End of Car Lease: Return, Buyout, or Re-Lease?
About 90 days before your lease end date, your captive will send a notice outlining your options. You have three choices, and the right one depends on the car’s current market value versus its contract residual, your credit situation, and whether you want the same car or a fresh start.
Option 1: Return the car
The standard path. Schedule a pre-inspection 30 to 60 days before lease-end (most captives offer a free third-party inspection through SGS Automotive or similar). The inspector assesses excess wear, mileage overage, and missing equipment. You receive a written estimate. Use it to decide: pay the charge, fix the damage before turn-in, or dispute.
Costs at turn-in: Disposition fee ($350 to $595 depending on captive), any mileage overage at the contracted per-mile rate, and excess wear charges per the captive’s schedule. The disposition fee is typically waived if you lease a new vehicle with the same captive or buy out.
2026 market context: Used-car values have normalised significantly from the 2021 to 2023 peak. Most mainstream vehicle residuals are now roughly at or within 5% of current market value. The wild-arbitrage lease buyouts of 2022 (market value $10,000 above residual) are uncommon in 2026, but desirable trucks and full-size SUVs still hold value above residual in many cases.
Option 2: Buy out the lease
You pay the contract residual (a fixed number set at lease signing) plus a purchase option fee ($150 to $500) plus state sales tax on the residual. Total buyout cost = residual + option fee + tax. Compare this to the car’s current market value from KBB, Edmunds, or CarGurus for a vehicle matching your year, trim, mileage, and condition.
When to buy out: Market value exceeds total buyout cost (you are buying below market). You love the car and it has been trouble-free. You have significant mileage overage that the buyout eliminates (you pay no overage on a buyout). Your wear charges would be large (buyout skips the inspection).
When not to buy out: Market value is below the residual (common for EVs in 2026 due to price-war depreciation). You can get a better-equipped or newer vehicle at a comparable payment. Full lease buyout math →
Option 3: Re-lease the same car
Available at some captives in certain markets (Honda, Toyota, and BMW have offered it). You enter a new lease on the same vehicle, with a new residual based on its current market value and depreciation projection. The captive may waive the disposition fee and pre-inspection.
When it makes sense: You genuinely want the specific car for another 2 to 3 years, it has been trouble-free, and you do not want the hassle of shopping. Disadvantage: Monthly payment usually rises because the older car has a lower residual baseline and you may not have access to the same subvented money factor as new-car deals.
Re-leasing the same car is rare. Most people who want to continue driving the car simply buy it out.
The inspection process
Third-party pre-inspection (SGS Automotive, AiM) is available through most captives’ return portals. Schedule 30 to 60 days before lease-end. The inspector comes to your location or you drop off at a designated centre. You receive a written estimate of any charges.
- Tyres: Check tread with a quarter coin (tread below 4/32” = excess). Replace if borderline.
- Panels: Credit-card test on dents. Smaller than a credit card = normal. Touch up chips before inspection if possible.
- Windshield: Chips are usually acceptable. Cracks spanning more than 6 inches typically require replacement ($400 to $1,200 captive charge vs $150 to $350 at Safelite).
- Interior: Clean thoroughly. Large stains are charged ($200 to $600 for seat replacement).
- Missing equipment: Locate the second key fob, floor mats, cargo cover, owner’s manual, and first-aid kit (European brands require this).
Negotiating at lease-end
Buyout price is contractual and non-negotiable. But fees sometimes are. The purchase option fee ($150 to $500) occasionally flexes at the captive’s discretion. Disposition fees are often waived for loyalty customers. Post-inspection charges for borderline items (single small ding, minor scuff) can be disputed with photo evidence within 30 days of the invoice. Request an itemised charge list immediately at turn-in.
If you plan to lease a new vehicle with the same brand, mention it at return. Many captives will waive the disposition fee and may negotiate inspection charges as a loyalty gesture. Get any waiver confirmed in writing before or at turn-in.