Page published October 26, 2026. Revised November 6, 2026
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A lease buyout, in plain words
A lease buyout means paying to keep the car when the lease ends. The starting price is the residual value: the value the leasing company set for the car at the end of the lease, written in the contract on day one. The buyout adds a purchase option fee and tax and title on top of that residual. Once those are paid, the car is yours and the lease ends.
The residual is not the whole price. The buyout total is. This page adds the contract's own numbers up and sets the total next to the car's market value, so the comparison is visible in one place.
Go ahead, play with it. Change any number and watch the total move.
Run your contract's numbers
This runs your contract's numbers. Nothing here is a market average. Enter the residual value, the buyout fee, and the tax and title estimate from the contract, plus a market value from a quote for the same car. The page adds the buyout up and compares it.
How to read it: below market means the buyout total is less than the car sells for now; above market means it costs more than the car sells for.
How the total is worked out: residual plus buyout fee plus tax and title. The market value is only a comparison. It isn't part of the buyout total.
Where the numbers come from: Tax and title: Tax Foundation, midyear 2026, average combined rate 7.53% · Market value: KBB or Edmunds appraisal.
How to use
- Find the residual value in the purchase option section of the contract. It was set at lease start and it does not change.
- Enter the buyout fee from the contract. Purchase option fees commonly run $300 to $500.
- Enter the tax and title estimate. The average combined sales tax rate is 7.53% (Tax Foundation, midyear 2026). The example uses $1,200.
- Enter the market value from a quote for the same year, model, trim, and mileage. Kelley Blue Book or Edmunds appraisal.
- Read the buyout total against the market value. Then run the financing calculator if you will borrow, because interest can push the total past market value.
Formula
Buyout total equals the residual value plus the purchase option fee plus tax and title. Buyout total vs market value equals market value minus buyout total. A positive number means the total sits below market; a negative number means it sits above.
Financing is a separate step, on the buyout payment calculator. Amount financed equals buyout total minus down payment. The monthly payment comes from the standard amortizing loan formula, and total paid equals down payment plus monthly payment times the term. The average used-car loan rate is 11.19% (Experian, Q2 2026).
An early buyout is different from an end-of-lease buyout. Early payoff equals residual value plus remaining payments plus buyout fee plus tax and title. It is not the same as the end-of-lease residual.
Calculation transparency
Jurisdiction. United States. Sales tax, titling, and registration rules are set by your state, so your exact buyout total depends on where you register the car.
Rules and time period. The buyout total is the residual value plus the purchase option fee plus tax and title, all from the contract and the state. The market comparison uses a quote for the same year, model, trim, mileage, and condition.
Scope and limitations. Educational estimate only. Market values are quotes, not guarantees. Fees and tax handling vary by contract and state. A buyout quote from the leasing company is the document that binds.
Source links checked November 6, 2026. Figures: Experian State of the Automotive Finance Market (Q2 2026); Tax Foundation State and Local Sales Tax Rates, Midyear 2026; Consumer Financial Protection Bureau auto-loan guidance; Regulation Z (12 CFR Part 1026); Regulation M (12 CFR Part 1013); Edmunds appraisal values.
Primary sources: Experian, used-car loan rates; Experian, average car payment; Tax Foundation, 2026 sales tax rates, midyear; CFPB, auto-loan shopping guidance; Regulation Z, 12 CFR Part 1026; Regulation M, 12 CFR Part 1013; Edmunds, car appraisal values.
A worked example, from the calculator above
Example: a residual of $18,000, a $350 buyout fee, and $1,200 for tax and title. The calculator adds it up to a buyout total of $19,550. Against a market value of $21,000, that total sits $1,450 below market. The calculator above starts on these exact numbers. Change any number and the example becomes your contract.
Buyout total vs. market value: what each side means
A buyout total below market value means keeping a car you already know, with its full history in your hands, for less than its market price. A buyout total above market value means the same money buys more car elsewhere, or the same car for less, if you shop. A buyout total right at market value means the money side is even, and the decision turns on the car itself: its condition, its history, and whether starting over appeals to you.
The market value has to match the car: same year, model, trim, and mileage, and similar condition. A quote for a different trim or a much lower mileage is not the same comparison. Get the quote first, then run the numbers.
Leasing versus buying from the start is a different question, covered on the lease vs. buy page. What a lease costs when it ends, including the return side of the decision, is covered on the lease-end costs page. For an electric car, where the lease question has its own twist, see whether to lease or buy an EV.
What to check on the contract
- Residual value. The purchase option section states it. It was set at lease start and it doesn't change during the lease.
- Purchase option fee. A flat fee for buying the car out, set in the contract. It changes with the leasing company.
- Disposition fee. Charged if you return the car instead of buying it. Knowing it puts the return side of the decision in numbers too.
- Mileage and wear terms. Charges for mileage over the lease limit or wear beyond normal use apply on return, not on buyout. They belong in the comparison when returning is on the table.
- Early buyout terms. Some contracts let you buy out before the lease ends and some don't. An early payoff figure isn't the same as the end-of-lease residual.
- Tax and title handling. Sales tax and title and registration charges are set by the state. The estimate in the calculator is yours to adjust to your state's figures.
Definitions
Residual value. The value the leasing company set for the car at the end of the lease, written in the contract on day one. It does not change during the lease.
Purchase option fee. A flat administrative fee for buying the car out, set in the contract. Purchase option fees commonly run $300 to $500.
Buyout total. Residual value plus purchase option fee plus tax and title. The full price of keeping the car, before any financing.
Market value. What the same car sells for now: same year, model, trim, mileage, and similar condition, from a quote, not a guess.
Disposition fee. The fee charged for returning the car at lease end, typically $300 to $500. Buying the car out avoids it; returning the car pays it.
Early buyout payoff. Residual value plus remaining payments plus buyout fee plus tax and title. The price of buying out before the lease ends.
Common questions
What is a lease buyout? A lease buyout means paying to keep the car when the lease ends. The price starts with the residual value written in the contract, plus a buyout fee and tax and title. Once those are paid, the car is yours and the lease ends.
What fees come with a buyout? Most buyouts come with a purchase option fee from the contract, plus sales tax and title and registration charges from the state. Those amounts change with the contract and the state, so the calculator uses your own contract numbers and your own state estimate.
How do I know if the buyout price is fair? Compare the buyout total with the market value of the same car: same year, model, trim, and mileage. Get a market quote from a dealer or a car buying service, enter it in the calculator, and see whether the buyout total sits below, above, or right at that value.
What happens if I return the car instead of buying it? The car goes back and the lease ends. The contract may charge a disposition fee, plus charges for mileage over the lease limit or wear beyond normal use. Those amounts are in the contract, so read them before the return date.
Can I buy out my lease early? It depends on the contract. Some leases allow an early buyout and some don't. An early buyout payoff isn't the same as the end-of-lease residual, because remaining payments are part of it. Check the contract or ask the leasing company for the early payoff figure.
Related: The buyout starts with how the lease was built. See how your lease payment is built.
Related: Financing the buyout means a payment. See how much your car payment will be.
Related: A financed buyout can leave you owing more than the car is worth. See what being upside down costs.
Whatever the residual on paper says, add the fee and the tax and title first, then set the total next to a market quote for the same car. The calculator above does that comparison for you.