If you are considering buying a lease, confirm that such an option is possible. Once you've done that, consider how essential factors such as timing, vehicle cost, and financing will affect your price. These tips will help you drive the car you want and get the best deal:
Analyze lease terms
In some situations, the question may not be how to buy a rental car, but when to do it, as the timing of the purchase changes the price you will pay.
If you decide to purchase before the lease expires – known as an early buyout – you may have to pay additional commissions or finance charges. Check the lease terms carefully to determine how the leasing company handles an early buyout. If the costs are too high, wait until the end of the lease to buy.
Estimate the value of the car
Consider two types of car value when you plan to buy a lease.
Retail value: how much you must pay to buy a car from a dealer.
Wholesale cost: how much a dealer would pay to buy a car at auction.
For pricing details, check out sources like Kelley Blue Book, Cars.com, TrueCar, and Edmunds. Prepare all the information you need when conducting your research, including make, model, equipment, year of manufacture, and current mileage.
The leasing organization will likely offer to finance the purchase through them but will disagree until you've explored other financing options. Otherwise, you may be stuck paying interest due to dealer markups.
You'll likely be able to get a better interest rate from your financial institution than from a leasing company or dealership, says Nathan McAlpine, founder and CEO of automotive broker CarMate. There are no commissions or penalties if you choose not to go with a leasing company.
Additionally, to lend money for new and used cars, some lenders offer car leasing buyback loans that work like refinancing loans.
Let the leasing company make the first step
You may feel itchy to contact the leasing company to discuss a car lease buyout, but take the time to bleed your brakes. According to consumer advocates, taking the first step may reduce your chances of securing favorable terms.
Typically, the leasing company calls about 90 days before the lease expires. If you contact the organization before the countdown starts, you can specify how much you want to buy the car.
Try some discussion topics
Companies often have a no-negotiation rule regarding the purchase price of a lease buyout, leaving little room for bargaining to get a better deal.
In any case, it doesn't hurt to raise the issue. After all, you never know what kind of deal you can get unless you ask. There is nothing wrong with asking the seller to consider making a few concessions, including:
Waiver of the purchase option fee.
Experts point to the call option fee as a stumbling block many sellers are willing to take off the table.
In what situations is it profitable to buy a rented car?
Buying a lease is a good idea if you are willing to drive a car for a long time rather than entering a new lease. To determine if buying out a lease is the right thing to do, you have to ask yourself one crucial question: is it worth buying a car?
Understanding the residual value of a car is the first step to figuring it out. If your auto now has a higher value, it makes sense to purchase it. On the other hand, if the car's value has dropped during the lease, avoid buying back unless you can negotiate a lower price.
Another reason some drivers may choose to buy a rental car is to avoid additional fees charged at the time of rental. If you exceed your agreed mileage or have upholstery rips or dents, fines can mean that a buyout could save you money if you may turn around and sell the car at a profit.
The bottom line
Now that you know the main things about buying a rental car and saving money, please confirm your commitment. Be ready:
Get all the information you need on prices and values.
Take a look at credit.
If possible, discuss the price and terms.
If you have any doubts, you can consider buying a rental car a little later.