Purchase a vehicle once your lease expires
You’re getting close to the end of your lease on this car, and you’re really considering keeping it. You need to do your homework to get a decent bargain, just like when you buy a used automobile.
Find out how much it will cost to buy out your lease first. Find the “purchase option price” in the contract’s fine print. A purchase-option charge of $300 to $500 plus the car’s residual value at lease end constitutes this price, which is determined by the leasing firm. A monthly finance fee plus the difference between the vehicle’s sticker price and its expected worth at the conclusion of the lease were the components that went into determining your monthly payments when you signed the paperwork. The “residual value” is the expected price of the car’s value at the end of the lease. The predicted decrease in value of the vehicle over the scheduled lease period is known as depreciation. A vehicle with a $40,000 MSRP and a 50% residual percentage, for instance, would be worth around $20,000 when the lease is over.
Finding the true worth, sometimes called the “market value,” of your car is the next step after learning how much it will cost to buy out your lease. So, what is the going rate for your vehicle? Doing some pricing research can help you settle on a solid quote. Find out what other dealers are charging for a car that is in comparable shape and has the same amount of mileage. For comprehensive pricing information, use internet pricing services like Cars.com, Edmunds.com, and Kelly Blue Book. If you look at prices from different places, you should be able to get a decent idea of what your car is worth.
The next step is to compare the two figures. In a perfect world, the residual value would be less than the retail price.
Cars that are just getting out of leases often have inflated prices, which is a real bummer.
But there’s hope. Every leasing company is aware that its vehicles have higher residual values than their market worth, so they are constantly seeking bids. A little finesse in negotiation can get you a better deal on your leased car. Negotiate aggressively until you get a price that is close to your real goal, but start with a lower amount.