If you've grown attached to the Kia vehicle you're leasing, returning it at the end of your lease term may not be the most appealing option. Fortunately, you can purchase the car you love through the Kia lease buyout program.
A lease buyout allows you to own your leased Kia and continue driving it without any mileage restrictions. However, buying out your lease can be tricky, especially if your vehicle has sustained excessive wear and tear or damage during your lease.
Fully understanding the Kia lease buyout process can help ensure a smooth transaction and avoid any unnecessary hassle. In this article, we tell you how a lease buyout works, whether it's worth it, and what fees you can expect to pay.
Looking to buy out your leased Kia? Compare auto loans below to find the best deal.
Kia Lease Buyout Process
Buying out your Kia lease simply means purchasing your leased Kia vehicle instead of returning it to the dealership. In most cases, a lease buyout occurs at the end of a car lease. This is the most straightforward type of buyout, as the lease agreement spells out the terms. Alternatively, you can purchase the car before your lease ends, but you must prepare to face extra challenges.
Once you're ready to buy out your leased Kia vehicle, take the following steps to complete the process:
Get a buyout quote from Kia: You can get a buyout quote from Kia by calling a Kia Lease-End Advisor, logging into your Kia Finance America account, or contacting a Kia dealership.
Check your lease agreement: Before you make a payment, it's a good idea to check your lease agreement for the residual value of your Kia. Knowing this figure can help you make a better-informed decision when weighing your options.
Obtain financing: Unless you have enough cash to purchase your leased vehicle outright, you'll have to secure auto financing to fund the buyout. Kia offers direct financing to drivers who want to buy their leased vehicles, but you'll want to compare offers from several lenders to ensure you get the best deal. While dealership financing can help you save time and hassle, banks and credit unions usually offer lower interest rates.
Negotiate the lease buyout: Even if your lease contract includes the buyout amount, you may still be able to negotiate a lower purchase price. Getting pre-approved for a loan can put you in a stronger position to negotiate payment terms.
Register and insure your Kia: Once you're the official owner of your Kia, you'll have to register and title it at your state's Department of Motor Vehicles. Since car leasing doesn't include auto insurance coverage, you must also get your vehicle insured.
Is a Lease Buyout Worth It?
Purchasing your leased Kia can be a great option if you've grown fond of the vehicle and kept it in good condition. However, you should run the numbers to confirm that a buyout is worth it.
You can get a lease buyout quote from Kia online or over the phone, but you can also easily calculate the amount yourself. All you need to do is compare the residual value in your lease contract with the actual value of your leased vehicle, which you can determine using online car valuation tools.
If the residual value of your Kia is lower than its actual value, it means the vehicle is worth more than its original estimated value. In this case, buying out your lease is a great financial move.
In contrast, if your Kia's residual value is significantly higher than its actual value, you'll actually lose money if you opt for a buyout. This usually happens if you've racked up a lot of mileage or been through multiple accidents or repairs.
Even if it makes financial sense, the buying out your lease may or may not be right for you, depending on your situation. Below are a few circumstances in which you'll want to think extra carefully about purchasing your leased Kia:
Your vehicle has been involved in several accidents and has undergone substantial repairs, resulting in significant depreciation.
You're more interested in a newer model year or another model.
You have a low credit score that's preventing you from securing a low-interest car loan.
In these situations, it's probably best to return your leased Kia and start a new lease or buy another vehicle. You can also extend your lease to give yourself more time to improve your credit score, which can help you negotiate a better buyout loan in the future.
Can You Negotiate a Kia Lease Buyout?
It's possible to negotiate a lease buyout. However, whether you succeed in lowering the price of the vehicle depends on your approach. Follow these steps to get a good deal on your Kia buyout:
Do Your Research
Your Kia lease contract includes an estimate of how much your vehicle will be worth at the end of the lease term. Research the current market value of your car and compare it with this estimated value. If the market price is much lower than the estimate, you stand a good chance of successfully negotiating a better purchase price. However, if the price reduction isn't enough to buy the car at the market value or below, consider passing on the purchase.
Contact Your Financier Beforehand
Your Kia dealership may not be the only party determining the buyout amount for your lease. If you didn't secure financing through the dealer, it's worth contacting your leasing company. For example, if your lender is a bank or credit union, negotiate directly instead of through your dealer.
Make an Offer
After you've done your research, you can go to the dealership to make a lease buyout offer. If you show that the estimated value in the agreement is inaccurate, the dealer will likely offer you a lower buyout price.
Kia Buyout Fees and Rates
To buy out your Kia lease, you'll only need to pay the residual value of your vehicle and a buyout fee. Also known as a purchase option fee, this fee usually amounts to a few hundred dollars. If you can't negotiate the residual value, ask your dealership to reduce or remove the purchase option fee.
If you decide to purchase the vehicle before your lease ends, you must settle any remaining payments and pay an early buyout charge. Since your dealer would rather you buy the car after fulfilling your lease term, it typically won't negotiate on this fee.
Buying your leased Kia vehicle means you won't be subject to excess wear and tear and mileage charges. This makes the lease-end process simpler and could save you money.
A Kia lease buyout is worth considering if you adore your leased Kia and can buy it for a good price. By investing some time and effort into understanding the buyout process, you can move into car ownership with minimal hassle.
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