LeaseLoco

Can I Buy My Lease Car?

  • By Michael McKean
  • 6 min read

It's not impossible.

Notes and Pound coins.

► Uncommon, but still possible

► Involves fees

► Extending your lease is also possible

The end of your lease is approaching, but for whatever reason, you want to hold onto the vehicle for good, so you find yourself asking: can I buy my leased car?

Good news is that buying a leased car is sometimes possible, even if it basically defeats the point in leasing, so it's uncommon in the industry.

Uncommon, but not unheard of. So in this post, we'll be telling you more about how it's done, what it can cost and whether or not it could be the right option for you.

Can You Buy a Lease Car?

Usually not.

Because leasing (Contract Hire) is basically like a long-term rental, meaning that a lease agreement typically isn't designed for you to be able to buy and keep the vehicle at the end of the contract. Otherwise, there wouldn't be an awful lot to differentiate them from a Hire Purchase Agreement (HP) and a Personal Contract Purchase Agreement (PCP).

But sometimes you'll be able to. The official name for it is a lease buyout.

It's far from the norm though and it's really up to the discretion of the individual leasing company. A contract.

How Does a Lease Buyout Work?

No magic tricks here. Just contact your leasing company and ask them whether they'll let you buy the leased car.

Or if you're lucky, your lease agreement or lease contract might even include a lease buyout or purchase price clause option for just this very scenario. In which case, just follow the steps (one of which will probably be you contacting them).

What's the Catch?

If the leasing company gives you the go-ahead, chances are that there'll be some fees to pay.

You'll need to cover the vehicle's residual value (the figure the leasing company gave you at the start, estimating the vehicle's value at the end of the contract), plus any of the remaining lease payments on your existing contract, as well as sales tax for the purchase and a disposition fee to the dealership.

Unfortunately, all of the monthly payments that you've already made on the lease vehicle can't go towards buying it, meaning you'll need to either summon that cash separately yourself or secure some sort of financing that will cover the lease buyout price.

When is it a Good Idea to Buy Your Leased Car?

There's lots of times when it might make sense, but here are the main ones:

You Like the Car and took Good Care of it

Arguably the most obvious reason here.

So why give it up, right? And assuming you've took good care of it, stuck to the factory maintenance schedule and haven't been running it into the ground, you needn't worry about it breaking down anytime soon.

You Want to Avoid the Hassle of Car Shopping

Whilst the Internet can help dumb down the car-shopping experience and make things easier, sometimes more choice means more stress.

And maybe you're not the person who really enjoys the mental thrill of scrolling through troves of deals and websites to find the perfect match, and just want to take a less hassle-filled path with the car you've already been driving.

New and Used Car Prices are Higher

Higher than leasing, that is.

Having the funds ready to buy a car outright can be tough even at the best of times, but even more so now that car manufacturers are struggling to keep up with new car demand. And the current electric car microchip shortage makes things difficult for electric cars too, adding up to an often bleak picture.

And because of the short supply of new cars, not as many used cars are making it to dealers' lots either, meaning that prices there can spike too.

You Can Buy the Car for Less Than it's Worth

Never a bad option, as you'll be able to save money AND have the possibility of selling it on at a decent price further down the line.

When you first got the leased car, you would have signed a lease contract specifying what the vehicle was expected to be worth at the end of the contract hire agreement. This is essentially a guess made by the leasing agent, and of course, guesses can turn out to be wrong. And if that's the case, then the expected residual value could be less than what the vehicle is actually worth.

Well the good news is that it's not the current market value but instead the residual value that you'll end up paying for the vehicle.

Long story short: take advantage of it!

Can You Negotiate a Lease Buyback Price?

Not usually.

However, certain companies might be willing to bargain with you so as to avoid the time and costs involved in selling the vehicle on at auction or on the lot (who wouldn't?).

Others might be prepared to reduce the price if you finance the vehicle with them so that they can keep you as a customer.

Prove to them the difference in the car's market value and its residual value in a bid to get them to remove the purchase option fee.

Even better: if you have been pre-approved for financing with another company, use that to pressure them to match or beat the other company's price.

Can You Extend a Car Lease?

Not able to or don't want to buy your lease car?

Then renewing or extending your car lease can be a good compromise.

Companies will be less hesitant to offer you this, and again, it's a simple case of you getting in touch with them.

If you want to extend the contract on your lease car for less than 6 months, ask for an informal extension. Or for more than 6 months, ask for a formal extension.

If your request is accepted by the leasing company, they will then recalculate your monthly costs based on how long you've already been leasing the car for, and how many miles you've done during that term.

Extending your car lease can be a good option if you're waiting on a new car and need something to keep you going until it gets delivered. A car with trees in the background.

How Long Can I Renew My Lease Contract For?

Generally speaking, 12 months tends to be the maximum.

Again though, it's really up to the leasing company. It might take some begging, but renewing your contract for even longer definitely isn't impossible.

Extending a car lease can be especially useful when you are waiting on a new car and need something to keep you going until it's delivered.

Note that you can't 'stack' renewals e.g. extending the lease for 12 months, and another 12 months, etc etc, ad infinitum.

Can You Trade-In a Leased Car?

No, you can't trade-in a leased car at a dealership, though some dealers may buy your car separately – allowing you to use the funds towards a deposit for your new lease.

Summary

So yes, buying your leased vehicle is possible, but it's still far from common and you may have to make some phone calls and sign some forms to get there.

Of course, even if you're crazy about your lease vehicle, the decision to buy it should be made with the head as well as the heart. Carefully consider your budget, the condition the car's in and its cost, before putting through an offer to the car leasing company.

FAQs

Can I buy lease car UK?

If you're asking: Can you buy a leased car? Buying a leased car is sometimes possible, but still uncommon. You'll need to contact your leasing company, and they get the final say.

Can you renew car lease after 3 years?

It is often possible for you to extend your car lease agreement on your leased vehicle, no matter how far you are into your term or how long it is. Not all leasing companies are open to lease extensions though, so you're best contacting them to find out their policy.

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