The Expert Podcast

• Used car values are soaring, and this trend is expected to continue due to inventory shortages affecting both new and used cars.
• The rising prices are attributed to high demand, making it more expensive to replace leased vehicles, whether new or used.

• When your lease ends, if you don’t buy the vehicle, you’ll need to find another car. Given current market conditions, replacement cars may cost significantly more.
• Leasing companies typically offer a fixed buyout option (residual value) in your contract, which you can exercise to buy your vehicle for the agreed price, even if the market value has risen.

• By buying your vehicle, you avoid penalties for high mileage and damage that would otherwise apply if you return the car to the leasing company.
• Be cautious of dealers pushing you toward turning the car in rather than trading it in, as turning it in could mean losing equity in your vehicle.

• A trade-in allows you to keep the equity (difference between the buyout price and the current market value of your car).
• A turn-in means returning the car to the leasing company, which could result in additional charges for mileage and damage, and the dealership keeps any potential equity.

• If your car is worth more than the buyout, consider buying it and then selling it for a profit. Websites like CarMax, Carvana, or Vroom may offer to buy it.
• Be aware of sales tax when buying the car, as some states apply tax on used vehicle purchases.

• If returning the vehicle, ensure it's clean, remove personal items, and bring any service records.
• It's important to get a receipt when returning the car to the dealership to avoid surprises with excess charges later.

• Review your lease agreement to know what constitutes normal vs. excess wear and tear.
• If you want to return the car, it must be to a dealer in the same franchise. However, you can buy the car and then trade it in to another dealer.

• Many leasing companies won’t inform you about the equity in your car because they want to retain inventory. You may have thousands of dollars in equity that you could use to purchase your car at a lower price or even make a profit by selling it.
• Check your lease’s residual value and compare it with the current market value of your car to make the best decision.

• If your lease is ending, don’t let the dealership swallow your equity without a fight. Understand your options, and use your lease buyout to either purchase your car at a great price or sell it for a profit.