The term, car lease option, usually refers to the concept of financing a car with a lease, then buying the car at lease-end. Most lease contract provide this option.

The lease-end purchase price is set at the beginning of the lease (for standard consumer closed-end leases). This value is usually the same as the lease-end residual value. Some lease companies may add a purchase option fee which would be added to the residual value.

If the purchase option is not exercised at lease-end, the car must be returned to its lease company. In this case, the lessee may be billed for excessive mileage or wear-and-tear, as well as a possible disposition fee (specified in lease contract).

Lease purchase option prices are sometimes negotiable. However, some lease companies have a policy of not negotiating.

Also be aware that buying your leased car from the lease company is the same as buying any other used car. You must pay sales tax (in most states) and have the title registered in your name.

For more information, see: The Lease Guide

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