Your lease payoff amount is what the leasing company will accept to end the lease and hand you the title: the residual value set in your contract, plus a purchase option fee, sales tax, and — if you’re buying before the term is up — the remaining payments and possibly an early termination charge. The exact figure comes from your lessor on a payoff quote, and it’s only useful once you compare it to what the car is actually worth on the open market.
End-of-Term Payoff vs. Early Buyout
Timing changes the math more than anything else. At the end of your lease term, the buyout starts with the residual value listed in your contract — the car’s projected worth at lease end, locked in the day you signed. If the original price was $40,000 and the residual was set at 50%, the end-of-term buyout starts at $20,000, then adds fees and tax.
Buying earlier is more expensive. You’ll generally owe the residual plus every monthly payment you haven’t made yet, and often an early termination charge on top. The earlier in the term you buy, the more remaining payments pile into the total. Federal rules require your lease to spell out either the early purchase price or the method used to calculate it, so the contract itself is the starting point for an early-buyout estimate.
How to Get Your Payoff Quote
The fastest route is your leasing company’s online account. Log in and look for a section called something like “buyout options” or “purchase quote,” and the system will generate a payoff letter immediately with every charge broken out and payment instructions attached.
If you don’t have an online account, call the customer service number on your monthly statement. Many automated phone systems will read a payoff quote once you enter your account number and send a copy by email or fax. For a trade-in or private sale, ask for a live representative who can walk through where to wire the money or mail the check and how long each method takes to post.
Have a few things in front of you before you call:
- Your lease account number, printed on any monthly statement.
- The 17-character Vehicle Identification Number, stamped on the driver’s side dashboard near the windshield and on your registration.
- A current odometer reading. Mileage over your contracted allowance can add excess-mileage charges to the payoff.
- A Social Security number or account PIN for identity verification.
What’s Inside the Payoff Number
A payoff quote is a stack of distinct charges, not a single figure. Reading each line lets you catch errors and understand which pieces are negotiable.
Residual Value
The largest component. This is the projected end-of-lease value written into your contract, and it doesn’t move with the used-car market. That’s why some buyouts turn out to be bargains and others are badly overpriced.
Remaining Payments on an Early Buyout
Buying before the term ends adds every scheduled payment you haven’t made. Each payment breaks into a depreciation charge and a rent charge, where the rent charge is the sum of the adjusted capitalized cost and residual value multiplied by the money factor in your contract.1Southeast Toyota Finance. Leasing Calculations Some lessors discount the unearned rent charges on an early buyout. They aren’t required to.
Purchase Option Fee
Most lessors tack on a purchase option fee, usually a few hundred dollars. The amount has to be disclosed in your lease agreement under federal rules,2eCFR. 12 CFR Part 1013 – Consumer Leasing (Regulation M) and the lessor can’t invent a higher one later. Check your original contract.
Early Termination Fee
Ending the lease ahead of schedule triggers a separate early termination charge. Federal law says the fee has to be reasonable relative to the actual harm the early termination causes the lessor, and the lease must disclose either the amount or the calculation method.3Office of the Law Revision Counsel. 15 USC Chapter 41, Subchapter I, Part E – Consumer Leases The required disclosure warns bluntly that “you may have to pay a substantial charge” and that “the earlier you end the lease, the greater this charge is likely to be.”2eCFR. 12 CFR Part 1013 – Consumer Leasing (Regulation M)
Sales Tax
You owe sales tax because the buyout is a vehicle purchase. In most states the tax is calculated on the residual value rather than the car’s original price, since you’ve already been paying tax on your monthly payments through the term. Rates and credits vary, so confirm with your state tax authority.
Disposition Fee
Your contract probably lists a disposition fee of a few hundred dollars that covers prepping and reselling the car when you return it. It’s almost always waived when you buy, because the lessor isn’t reselling anything. Confirm with your leasing company if you see it referenced on the quote.
If any charge on the payoff doesn’t match what’s in your original lease, push back. The lessor is bound by the terms disclosed at signing.2eCFR. 12 CFR Part 1013 – Consumer Leasing (Regulation M)
How Long the Quote Is Good For
A payoff quote is a snapshot. Most are valid for 7 to 15 days, and some lenders stretch to 30. That window exists because the rent charge on a lease accrues daily, so every day past the expiration changes what you owe.
Payoff letters usually include a per diem — the daily dollar amount added to the balance after the quote date. If your payment will arrive a few days late, multiply the per diem by the extra days and add that to what you send. Underpaying by even a small amount can mean the leasing company holds the title until the balance is zero. On the day you send the money, call and confirm the exact figure the lessor needs to receive.
Is the Buyout Worth It?
The payoff number alone tells you nothing about whether to pay it. What matters is the gap between that number and the car’s current market value.
Pull a market value from Kelley Blue Book, Edmunds, or your bank’s vehicle valuation tool, using your exact mileage, trim, and condition. Then compare it to the total payoff including fees and tax. If comparable cars sell for $28,000 and your payoff is $22,000, you have roughly $6,000 in equity and the buyout is a strong move. If the market value is $18,000 and the payoff is $22,000, you’d be overpaying by $4,000 compared with buying the same car elsewhere.
Skipping this comparison is where people lose money. A residual that looked reasonable three years ago can be far off the market in either direction today.
Selling to a Dealer or Third Party
If the plan is to flip the car to a dealership or online buyer rather than keep it, read your contract before you line anything up. A growing number of captive finance companies — the lending arms of manufacturers like BMW, Audi, Honda, GM, and Ford — restrict or block third-party lease buyouts. Some only allow the lessee or a same-brand franchised dealer to purchase the vehicle. Others quote a higher payoff for third-party buyers than they offer the lessee.
Call your leasing company and ask two separate questions: what’s the payoff if you buy it yourself, and what’s the payoff if a dealer or third party buys it. If the second number is much higher or isn’t available at all, a third-party sale is off the table. Your remaining options are to buy the car yourself and then resell it, or return it at lease end.
Financing the Buyout
You don’t have to pay cash. A lease buyout loan works like a standard auto loan: a bank or credit union pays off the leasing company, and you make monthly payments to the new lender. Rates track used-car loan rates, and as of early 2026, competitive offers from online lenders and credit unions start in the 4% to 5.5% APR range depending on credit.
Most lenders want a credit score in the low-to-mid 600s. A 620 to 630 is the floor at several credit unions, with the best rates reserved for scores above 700. Shop before accepting financing from your leasing company’s own finance arm. Credit unions in particular tend to come in lower, and a lease buyout is treated as a used-car purchase for lending purposes.
One wrinkle: the lender will appraise the vehicle. If the payoff exceeds what the lender thinks the car is worth, they may not finance the whole amount, leaving you to cover the gap in cash. Another reason to run the market-value comparison first.
Getting the Title
Once the leasing company receives payment and clears the balance, they release the lien. In states that use electronic lien and title systems, the lessor notifies the state motor vehicle agency electronically, which speeds things up considerably.4American Association of Motor Vehicle Administrators (AAMVA). Electronic Lien and Title In paper-title states, the lessor mails you a signed title with the lien release, and you take it to the DMV along with a bill of sale, proof of insurance, and an application for title transfer. Title transfer fees generally run from about $15 to $85 depending on the state. The full process typically takes a few weeks from the day the lessor receives payment.