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Should I Buy My Leased Car? 5 Times to Say Yes
If you like the car, don't want the hassle of car shopping and confirm a fair price, that can be reason enough.
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The buyout option at the end of a car lease can be an attractive opportunity or a tool for damage control.
Essentially, you're buying a used car you know and like, for a price set by the leasing company at the beginning of your contract. If you’re anticipating extra fees and penalties, buying the car can cut your losses. Or, if market conditions have changed since you signed the lease and you’ve lightly driven the car, you could benefit from any hidden lease equity in the vehicle.
Here are some reasons you might decide to keep your leased vehicle instead of turning it back in.
NerdWallet's ratings are determined by our editorial team. The scoring formula takes into account factors like maximum rates, variety of loan options, visibility of borrower requirements, accessibility, speed of funding, fees and more.
Best for borrowers with good or excellent credit who want fast approval and funding to buy a new car.
NerdWallet's ratings are determined by our editorial team. The scoring formula takes into account factors like maximum rates, variety of loan options, visibility of borrower requirements, accessibility, speed of funding, fees and more.
4.5
Est. APR:
Annual percentage rate (APR) represents the true cost of
borrowing money. It is your interest rate plus any loan fees,
and is expressed as a percentage.
Annual percentage rate (APR) represents the true cost of
borrowing money. It is your interest rate plus any loan fees,
and is expressed as a percentage.
6.74 - 15.24%
Term: 24 - 84 months
You will be redirected to the partner's website.
The terms presented here are estimated and provided solely to assist you
in finding a great lender. The terms may vary based on the partner's terms
and conditions.
You will be redirected to the partner's website
The terms presented here are estimated and provided solely to assist you in finding a great lender. The monthly payment amount, Annual Percentage Rate (APR), and any other terms are based on standard Consumers Credit Union rates and terms for your NerdWallet provided credit score, zip code, and the other self-provided information. These terms may vary based on your credit history, your individual income, or other terms of the lender.
NerdWallet's ratings are determined by our editorial team. The scoring formula takes into account factors like maximum rates, variety of loan options, visibility of borrower requirements, accessibility, speed of funding, fees and more.
Best for applicants who want to compare multiple new car purchase loan offers.
NerdWallet's ratings are determined by our editorial team. The scoring formula takes into account factors like maximum rates, variety of loan options, visibility of borrower requirements, accessibility, speed of funding, fees and more.
4.0
Est. APR:
Annual percentage rate (APR) represents the true cost of
borrowing money. It is your interest rate plus any loan fees,
and is expressed as a percentage.
Annual percentage rate (APR) represents the true cost of
borrowing money. It is your interest rate plus any loan fees,
and is expressed as a percentage.
6.24 - 29.90%
Term: 24 - 84 months
You will be redirected to the partner's website.
The terms presented here are estimated and provided solely to assist you
in finding a great lender. The terms may vary based on the partner's terms
and conditions.
You will be redirected to the partner's website
The terms presented here are estimated and provided solely to assist you in finding a great lender. The monthly payment amount, Annual Percentage Rate (APR), and any other terms are based on standard Consumers Credit Union rates and terms for your NerdWallet provided credit score, zip code, and the other self-provided information. These terms may vary based on your credit history, your individual income, or other terms of the lender.
Auto Credit Express
New car purchase loan
Not yet rated
Best for new-car buyers who can’t qualify for a lower-rate loan through a traditional lender and need help finding a dealer with subprime lending.
Min score: 525
Amount: $5,000 - $50,000
Min. Amount$5,000
Max. Amount$50,000
Not yet rated
Est. APR:
Annual percentage rate (APR) represents the true cost of
borrowing money. It is your interest rate plus any loan fees,
and is expressed as a percentage.
Annual percentage rate (APR) represents the true cost of
borrowing money. It is your interest rate plus any loan fees,
and is expressed as a percentage.
N/A - N/A
Term: 24 - 84 months
You will be redirected to the partner's website.
The terms presented here are estimated and provided solely to assist you
in finding a great lender. The terms may vary based on the partner's terms
and conditions.
You will be redirected to the partner's website
The terms presented here are estimated and provided solely to assist you in finding a great lender. The monthly payment amount, Annual Percentage Rate (APR), and any other terms are based on standard Consumers Credit Union rates and terms for your NerdWallet provided credit score, zip code, and the other self-provided information. These terms may vary based on your credit history, your individual income, or other terms of the lender.
1. You're way over — or under — the allowed mileage
A standard lease contract is for three years and 36,000 miles total — in other words, 12,000 miles per year, although it’s possible to negotiate a higher-mileage lease. If you're over what you agreed to, you’ll pay an excess mileage fee — anywhere from about 12 to 30 cents per mile
if you're under the mileage limit, you could leave money on the table. Returning a car you drove only 10,000 miles, when you paid for 36,000 miles is like handing the dealer a big check. Instead, you could buy the car, drive it and use the value you’ve paid for. Alternatively, you might be able to buy the car and sell it for a profit. Get an appraisal at an online car buyersuch as Carvana or CarMax, to see if the low-mileage car’s value is greater than the buyout price.
Although fees alone may not be a deciding factor, they’re still something to take into consideration.
For example, buying the car will save you the disposition fee, the charge to prepare the car for resale, which is usually $350-$500.
Also check your contract for purchase option fees (typically a few hundred dollars), charged by some leasing companies, and factor that into your decision.
3. Your car has excess wear and tear
If your car has a collection of indiscretions — scrapes, dings or tears in the upholstery — you could be looking at penalties for excess wear and tear. But if you buy the car, you won’t be charged for the damage, and you can fix the bumps and bruises when, and if, you want.
4. Your car is worth more than its buyout price
In some cases, your car may increase in value for reasons not anticipated when the buyout price was set. If the car is worth more than the buyout price in the lease agreement, it can provide an opportunity to buy the car, sell it and pocket the difference.
On the other hand, if your car’s market value is less than the buyout price, it typically isn’t a good idea to buy it. However, you might consider buying it if the leasing company is willing to negotiate and lower the buyout price. A lender may do this to eliminate its own shipping and auction fees on a vehicle it isn't likely to sell at a profit.
Buying a car you’ve driven for several years provides peace-of-mind in knowing you’re getting a car you enjoy driving. You also know the car’s history and whether it’s been well cared for.
Keeping the car helps you avoid the hassle of shopping for a new one. And, if you’ve leased for years, getting a lease buyout loan can be a path to eventually eliminating monthly payments.
Keep in mind, however, that the car’s bumper-to-bumper factory warranty — typically three years or 36,000 miles — may have expired. But the powertrain warranty, covering major parts like the engine, transmission and suspension, might still be in effect. When buying your leased vehicle, check to see what warranty coverage remains.
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