When a lease ends you can return the car, buy it at the residual, extend for a short period, or use any equity toward the next one.
The options are simple and the timing is not, so ninety days before the end date is when to decide: that is when most captive lenders waive the disposition fee if you lease or buy another car of the same brand (Mercedes-Benz Financial Services, for example, waives its $595 fee within 90 days of return, as published by its dealers in 2026).
| Option | What you pay | When it fits |
|---|---|---|
| Return | Disposition fee (usually waived when you take another car of the same brand), excess miles at the contract rate, excess wear | The car is worth less than the residual, or you simply want the next car |
| Buy | The residual (purchase option price) plus tax, title, and any purchase fee | The car is worth more than the residual, or you love it and the miles are high |
| Extend | Monthly payments continue for the extension | The next car is on order or you need a few months |
| Trade the equity | Nothing; the difference between market value and residual reduces the next deal | The car is worth more than the residual and you want the next one |
Get the payoff from the lender (the residual plus any remaining payments and fees). Get a value: The Model Black's trade-in tool gives a range from market comps by VIN, and a dealership's appraisal on your deal gives you its own number, good through the date it states if the car arrives as described. If that number is above the payoff, that is equity you can apply to the next car or take as cash from that dealer. If it is below, return the car and let the lender absorb the difference.
Yes, at the purchase option price in your contract (the residual) plus tax and fees. Lenders increasingly require the buyout to go through their own brand's dealers; confirm with the dealer.
Most captive lenders waive it when you lease or buy another car of the same brand within a window around return; Mercedes-Benz Financial Services, for example, waives its fee within 90 days, as published by its dealers in 2026. Otherwise it is $595.
Damage beyond the lender's normal-wear standard: dents over a set size, tires below a tread depth, cracked glass, interior damage. The lender's inspection guide lists the thresholds.
Many lenders allow a short extension on request; terms vary. Ask the dealer 60 to 90 days out.