Loans
Car Lease Buyout Calculator
Your lease's buyout price was set years ago, when the leasing company guessed what the car would be worth today. If it guessed low — as often happens — the buyout sits below market value, and keeping the car means buying an asset for less than it is worth.
Tested against worked examplesHow we verify
The residual value in your lease contract.
What the car would sell for — check a valuation guide for your exact trim and mileage.
0 to pay cash.
Instant equity if you buy: $1,182
Instant equity if you buy
$1,182
The car is worth more than the all-in buyout cost.
The buyout is below market, so keeping the car is a genuinely good deal — you could even buy it and sell it for a gain. This has been common when used-car prices ran higher than lease residuals anticipated. Confirm the market value for your exact trim and mileage before deciding.
- Buyout price
- $18,000
- Sales tax
- $1,468
- All-in buyout cost
- $19,818
- Market value
- $21,000
Compare scenariosTry three values of one input
| Buyout price (residual) | |||
|---|---|---|---|
| Instant equity if you buy | $3,342 | $1,182−$2,160 | $978−$2,364 |
| Buyout price | $16,000 | $18,000+$2,000 | $20,000+$4,000 |
| Sales tax | $1,308 | $1,468+$160 | $1,628+$320 |
| All-in buyout cost | $17,658 | $19,818+$2,160 | $21,978+$4,320 |
Every other input stays at the value you set above — currently $18,000 for buyout price (residual). Differences are measured against the first column.
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How this calculator works
The all-in buyout cost is the residual plus the purchase fee plus sales tax on that total. Equity is the car's market value minus that cost — positive means you are buying below market. If financed, the monthly payment amortises the total over the term at the rate, and the total-if-financed shows the interest added.
Market value is yours to supply and is the input that most affects the answer — use a valuation guide for your exact trim, mileage, and condition, not a rough guess. Sales-tax treatment of buyouts varies by state and is modelled as a simple rate on the buyout; some states credit tax already paid on the lease.
What this assumes
- The buyout price is the residual plus any purchase-option fee stated in your contract, not a negotiated figure.
- The car's market value is the figure you enter; a dealer appraisal may differ.
- Sales tax on the buyout is excluded unless entered, and it applies in most states.
What changes this number
- Market value versus residual
- The whole decision. If the car is worth more than the buyout price, the equity is yours rather than the lessor's.
- Condition and mileage
- Excess-wear and mileage charges at return are avoided entirely by buying, which can swing the comparison.
- Financing rate on the buyout
- A buyout loan is a used-car loan and priced accordingly, typically above a new-car rate.
A worked example
Take the buyout below market scenario. These figures are produced by the calculator above, not written alongside it, so they always match what the tool returns.
What you enter
- Buyout price (residual)
- $18,000
- Current market value
- $21,000
- Sales tax rate
- 8%
What it returns
- Instant equity if you buy
- $1,182
- Buyout price
- $18,000
- Sales tax
- $1,468
- All-in buyout cost
- $19,818
- Market value
- $21,000
The buyout is below market, so keeping the car is a genuinely good deal — you could even buy it and sell it for a gain. This has been common when used-car prices ran higher than lease residuals anticipated. Confirm the market value for your exact trim and mileage before deciding.
Try an example
Frequently asked questions
Should I buy out my car lease?
Compare the buyout price, plus sales tax and fees, against what the car would sell for today. If the buyout is below market, keeping the car means buying an asset at a discount — a clear win. If it is above market, hand the car back and buy something else if you need a car.
Why is the buyout sometimes below market value?
Because the residual value was set at lease signing, years ago, as a forecast of today's worth. When used-car prices rise faster than expected — as they did sharply in the early 2020s — the contractual buyout can end up well below what the car actually fetches, handing the lessee instant equity.
Do I pay sales tax on a lease buyout?
Usually yes, on the buyout price, though the rules vary by state and some credit the tax you already paid on the lease payments. It is a real cost that can add over a thousand dollars, so include it when comparing the buyout to market value rather than judging on the sticker residual alone.
Can I finance a lease buyout?
Yes — lease-buyout loans are common and work like any auto loan. If your credit has improved since you leased, the rate can be reasonable. Factor the interest into the total cost, and remember that financing a buyout above market value just spreads a bad deal over more months.
Should I buy it just to resell it?
If the buyout is well below market, some people buy the car and immediately sell it, pocketing the difference. It works, but watch for lease terms restricting third-party buyouts, the sales tax you pay on the purchase, and any gain that could be taxable. The margin has to clear those costs.
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Disclaimer: DayCents provides this calculator for educational purposes only. Results are estimates based on your inputs and the stated assumptions — they are not financial advice, a quote, or an offer of credit. Consult a qualified financial professional before making major money decisions.