Lease Buyout Calculator

What this computes

Still mid-contract? The answer changes — leaving early also cancels the payments you haven't made yet. Use the early lease exit calculator instead.

The leasing company set your residual price years ago, based on a forecast of where used values would land. Today, the actual used market either agrees, exceeds it (you have equity), or falls short (the buyout is above market). The decision to buy out or return is one comparison: all-in buyout cost vs current market value.

The math

buyoutTotal = buyoutPrice + buyoutPrice·taxRate + fees
equity      = marketValue − buyoutTotal

Positive equity means you're paying less than the market asks for the equivalent used car. Negative equity means you'd overpay relative to just buying the same year/mileage used elsewhere.

A "great deal" buyout is one where the residual was set conservatively years ago, and the market disagreed in your favor. Check before you sign anything.

How to use this

1. Read the buyout price off the contract (sometimes called residual or purchase-option price), plus the listed purchase-option fee.
2. Get a real market value for your exact year, mileage, and trim from a used-price guide. Don't use a generic figure.
3. Add your state's sales tax rate. Most states tax the buyout price; a few don't tax lease buyouts the same way as a new purchase — confirm locally.
4. Decide on equity, not feelings. "I love this car" isn't a reason to overpay; "I know its history" is worth real money but rarely more than $500-1000.
5. Add back what returning the car would cost you. Excess mileage and wear charges only apply on a return — buying cancels them. If you're over the cap, size that bill in the lease mileage overage calculator and treat it as equity on the buy side, because it's money you avoid rather than spend.

The mileage adjustment most people skip

A buyout price is fixed at signing; the car's market value is not, and mileage moves it hard. Two identical cars, one at 30,000 miles and one at 55,000, are not worth the same — so a high-mileage lease usually faces a residual set for a car that no longer exists, which pushes equity negative.

That cuts both ways, and both belong in the decision. Returning it triggers the excess-mileage charge, often four figures. Buying it waives that charge but hands you a car worth less than the residual assumed. Run both numbers: the right answer is whichever loss is smaller, and it is genuinely not obvious in advance.

Why residuals are sometimes well below market

• Conservative pricing at signing. Lessors prefer to be "wrong" in the direction that protects them.
• Supply shocks. The 2021-2023 used-car market saw residuals set years earlier vastly undershoot reality.
• Strong-resale models. Trucks and certain Japanese brands routinely hold value above residual.
• The flip side. Luxury and many EVs often have residuals above market — those are no-equity returns.

What this calculator doesn't model

• Excess-wear / mileage-overage charges you'd pay if you return the car.
• State tax oddities. A few states have unusual buyout-tax rules; confirm locally.
• Financing the buyout. Interest cost adds to total if you borrow — see Auto Loan.
• Negotiation. The buyout price is sometimes negotiable, especially with third-party leasing companies — try before assuming the residual is fixed.