Your lease is nearing its end, and the dealer has started calling. At lease maturity you really have three choices: walk away and hand the keys back, sign a brand-new lease on another car, or buy out the vehicle you have been driving. The right decision is rarely the one the salesperson pushes first. This Smekys lease renewal calculator lays the two most common paths — leasing a new car versus buying out your current lease — side by side, so you can see the true total cost of each instead of reacting to a single monthly number.
Many drivers default to renewing because it feels familiar: same dealer, same routine, a shiny new warranty. But a renewal rolls a fresh down payment, a new first-payment dip, and possibly a new disposition fee into your budget, while a buyout lets you keep a car you already know and stop making payments after a short finance period. Only the math tells you which path is actually cheaper over the next few years.
How to Use
- Enter your Current Monthly Lease Payment — the amount you have been paying each month. This becomes the baseline for your monthly-payment change.
- Type the dealer's New Lease Monthly Payment — the quoted payment on the replacement vehicle they want you to drive next.
- Add the New Lease Down Payment (also called a cap cost reduction). This is cash due at signing, on top of the first month's payment.
- Pick the New Lease Term — 24, 36, 39, or 48 months. A longer term lowers the monthly payment but raises the total dollars you spend.
- Enter the Lease Buyout Price — the fixed purchase-option price printed on your lease contract, usually the projected residual value plus a small buyout fee.
- Fill in the Disposition Fee (typically $300–$500). This is the return fee the leasing company charges if you simply walk away; most captive lenders waive it when you renew with the same brand or buy out the car.
- Add any Sales Tax on Buyout your state charges on a purchase-option deal. Leave it at 0 if your state does not tax the buyout separately.
The result card then computes the total cost of the new lease (down payment plus every monthly payment over the term), the total cost of buying out your car, the dollar gap between them, your monthly payment change, and a plain recommendation.
The Two Cost Paths
Lease renewal and lease buyout are settled with two very simple formulas:
- New lease total cost = new down payment + (new monthly payment × number of months).
- Buyout total cost = buyout price + buyout price × sales tax rate ÷ 100.
Take the worked numbers used on this page: an old payment of $491, a quoted new payment of $475, a $2,000 down payment, a 36-month term, and a $19,600 buyout price. The renewal path costs $2,000 + $475 × 36 = $19,100 over three years. The buyout path costs $19,600. Renewing is $500 cheaper, and your monthly payment actually drops by $16 — so on paper, renew wins.
Notice what the monthly number alone hides. If you only compared $475 to your old $491, you would think you are saving money every month, but you would miss the $2,000 due at signing. Conversely, a buyout looks like a huge $19,600 check at first, but once the car is paid for you have no further monthly payments at all — whereas the renewal leaves you starting the lease clock over again.
Why the Disposition Fee Matters
Nearly every closed-end lease charges a disposition fee of $300–$500 when you return the car at the end. The trick is who actually pays it:
- Walk away — you return the car and lease nothing from that brand: you pay the full disposition fee.
- Renew / lease again with the same captive lender — the manufacturer usually waives the disposition fee as a customer-loyalty incentive.
- Buy out the car — you are purchasing the vehicle rather than returning it, so no disposition fee applies.
That is why this calculator keeps the disposition fee as a separate "walk-away" line rather than baking it into either head-to-head total. If your dealer refuses to waive it on renewal, add it back to the new-lease total and the gap narrows.
Examples
Example 1 — The default renewal. A driver paying $491/month is offered a new lease at $475/month with $2,000 down for 36 months, while their buyout price is $19,600. Renewal totals $19,100; buyout totals $19,600. The calculator recommends Renew and shows a $16/month decrease — a comfortable, cheaper path.
Example 2 — When the buyout wins. Suppose the same car's buyout is only $14,000, while the new-lease quote is $500/month with $2,500 down over 36 months. The renewal costs $20,500 but the buyout costs just $14,000. Buying out saves $6,500 outright, and once financed, the driver owns the car free and clear. The calculator flips the recommendation to Buyout.
Example 3 — The high-residual caution. On a luxury lease, the buyout price can approach $1,000,000 (for a fleet or very high-value vehicle). Renewing at $2,000/month with $10,000 down over 36 months costs $82,000 — dramatically less than buying out. The engine handles these large magnitudes cleanly so you can stress-test expensive fleets without arithmetic errors.
FAQ
Is it better to renew my lease or buy out the car?
It depends on the total dollars, not the monthly payment. Renewing is cheaper when newDownPayment + newMonthlyPayment × term is less than your buyout price; buying out wins when the residual is low relative to a fresh lease. Run both figures here before deciding.
What happens if I just return the car?
You will owe the disposition fee (typically $300–$500), plus any excess mileage or wear-and-tear charges on your contract. You walk away with no car and no equity — simplest, but it gives up the option to buy a vehicle you already know.
Do I pay the disposition fee if I renew?
Usually no. Most captive leasing companies (Toyota Financial, GM Financial, Ford Motor Credit, etc.) waive the disposition fee for customers who lease or finance another vehicle through them. Confirm it in writing with your dealer; if they refuse, add the fee to the renewal total.
Does buying out my lease require a credit check?
Often, yes. A purchase-option buyout is typically financed through a lease-buyout loan or your bank, which checks credit. If you can pay cash, no credit check is needed. Compare buyout loan rates against the new-lease interest (the "rent charge") before committing.
Can I negotiate the buyout price?
The buyout price on your contract is the agreed residual, but the final buyout cost — including the purchase-option fee and tax — is sometimes negotiable, especially if the car has high mileage or damage. Check current market values on Edmunds or Kelley Blue Book to see whether the buyout is above or below market.
What if I want a shorter lease term?
A 24-month lease raises your monthly payment but lowers the total dollars spent and gets you back to the decision sooner. Use the term selector to compare 24, 36, and 48 months — longer terms feel cheaper monthly but almost always cost more overall.
Is sales tax on a lease buyout the same as on a new car?
It varies by state. Some states tax the full buyout price, others tax only the difference between the buyout and the residual, and a few waive it. Enter your local rate or ask your dealer; the calculator adds it to the buyout total so you are not surprised at signing.
Related Calculators
- Lease Buyout Calculator — estimate the total cost to purchase your current leased car at the end of term.
- Lease vs Buy Calculator — compare leasing versus financing a car over the full ownership horizon.
- Lease Payment Calculator — work out the monthly payment from residual, money factor and cap cost.
- Auto Loan Calculator — estimate the monthly payment and total interest if you finance the buyout.
Disclaimer
This lease renewal calculator is provided by Smekys for informational purposes only and does not constitute financial, leasing, tax, or legal advice. Totals are based on the exact figures you enter and the simple formulas above; actual lease-end offers, disposition-fee waivers, buyout pricing, and state sales tax treatment vary by lender, dealer, credit profile, and location. Always confirm your final numbers and terms directly with your leasing company and dealer before renewing, buying out, or returning a vehicle.