End of lease options: what to do when your car lease ends
When a car lease ends, you can return the car, buy it, sell or trade it for any equity, extend the lease, or move into a new car early through a pull-ahead offer.
When your lease ends
Return it, buy it, sell it or extend it. Three numbers decide which.
Return it
Turn it in at a dealer of the brand. Pay the disposition fee plus any excess mileage and wear charges.
Best whenthe car is worth less than the payoff and you are within your miles
Buy it
Pay the purchase option price in your contract plus tax and fees, cash or financed, and keep the car.
Best whenthe car is worth more than that total, or you are far over your miles
Sell or trade it
A dealer or buyer pays off the lease and you keep the difference. Your lender's rules decide who can buy.
Best whenthe car is worth more than the payoff
Extend it
Many lenders allow a short extension, month to month or for a fixed period, often at the same payment.
Best whenyour next car is not ready, or you are still deciding
You can also leave before the end through a pull-ahead offer, an early sale, a transfer or an early buyout.
Key takeaways
Your end of lease options narrow quickly once you know three numbers: your payoff, what the car is worth, and what returning it would cost in fees, mileage and damage charges. Start about 90 days before the maturity date, because payoff quotes, inspections and a replacement car all take time to line up.
Your end of lease options at a glance
Return the car. Turn it in at a dealer of the brand, sign the odometer statement and pay the disposition fee plus any excess mileage and wear charges. Best when the car is worth less than the payoff and you are within your miles. See returning a leased car.
Buy it. Pay the purchase option price in your contract plus tax and fees, cash or financed. Best when the car is worth more than that total, when you are far over your miles, or when you simply want to keep it. See lease buyout.
Sell or trade it. If the car is worth more than the payoff, a dealer or buyer pays off the lease and you keep the difference. Your lender's rules decide who can buy it. See lease equity.
Extend the lease. Many lenders allow a short extension, month to month or for a fixed period, often at the same payment. Useful when your next car is not ready. See lease extension.
Lease or buy another car from the same brand. Staying with the brand's finance company often gets the disposition fee waived, and loyalty offers may apply. See loyalty and conquest offers.
Leave before the end. A pull-ahead offer, an early sale, a transfer or an early buyout can end the lease months early. See getting out of a lease early.
The three numbers that decide your end of lease options
Your payoff. At maturity, this is the purchase option price in your contract plus any purchase option fee. Get it in writing from the lender, and ask whether a dealer's payoff differs from yours.
The car's value. Get written offers in the same week from a dealer of your brand, a dealer of another brand and an online buyer.
The cost of returning it. The disposition fee, plus the miles over your allowance times the contract's per-mile rate, plus the damage charges a pre-inspection finds. In California, sales tax applies to the mileage and wear charges.
Then the choice mostly makes itself:
Value above payoff: sell or trade the car, or buy it if you want to keep it. Returning it hands the difference to someone else.
Value below payoff, car clean and within miles: return it and move on.
Value below payoff, but big mileage or damage charges: compare the buyout with the return cost; buying ends those charges, so it can win even when the car is not worth the payoff.
Next car not ready, or still deciding: ask for an extension before the maturity date.
Example, with made-up round numbers: your payoff is $26,000 and the best written offer is $28,000, so selling nets $2,000. Returning the car would cost a $400 disposition fee and $900 in mileage charges. Selling puts you $3,300 ahead of returning it.
The three numbers that decide
Payoff, value and the cost of returning. Get all three before you choose.
- 1Your payoffAt maturity, the purchase option price plus any purchase option fee. Get it in writing from the lender.
- 2The car's valueWritten offers in the same week from a dealer of your brand, a dealer of another brand and an online buyer.
- 3The cost of returning itStarts with the disposition fee, then adds mileage and the damage charges a pre-inspection finds.
- 4Miles over your allowanceBilled at the contract's per-mile rate. In California, sales tax applies to mileage and wear charges.
End of lease options timeline: six months out to the final bill
Four to six months out
Check your odometer against your allowance and project where you will finish. Ask whether a pull-ahead offer applies to your contract. If your next car may need to be ordered, start shopping now. Some lenders start early: Mercedes-Benz Financial Services says its return process begins about four months before maturity.
90 days out
Get a written payoff, collect offers on the car, and ask the lender how and when to book the pre-inspection. Toyota Financial Services, for example, suggests about 60 days before the return.
60 days out
Have the pre-inspection done, get quotes for anything it flags, and make the decision. If you are buying, apply for financing. If you are extending, request it now rather than on the last day.
30 days out
Book the turn-in appointment or the sale, confirm delivery of your next car, and gather every key, manual and accessory.
Turn-in day and after
Sign the odometer statement and turn-in receipt, keep copies and photos, and keep insurance until the lender confirms it has the car. Check the final invoice line by line when it arrives.
Pull-ahead offers
A pull-ahead offer is a carmaker program that waives some of your remaining payments if you return your leased car early and lease or buy a new car of the same brand through its finance company. The programs come and go, and each one sets its own rules: which contracts qualify, how many months before maturity you can use it, and whether mileage, damage and disposition charges still apply. A pull-ahead is worth it only if the payments waived are real money and the new deal is priced as well as it would be without the offer. Ask for the terms in writing, including the exact payments waived, before you choose the new car.
End of lease options in California
Buying is taxed. A buyout is taxed at the rate for your registration address, and tax you paid on lease payments does not count against it. Reselling within ten days of receiving the title removes the tax on your buyout.
Trading in saves no tax. A trade-in allowance does not reduce the sales tax on your next car in California, so compare cash and trade offers dollar for dollar.
Dealers must pay off your lease on time. A dealer that takes your leased car in trade must pay off the lease within 21 calendar days.
Early exits are capped. For a personal lease, California limits what a lender can charge when you end early, buy early or trade early.
What to ask your lender
What is my purchase option price and my payoff for my chosen date, and is a dealer's payoff different?
Who is allowed to buy the car: only me and your brand's dealers, or any dealer?
How do I book the pre-inspection, and when should it happen?
What does the disposition fee waiver require?
Can I extend, for how long, and at what payment?
Is my contract eligible for a pull-ahead offer right now?
How 021 helps
When your next car comes through 021, we can take care of the current lease as well. Most often a dealer in our network takes it in trade and any equity can go toward the next car, and we can also handle the return, a buyout or a lease transfer.
021 Auto Leasing is a California-licensed auto broker. If your next step is a new car, a dedicated specialist gets several dealers to quote the same car and gives you one written quote, with payment, drive-off, term, miles, taxes, fees and 021's fee, before you agree to anything. In-stock cars can go from inquiry to keys in under 48 hours, which helps when your end date is close. Start with My lease is ending.
The last three months
Start about 90 days before the end date. Quotes, inspections and a new car take time.
90 daysbefore the end
Get your numbers
- Get a written payoff
- Collect offers on the car
- Ask the lender how and when to book the pre-inspection
60 daysbefore the end
Inspect and decide
- Have the pre-inspection done
- Get quotes for anything it flags
- Buying? Apply for financing
- Extending? Request it now, not on the last day
30 daysbefore the end
Book it
- Book the turn-in appointment or the sale
- Confirm delivery of your next car
- Gather every key, manual and accessory
Turn-inand after
Sign, keep copies, check the bill
- Sign the odometer statement and turn-in receipt
- Keep copies and photos
- Keep insurance until the lender confirms it has the car
- Check the final invoice line by line
Four to six months out: check your miles against your allowance and ask whether a pull-ahead offer applies.
Common questions
What is the best thing to do at the end of a car lease?
Can you negotiate at the end of a lease?
Does returning a lease hurt your credit?
Is it a good idea to buy your leased car?
What is a lease pull-ahead?
021 Auto Leasing is a licensed California autobroker (license #82402). All new cars arranged for sale are subject to price and availability from the selling franchised new car dealer.