Enter the residual value ($) and the total remaining payments/costs amount ($) into the Calculator. The calculator will estimate the total amount you would pay from today until you own the asset (remaining payments + residual). For an official payoff/buyout quote (which can include taxes and fees), refer to your lease contract or contact the lessor.

Lease Buyout Cost Calculator (Simplified)

Estimates total cost from today as: remaining payments/costs + residual value. Early buyout/payoff amounts can differ from this simplified estimate.

Basic
Remaining Payments Estimator
Residual Helper

Enter any 2 values to calculate the missing variable. If you are already at lease end, your remaining payments are typically $0.

Estimated Lease Buyout Cost Formula (Simplified)

BP = RV + RP

Variables:

  • BP is the estimated total amount paid from today until you own the asset ($)
  • RV is the residual value / base purchase option price from the lease contract ($)
  • RP is the total remaining payments/costs you plan to include ($)

To estimate the total cost to own using this simplified model, add the residual value to the total of your remaining payments (and any payment taxes/fees you choose to include). Note: an official early buyout/payoff amount and end-of-lease purchase total can include additional taxes, registration/title costs, and fees, so confirm your exact numbers with your lease contract or lessor.

How to Estimate Lease Buyout Cost?

The following steps outline how to estimate the total lease buyout cost using the simplified formula above.

  1. First, determine the residual value ($) from your lease contract (this is typically set at the start of the lease). 
  2. Next, determine the total remaining payments/costs amount ($). If you are already at lease end, this is typically $0. 
  3. Next, gather the formula from above: BP = RV + RP.
  4. Finally, calculate the estimated total cost to own.
  5. After inserting the variables and calculating the result, check your answer with the calculator above.

Example Problem : 

Use the following variables as an example problem to test your knowledge.

residual value ($) = 10000

total remaining payments amount ($) = 3000

FAQs

What is Residual Value?

Residual Value is the estimated value of an asset at the end of its lease term or useful life. In the context of leasing, it is typically set in the contract at the start of the lease and represents the base purchase option price (before taxes and fees) at lease end.

How does the Buyout Price differ from the Salvage Value?

In a lease, the buyout (purchase option) price at the end of the lease is typically based on the contractual residual value (often plus a purchase option fee and applicable taxes/registration). Salvage Value, on the other hand, is the estimated value of an asset at the end of its useful life—often what it could be sold for as parts or scrap.

Why is calculating the Buyout Price important?

Calculating the buyout cost is important for lessees to understand how much they may need to pay to purchase the leased asset and to compare that total cost to alternatives (returning the asset, purchasing a different vehicle, or refinancing).

Can the Buyout Price change over the course of a lease?

The contractual residual value in most standard closed-end leases is set in the lease agreement and generally does not change due to market conditions, wear, or mileage. However, an early buyout/payoff quote can change over time as the remaining balance declines, and you may owe separate taxes, registration/title costs, excess wear/mileage charges, disposition fees, or other contract-specific fees.