Lease Residual Value Calculator
Calculate the residual value of a leased vehicle based on MSRP and residual percentage. Understand how residual affects your monthly lease payment.
Lease Buyout Calculator
Calculate the total cost to buy your leased vehicle at lease end. See the buyout price including residual value, purchase option fee, and sales tax.
Listed on your lease agreement
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$
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Check KBB, Edmunds, or Carvana
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$
$
Financing
%
Buyout Before Tax⧉
$22,400.00
Residual + purchase option fee
Sales Tax⧉
$1,568.00
At 7% tax rate
Total Buyout Cost⧉
$23,968.00
Pre-tax amount + sales tax
All-In Cost⧉
$24,468.00
Buyout + registration + inspection
Equity Position⧉
$1,532.00
Positive equity — great deal
Equity %⧉
5.89%
Equity as percentage of market value
Monthly Payment⧉
$473.47
60-month loan at 6.9% APR
Total Interest⧉
$4,439.91
Over 60 months of financing
Equity Gauge
$1,532.00
Negative EquityPositive Equity
Cost Breakdown
| Item | Amount | % of Total |
|---|---|---|
| Residual Value | $22,000.00 | 76.10% |
| Purchase Option Fee | $400.00 | 1.38% |
| Sales Tax | $1,568.00 | 5.42% |
| Registration / Title | $350.00 | 1.21% |
| Pre-Purchase Inspection | $150.00 | 0.52% |
| Loan Interest | $4,439.91 | 15.36% |
| Total | $28,907.91 | 100% |
Buy vs. Return Comparison
| Factor | Buy Out | Return Lease |
|---|---|---|
| Upfront Cost | $24,468.00 | $0.00 |
| Asset Ownership | Yes | No |
| Estimated Asset Value | $26,000.00 | — |
| Net Equity | $1,532.00 | — |
| Excess Wear Charges | None | $500–$2,000+ |
| Mileage Penalties | None | $0.15–$0.30/mi |
| Disposition Fee | None | $300–$500 |
First-Year Amortization Schedule
| Month | Payment | Principal | Interest | Balance |
|---|---|---|---|---|
| 1 | $473.47 | $335.65 | $137.82 | $23,632.35 |
| 2 | $473.47 | $337.58 | $135.89 | $23,294.77 |
| 3 | $473.47 | $339.52 | $133.94 | $22,955.25 |
| 4 | $473.47 | $341.47 | $131.99 | $22,613.78 |
| 5 | $473.47 | $343.44 | $130.03 | $22,270.34 |
| 6 | $473.47 | $345.41 | $128.05 | $21,924.93 |
| 7 | $473.47 | $347.40 | $126.07 | $21,577.54 |
| 8 | $473.47 | $349.39 | $124.07 | $21,228.14 |
| 9 | $473.47 | $351.40 | $122.06 | $20,876.74 |
| 10 | $473.47 | $353.42 | $120.04 | $20,523.31 |
| 11 | $473.47 | $355.46 | $118.01 | $20,167.86 |
| 12 | $473.47 | $357.50 | $115.97 | $19,810.36 |
Planning notes, formulas, and examples
About the Lease Buyout Calculator
At the end of your lease, you have the option to purchase the vehicle at its predetermined residual value. If the car's market value exceeds the residual, buying it can be a smart financial move. If the market value is below the residual, you're better off returning it.
The total buyout cost includes the residual value, a purchase option fee (typically $200–$500), and sales tax. Some lessees also finance the buyout with a new auto loan, adding interest costs to the equation.
This calculator helps you determine the total out-of-pocket cost to buy your leased vehicle and compare it to the car's current market value to see if it's a good deal.
When This Page Helps
Knowing the exact buyout cost lets you compare it to the car's market value. If the buyout is less than what the car is worth, you're getting a bargain. You also avoid disposition fees, mileage penalties, and wear charges by buying.
How to Use the Inputs
- Enter the residual value from your lease contract.
- Enter the purchase option fee (check your lease agreement).
- Enter your state sales tax rate.
- Optionally enter the car's current market value (from KBB, Edmunds, etc.).
- Review the total buyout cost and equity analysis.
Formula used
Total Buyout = Residual Value + Purchase Fee + Sales Tax
Sales Tax = (Residual + Purchase Fee) × Tax Rate
Equity = Market Value − Total BuyoutExample Calculation
Result: Buyout: $23,915 | Equity: $1,085
Residual: $22,000 + Purchase fee: $350 = $22,350. Sales tax at 7%: $1,564.50. Total buyout: $23,914.50. If the car's market value is $25,000, you have $1,085 in instant equity — buying is a good deal.
Tips & Best Practices
- Compare the buyout price to KBB, Edmunds, and Carvana offers for your exact car.
- If the car is worth more than the residual, buying protects that equity.
- Buying avoids disposition fee, mileage penalty, and wear charges.
- You can finance the buyout with a separate auto loan from a bank or credit union.
- Some manufacturers offer early buyout incentives before the lease ends.
- If selling the car after buying, you may owe capital gains in some states.
Evaluating the Buyout
The key question is whether the car's market value exceeds your total buyout cost. Check multiple sources: KBB, Edmunds, CarGurus, Carvana, and CarMax. If the market value is $2,000+ above your buyout, buying and either keeping or selling the car makes financial sense.
Added Benefits of Buying
Beyond the financial equation, buying your lease avoids disposition fees ($300–$500), excess mileage charges, and wear-and-tear penalties. You also already know the car's complete history, which eliminates the uncertainty of buying a used car.
Financing the Buyout
Credit unions often offer the best rates for lease buyout loans. Get pre-approved before committing to the leasing company's financing offer. The loan amount is the total buyout price minus any down payment you choose to make.
Sources & Methodology
Last updated:
Frequently Asked Questions
A lease buyout is purchasing your leased vehicle at the end of the lease term (or sometimes early) at the residual value plus applicable fees and taxes. It's an option in virtually every lease contract.
The buyout price is the residual value (set at lease signing) plus a purchase option fee ($200–$500). This doesn't change regardless of the car's actual market value, which is what creates buyout opportunities.
When the car's current market value exceeds the residual value by more than the fees and taxes. In strong used car markets, this is common. Also consider buying if you'd face high return penalties.
Yes. You can get a standard auto loan from a bank, credit union, or the leasing company. Shop around for the best rate. Some lenders specialize in lease buyout financing with competitive rates.
Most leases allow early buyout, but the payoff amount includes remaining payments plus the residual. This is usually more expensive than waiting until lease end. Check your contract for the early buyout formula.
Some leasing companies allow you to sell directly to a third party or dealer. Others require you to purchase the car first, then sell it. This can be profitable if market value significantly exceeds the residual.
More in this topic
Lease Disposition Fee Calculator
Calculate the total end-of-lease costs including disposition fee, mileage penalty, and excess wear charges. Plan for lease return expenses.
Lease vs Buy Calculator
Compare the total cost of leasing versus buying a car over the same period. See which option saves more based on your down payment, rate, and term.