When Austin drivers’ leases are about to expire, they have two options. They can either return the automobile to the dealership and settle any remaining fees, or they can negotiate a car lease buyout. You’re probably wondering, “What is a lease buyout?” The simple lease buyout definition is when a dealership allows you to purchase the vehicle at or before the end of a lease contract for the price of its remaining value. There are two types of car lease buyout options available, so it’s important to know which option is best for you. Read this guide on how a car lease buyout works with Toyota of Cedar Park.
Most drivers who lease in Leander choose this option. The lease-end buyout requires that you pay what the vehicle is expected to be worth by the end of the lease period. This price is normally agreed upon before you sign the lease agreement. A lease-end buyout is a good option if:
- You’d like to stick with the vehicle you’re currently leasing
- 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 prefer to drive
- You can get a good interest rate to finance the buyout price
Another perk of the lease-end buyout is that you have knowledge of the condition and history of the vehicle you’ve been leasing, which isn’t the case when purchasing a different used car.
Early Lease Buyout
This option allows you to purchase your automobile before the end of the lease contract. Keep in mind that not all lease contracts allow this, so you’ll want to check beforehand if this is a viable option for you. Beforeknow considering an early lease buyout, it’s important to make 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 lease-end residual value on your original contract
- The amount you still owe on the lease
- If the vehicle has significantly depreciated and is below market value, you might have to pay the difference
Drivers often consider this lease buyout option when worried about lease penalties such as going over mileage, not maintaining scheduled services, or damages to the interior or exterior of the vehicle.
How Does a Lease Buyout Work?
How does a lease buyout work? If you’re looking to own your vehicle you think a car lease buyout is a good option for your financial circumstances, here are the beginning steps that you can take:
- Contact your leasing institution. When you get closer to the end of your lease, contact your leasing institution to inquire about your options. They will detail how a car lease buyout works with them, including any fees that are associated with the buyout process.
- If you’ll be financing the buyout, apply for pre-approval. Are you planning on financing your lease buyout? If so, now is a good time to apply for pre-approval with a few lenders to see how you qualify. You can often secure financing through the same dealership you have your lease with, but you can always explore other options.
- Negotiate and finalize the buyout. You may have the opportunity to negotiate your car lease buyout and get a lower price. Once you’ve settled on a number that you’re comfortable with and secure financing, your buyout is complete!
Learn More About Leasing at Toyota of Cedar Park
Now that you know how a car lease buyout works, is this option right for you? If you still aren’t sure whether a car lease buyout works for your driving lifestyle and financial circumstances, contact Toyota of Cedar Park today. Our experts will walk you through your options to help you determine if a car lease buyout is suitable for you.