Vehicle EconomicsLease Buyout vs Comparable Used Car
Is buying out your known lease cheaper than buying a specific comparable used car instead?
Why this comes up
Buy Lease vs Return It compares the buyout against a generic replacement scenario built from flat annual guesses. This engine is for when you have an actual comparable used car in mind, with its own real price, down payment, financing, and expected resale value, and want the specific comparison, not a generic one.
How we calculated this
The buyout side totals the buyout fees plus ongoing ownership costs, financing interest only if you finance the buyout. The comparable side finances its price minus your down payment with real amortization, and treats its price minus expected ending value as real depreciation, plus its own ongoing costs and transaction costs. Whichever total is lower wins.
Worked example, using this page's own defaults: buying out the lease totals$17,950 over 3 years, the comparable used car totals$23,724.98, so the buyout wins by $5,774.98.
What this means
- Paying more for the known car can be rational only within a defined premium, not because familiarity is automatically worth a dollar amount, check the break-even price below.
- The comparable's expected ending value drives its depreciation cost heavily, a soft estimate here can flip the result.
- If neither option is a specific vehicle yet, use Buy Lease vs Return It for a faster, less detailed comparison.
Limitations
Both vehicles' future ending values are your own planning estimates, not appraisals or forecasts. See Methodology.
Methodology
This engine combines Vehicle Economics' fixed-rate amortization model (the standard loan-payment formula run out as a full month-by-month schedule), ownership total cost model (every ownership cost, depreciation, financing, fuel, insurance, maintenance, repairs, and fees, summed over your horizon), lease payment and buyout model (cap cost, residual, and money factor split into a depreciation charge and a rent charge), and break-even search model (a closed-form solve where one exists, otherwise a bounded search over a stated plausible range). See Methodology for the full detail.