What Is a Lease Buyout?

2023 Honda Accord Touring Hybrid

A car lease buyout is when you buy out the car you’re leasing before the lease ends or right at the end of the lease. How does a lease buyout work, exactly? The finance center at Shenango Honda covers the basic lease buyout definitions to help you decide which option is best for your circumstances. Then, we invite you to visit our dealership and explore your options in more detail with our team – even if you didn’t originally lease your Honda from us!

Car Lease Buyout Definition #1: Lease-End Buyout

Most Sharon drivers choose this option. This requires you to pay what the vehicle is expected to be worth by the end of the lease period. Normally, this price point is agreed upon before you sign the lease agreement. This choice is a good deal if:

  • You like the vehicle.
  • There have been little to no repairs since you’ve had the car.
  • There’s no other vehicle, at a similar price point, that you’d like better.
  • You can get a good interest rate to finance the buyout price.

Another perk is knowing the condition and history of the vehicle you’ve been leasing, unlike when purchasing a different used car.

Car Lease Buyout Definition #2: Early Lease Buyout

With this option, you can purchase your vehicle before the end of the lease contract. Not all lease contracts allow this, so be sure to check beforehand if this might be an option for you. Before considering an early lease buyout, you’ll also want to be sure it’s worth the long-term investment to buy instead of lease.

With this, keep in mind the history of the vehicle. Near the end of the lease, the price is determined by:

  • The estimated lease-end residual value on your original contract
  • The amount you still owe on the lease
  • The difference between the vehicle’s depreciation and its market value (if the vehicle is below market value)

Most times, Hubbard buyers consider this buyout option when concerned about lease penalties like going over mileage, not maintaining scheduled services, or damages to the interior or exterior of the vehicle.

How Does a Lease Buyout Work?

If your goal is to own your vehicle and you think a car lease buyout is a good option for your budget and finances, here are the steps you can take:

  • Talk With Your Lender: When you’re nearing the end of your lease, reach out to the institution you’re leasing with to inquire about your options. They can tell you more about how a car lease buyout works with them, including whether there are any fees associated with facilitating a buyout.
  • Apply for Financing: Some Mercer drivers choose to pay for their car lease buyout in full if they’ve been saving for it, but there are also car lease buyout loans available. If you plan to finance your lease buyout, now is a good time to apply for pre-approval with a few lenders to see how you qualify. You can also easily apply for financing online with Shenango Honda!
  • Finalize the Buyout: There may be room to negotiate your car lease buyout down to a lower price. Once you’ve settled on a price you feel comfortable with and secured your financing, all that’s left to do is finalize the buyout!

Consider a Lease Buyout in Hermitage!

So, how does a lease buyout work at our dealership? If you have any other questions about the lease buyout process or which option would be best for you, contact us! We’d be happy to go over your lease options with you or have you return your lease to us, even if you didn’t originally lease your vehicle from our dealership!