You probably didn’t think about buying your car when you first leased it. Perhaps you enjoyed the low monthly payment, the opportunity to drive a luxury car, or not having to worry about major repairs 100,000 miles down the road. With only a few months left on your car lease, though, you’re considering buying out your lease. How do you know if it’s time to buy your leased car or time to walk away at the end of the lease? myAutoloan is here to help. There are actually a few scenarios when buying out your lease makes the most financial “cents!”
When Should You Buyout Your Lease Car?
When your buyout amount is less than or close to its private-party value
First things first: Buying out your lease has to make financial “cents,” or sense if you want to get serious. Start by finding out your residual amount, or the buyout amount. You can find this number on your online account, monthly statement, or by calling the bank that holds your lease.
Compare this amount to the private-party value of your car. You can easily plug in the vehicle details on Kelley Blue Book to get this amount. If your buyout amount is pretty close to (or fingers crossed, less than) the private-party value, it might make financial sense to buyout your car lease.
When you’ve gone over your lease mileage limits
Car leases come with a limit on the number of miles the car can be driven. This limit is typically 12,000 miles per year over a 3-year lease, but it can vary. If you’ve exceeded your lease mileage limits, buying your car might be a better financial route than returning it at the end of the lease. Why? The leasing company is going to charge you for every extra mile on the odometer. Check your lease for the penalty amount. It could be as much as $0.25 per mile. If you buy the car, you won’t be penalized for going over the allowed miles.
When the car has definitely seen better days
Did you drive your leased car like an Indy 500 racer? Like Thelma and Louise on their fatal cross-country adventure? Like any driver in one of the Fast and Furious movies? You get the point. If you put the pedal to the metal, then there’s a good chance your leased car has excess wear and tear. The bigger the damage, the bigger the penalty. If you buy your leased car, you won’t be penalized for dinging, denting, scratching, or staining the interior or exterior of the car.
When you really, really, really like your car
Not everyone makes decisions from a financial standpoint. Some people let their emotions or preferences guide their choices, and that’s okay, too. If you adore your leased car and can’t imagine letting it go, then buying your leased car makes sense. Follow your heart and keep the car!
When you don’t want to hassle with car shopping
You’re essentially starting from ground zero after you turn in your leased car. Time to start researching car models, comparing prices, planning trips to the car lot, and dealing with aggressive salespeople. With your leased car, you know exactly what you’re getting. You know your vehicle’s history including how and where it’s been driven, what it’s been used for, and how often it has been maintained. When you buy a car you’re already familiar with, you can driver easier and sidestep the many headaches that come with car shopping.
Apply for a lease buyout loan
When you love your car but not your lease, go with a lease buyout. The dealer will typically contact you about buying the leased vehicle near the end of your lease term. You can accept the dealer’s offer, decline, or negotiate a better price. Yes, you heard us. You may be able to negotiate a great low price on the vehicle you already know and love.
Review the terms of your lease contract and and when you’re ready, apply with myAutoloan to see up to four lease buyout loans in a matter of minutes!