Can I sell my leased car? Yes, but almost never in one step: the leasing company holds the title, so the payoff comes first and the sale second. So the route is buyout, then sale, and it only pays when a buyer offers more than the payoff.
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The title isn't yours. Nebraska's DMV, for one, issues a leased car's title with the leasing company as the titled owner and mails it to the leasing company; the driver gets a copy marked "Registration Copy." Any buyer wants a title signed by the owner, and here that owner is a finance company.
That is why the buyout comes before the sale. Our buying partner's help pages say all liens and loans must be paid in full before it buys, and a car titled to a leasing company is not yours to sign over until the lease is paid off. (It also buys only cars, trucks, vans and SUVs, never motorcycles, RVs or boats.) Driveway's FAQ, by contrast, offers to work with you on a buyout but warns that "some leasing companies and lease agreements don't allow an early buyout." Whoever the buyer is, the leasing company's rules decide.
What you do own is a right to buy. The CFPB puts it bluntly: leasing is like renting, and your payments "won't go towards owning the car, unless there's an option to purchase it." Federal Regulation M requires the lease to state whether you have that option, the price at the end of the term and, for an earlier purchase, the price or how it is worked out and when you may use it. Find that clause first. Without it, the FTC's rule applies: at the end of a lease you have to return the car unless the agreement lets you buy it.
Two figures settle it. The first is what a buyer will pay for the car once it is titled to you. The second is the payoff the leasing company will accept. Offer minus payoff is your equity. If the payoff is the bigger number, you have negative equity, and selling means paying to leave a car you could hand back.
Don't confuse the payoff with the residual. Regulation M defines the residual as the car's end-of-lease value "as estimated or assigned at consummation by the lessor," a guess made the day you signed. The payoff is that residual plus what is still owed on the contract, plus any fees, and it moves month to month. A car that held its value better than the guess carries equity; one that didn't, doesn't. How fast a car loses value shows how wide that swing runs.
An example, with invented numbers:
For the first number, a free online offer shows what the car fetches as it sits; the buyer just can't close until the title is in your name. Price a private sale too: a private buyer often pays more than any instant offer on a late-model car, and trade-in versus selling privately shows the gap. For the second, ask the leasing company for the payoff in writing, with the date it is good through and whether anyone but you may pay it.
Several carmakers' finance companies accept a payoff only from you or from one of their own brand's dealers. That rule decides whether an outside dealer or online buyer can take the car. Here is what four lenders' own pages said when we read them on October 24, 2026:
| Leasing company | What its own page says |
|---|---|
| GM Financial | "We do not currently process lease purchase requests through non-GM dealerships." You yourself "can purchase your vehicle at any point during your lease." |
| BMW Financial Services | The payoff shown in your account "is intended for you, and will not be honored if sent in by a third-party dealership." |
| Toyota Financial Services | Handing the car to a third-party dealership is "an unauthorized third-party vehicle return," and you stay responsible for the whole lease until TFS receives the payoff funds and paperwork, or the car reaches a Toyota or Lexus dealer. |
| Ford Credit | The purchase price is in your Red Carpet Lease agreement or comes from your originating dealer; "if you are unable to return to your originating Ford dealership, you may work with any other Ford dealership." Its page names no route through other brands' dealers. |
Policies change and your contract controls, so ask your lender two questions: will you accept a payoff from this buyer, and what payoff will you quote them? If the answer is "only our own dealers," you can still collect offers from several dealers of that brand, or buy the car out and sell it to anyone.
When the lender allows it, this is the lighter route. The dealer pays the leasing company its quoted payoff and hands you the difference, much like selling a car with a loan on it with the leasing company in the lender's seat. Settle four things first:
Start weeks before the lease ends; the payment and paperwork have to reach the leasing company in time.
If the lender won't take your buyer's money, buy the car, title it in your name, and sell to whoever pays most. The cost of this route is tax on the buyout, and that depends on your state. Toyota's lease-end guide adds one wrinkle: "Some states require that you purchase your lease vehicle through your dealer." Nine states' rules, each from the agency's own page:
| State | Tax on your buyout |
|---|---|
| Texas | Taxed as a new sale "since a new taxable sale (second transaction) has occurred," at 6.25 percent, and you "cannot claim a credit for tax paid in the lessor's name." A dealer holding the car strictly for resale titles it tax free, so a direct dealer payoff spares you that bill. |
| California | Presumed a nontaxable sale for resale if you transfer title and registration to a third party within 10 days of taking title from the lessor; the presumption falls if you used the car first. A 1994 tax-counsel letter applied it to a midterm buyout resold before the car was used. |
| Virginia | Exempt from the sales and use tax if you paid it when you leased, the lease is in your own name rather than a business, and you buy from the lessor or the selling dealer at the end of the lease (Va. Code 58.1-2403). |
| New York | "The charge to purchase the vehicle at the end of the lease term" is taxed when you pay it, and the finance company collects and remits it. |
| Ohio | "Each transfer during or after the lease term is a separate sale, with tax due at each title transfer," paid to the clerk of courts at your county's rate; a partial credit may apply on an early buyout. |
| Illinois | A retail sale the leasing company reports on Form ST-556. For a car first leased on or after January 1, 2015, it gets no credit for the tax already paid if that lease was taxed on the amount due under the contract. |
| Michigan | "6% of the full purchase price," collected by the leasing company; an early-termination penalty rolled into the price is taxed too. |
| New Jersey | 6.625 percent on the purchase price. If the state later questions the sale, it asks for the lease purchase agreement showing the buyout figure and the tax you paid. |
| Florida | A sale to the lessee at the conclusion of a lease is a "sale," and the purchaser must pay sales tax; the state's motor vehicle tax guide adds any county surtax and lists no exemption for lease buyouts. |
Everywhere else, ask the leasing company what tax it will collect and look up your state on our sell my car by state pages, which also carry each state's title fee. Then, if you sell for more than you paid, the IRS treats the profit as a capital gain, while a loss on a personal car "isn't tax deductible." Taxes when selling a car covers the reporting.
If every offer sits below the payoff, hand the car back and pay the end-of-lease charges instead. The FTC says you're responsible for "excess wear and damage and any missing equipment"; the CFPB notes most leases cap mileage at 10,000 to 15,000 miles a year with fees for going over. Toyota Financial's guide says its final invoice arrives 60 to 120 days after the return, and recommends a courtesy pre-inspection in the 60 days before it, with a condition report "itemizing any estimated excess wear and use fees."
A damaged or broken leased car can flip the answer. If the wear bill would be large and the warranty won't cover the fix, buying the car out and selling it as it is may cost less than returning it; get the inspection report and an as-is offer and compare. Once the title is yours, condition is no barrier: our partner makes offers on cars that don't run and sends a truck for them, and selling a car with problems covers what to disclose.
Ending early is its own cost. Regulation M makes consumer car leases carry this warning: "You may have to pay a substantial charge if you end this lease early. The charge may be up to several thousand dollars." Read that clause and the purchase-option clause together before you talk to any buyer.
Servicemembers have a separate exit. The Servicemembers Civil Relief Act (50 U.S.C. 3955) lets you end a car lease without early-termination charges if you signed before active duty and were then called up for 180 days or more; or signed during active duty and then received deployment orders of 180 days or more, or PCS orders out of the continental U.S., or from a state outside it to anywhere outside that state (the act counts territories as states). Per the CFPB's summary, deliver written notice with a copy of your orders, then return the car within 15 days of that notice. Taxes, fees and reasonable wear charges can still be billed, and returning the car forfeits any equity.
What each national buyer publishes about buying a car that is still on a lease.
| Buyer | Takes it? | Their rule |
|---|---|---|
| AutoNation | yes | For a leased car: It does lease buyouts with approved leasing companies. Their page |
| Autotrader | no | For a leased car: PSX won't sell a leased car until you buy it out; Autotrader points lessees to the KBB Instant Cash Offer instead. Their page |
| Carfax | not stated | For a leased car: Sell My Car pages don't say; Carfax's trade-in guide says a lease balance must be paid off before a dealership takes the car. Their page |
| CarGurus | depends on the dealer | For a leased car: CarGurus’ guide says a leased car can be sold and points to Sell My Car for offers from local dealers; whether a dealer bids is up to the dealer. Their page |
| CarMax | case-by-case | For a leased car: Yes, except cars leased through any of 21 finance companies it names. Their page |
| Carvana | case-by-case | For a leased car: Carvana pays off a lease only with 12 approved leasing companies and only with more than 30 days left; with any other company you buy the car out and title it in your name first. Their page |
| Driveway | yes | For a leased car: Where the leasing company allows an early buyout; it also buys leased cars without a trade. Their page |
| Edmunds | case-by-case | For a leased car: CarMax buys leased cars in most cases, much as it buys a financed car, but it cannot buy from certain leasing companies. Their page |
| Kelley Blue Book | yes | For a leased car: Through the Instant Cash Offer the participating dealer processes the lease payoff; ask your leasing company what paperwork it needs. Their page |
| TrueCar | yes | For a leased car: Yes after a buyout: its steps have you buy the car from the leasing company and get a title in your name first. Their page |
A buyout puts the title in your name, and from there the sale follows your state's ordinary rules. Each state page lists who signs where, what happens to the plates, and any notice you file after the car leaves.
Not until the lease is paid off: ours says every lien and loan must be paid in full first, and the leasing company holds the title until the buyout. Driveway says it will try, with the caveat that some leasing companies don't allow an early buyout. Either way the order is payoff first, title in your name, then the sale.
Not always. BMW Financial Services says the payoff in your account will not be honored if a third-party dealership sends it in, and GM Financial doesn't process lease purchases through non-GM dealerships at all. Ask the leasing company for the exact figure your buyer would pay, in writing, with its expiry date.
It depends on the state. Texas taxes the buyout at 6.25 percent with no credit for the leasing company's tax. California presumes a nontaxable resale if you transfer title to a buyer within 10 days without using the car. Virginia exempts a lessee who paid the tax at lease signing and buys at lease end in their own name. The other states we checked tax it as a purchase.
Check your lease and ask the leasing company. GM Financial tells customers they should not be charged a fee by the dealer to facilitate a payoff, whatever the fee is called. If a dealer wants one to let you buy your own car, ask the lender in writing whether it is required.