How to Lower the Lease Buyout Amount. Lowering the lease buyout amount on your car can save you money. You may be happy with the car that you've been leasing and know that it's mechanically sound, so you would like to buy it when given the option. However, negotiating with the dealership or leasing company when your lease expires takes skill and...
Lowering the lease buyout amount on your car can save you money. You may be happy with the car that you've been leasing and know that it's mechanically sound, so you would like to buy it when given the option. However, negotiating with the dealership or leasing company when your lease expires takes skill and knowledge. Before you approach the subject of buying the vehicle that you've been driving, you need to understand the terms of your lease and know valuable details about your car.
Read your lease carefully to understand the terms of your buyout. Look for the residual value, which is how much your car is estimated to be worth at the end of the lease, and any fees associated with the purchase. If you return the vehicle and don't buy it, you may owe the leasing company money if the residual value is higher than the market value.
Check your odometer to determine if you have exceeded the mileage limit specified in your lease. Driving more miles than allowed on the lease increases the buyout amount. If you are in this situation, do not divulge your mileage during negotiations with the leasing company, because it can compromise your position to negotiate.
Check your car's current market value on a reputable website that allows you to enter the make, model, year, options and mileage. You will use the value to compare it to the buyout amount once you receive it.
Wait to contact your leasing company. You can call them for the buyout amount a few months before your lease expires, but knowing that you are eager to buy your car risks your posture during negotiations. If you are patient, the company may give you a buyout offer close to the date of expiration.
Research loans from various lenders once you know the buyout amount. You can save money by financing your buyout with a company other than the dealership or current lease holder. In addition, use the information as a bargaining tool when negotiating the terms of your buyout. However, many lease buyout loans carry higher interest rates than a standard car loan.
Offer or counteroffer the lease holder an amount less -- as much as 25 percent -- than the residual value of the car, depending on whether you contact the company first or the other way around. If you return the vehicle, the car dealer will not be able to sell it on the lot for a high residual value or, possibly, even market value, because it was leased. Therefore, it saves the dealership time and money if you buy out the lease.
Counteroffer at 15 to 20 percent less than the residual value if the leasing company does not accept your first offer, and it is less than a month from the expiration of your lease. Explain that, once the car is returned, the lease holder may not be able to earn as much as you are offering if it is sold at wholesale or auction.
Decide if it's cheaper to buy the car for the leasing company's final offer just before your lease expires or to purchase another similar vehicle. Ideally, you will not have to pay full residual value after negotiating the buyout amount.
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