Estimate the total cost to purchase your leased vehicle today or at lease-end.
$
$
$
$
Buyout Summary
Base Buyout Amount:$-
Remaining Payments Total:$-
Estimated Sales Tax:$-
Fees (Purchase & Reg):$-
Estimated Total Price:$-
How to Calculate Your Lease Buyout
A lease buyout occurs when you decide to purchase the vehicle you've been leasing instead of returning it to the dealership. Understanding the true cost involves more than just looking at your monthly bill.
The Lease Buyout Formula
To determine the total price you will pay, use the following calculation:
Total Cost = Residual Value + (Monthly Payment × Remaining Payments) + Fees + Sales Tax
Residual Value: This is the predetermined value of the car at the end of the lease, found in your original lease agreement.
Remaining Payments: If you are buying the car early, you are usually responsible for the remaining depreciation payments.
Purchase Option Fee: Most leasing companies (lessors) charge a fee (disposition or purchase fee) to process the sale.
Sales Tax: In most states, you must pay sales tax on the purchase price of the vehicle when you buy it out.
When Should You Buy Out Your Lease?
Buying out a lease makes financial sense in several specific scenarios:
Equity: If the current market value of the car is higher than the residual value stated in your contract.
Condition: If you have excessive wear and tear or have gone way over your mileage limit, buying the car avoids heavy penalties.
Reliability: You know the full maintenance history of the vehicle because you've been the only driver.
Example Calculation
Suppose your car's residual value is $20,000. You have 2 payments left at $400 each. Your state has a 7% sales tax, and the purchase fee is $350. Your registration fees are $250.
Base Purchase Price: $20,000 + ($400 × 2) = $20,800
Sales Tax: $20,800 × 0.07 = $1,456
Fees: $350 + $250 = $600
Total Buyout: $22,856
function calculateLeaseBuyout() {
var residualValue = parseFloat(document.getElementById('residualValue').value) || 0;
var monthlyPayment = parseFloat(document.getElementById('monthlyPayment').value) || 0;
var remainingPayments = parseFloat(document.getElementById('remainingPayments').value) || 0;
var purchaseFee = parseFloat(document.getElementById('purchaseFee').value) || 0;
var salesTaxRate = parseFloat(document.getElementById('salesTax').value) || 0;
var miscFees = parseFloat(document.getElementById('miscFees').value) || 0;
if (residualValue <= 0) {
alert("Please enter a valid Residual Value.");
return;
}
// Calculation Logic
var totalRemainingPayments = monthlyPayment * remainingPayments;
var subtotalForTax = residualValue + totalRemainingPayments;
var calculatedTax = subtotalForTax * (salesTaxRate / 100);
var totalFees = purchaseFee + miscFees;
var totalBuyout = subtotalForTax + calculatedTax + totalFees;
// Display Results
document.getElementById('resBase').innerText = '$' + residualValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resPayments').innerText = '$' + totalRemainingPayments.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resTax').innerText = '$' + calculatedTax.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resFees').innerText = '$' + totalFees.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resTotal').innerText = '$' + totalBuyout.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('lbcResult').style.display = 'block';
}