car lease buyout. What is a lease buyout? The lease buyout definition is simple: at the end of your lease, you can purchase the car for the cost of its lease-end value. There are generally two types of car lease buyouts—the lease-end buyout and the early lease buyout, though the former is the most common option for Carrboro drivers. 

Learn More About Lease-End Buyouts

As we noted, the most common type of car lease buyout is the lease-end buyout. As the name suggests, this method involves waiting until the lease-end date on the original lease contract to facilitate the buyout. The price paid for the buyout is the value of the car at the end of the lease; this amount is usually agreed upon when the original lease agreement is drawn up. Here are some signs that a lease-end buyout could be a great option for you:

  • You thoroughly enjoy driving the vehicle
  • The vehicle hasn’t required any hefty repairs during your time with it 
  • You haven’t found a similarly priced newer vehicle that you’d prefer 
  • You’re qualified for a good interest rate on an auto loan

What is an Early Lease Buyout? 

Another type of car lease buyout is the early lease buyout. Though less common, some Chapel Hill-area dealerships do offer it; we recommend checking beforehand. Instead of waiting until the natural end of the lease, the early lease buyout is performed at an earlier date, before the contract is fully paid off. For this reason, the price of an early lease buyout may vary based on the following factors: 

  • The lease-end residual value 
  • The total amount of the remaining lease payments 
  • The difference between the estimated lease-end value and the actual value at the time you want to do the buyout

Typically, a lease-end buyout is reserved for instances when the lessee has concerns like going over the mileage limit, failing to get scheduled maintenance, or damage to the vehicle. 

How Does a Lease Buyout Work? 

If you dream of owning your own car and you intend to save money by buying a pre-owned vehicle, a car lease buyout can be a fantastic option! Instead of purchasing a standard used car that you may not know much about, you’ll be purchasing a used car that you know everything about because you’ve been leasing it prior to buying it. 

So, how does a lease buyout work? Here’s what you should expect:

  • Contact the leasing office. When the end of your lease is approaching, reach out to the leasing office at the dealership to ask whether a car lease buyout is possible. They will tell you how to move forward with it and can provide more information about potential buyout fees and anything else you would need to know. 
  • Get approved for financing. If you want to finance your buyout, apply for pre-approval to start the process. You can get a lease buyout loan from your own lender, but many shoppers find that it’s easiest to get financing from the dealership they were leasing with. 
  • Finalize the buyout. Once you settle on the car lease buyout price, all that’s left to do is finalize it and sign any necessary paperwork! Then, you’ll head back home in your car to enjoy the freedom of ownership. 

Explore Your Options at Hendrick Dodge Cary

After exploring the lease buyout definition, does this sound like a good option for you? If you would like to learn more about car lease buyouts, please contact us at your convenience! We’ll be happy to tell you more about the process so you can confidently decide whether to move forward with a lease buyout in Cary.

 

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