What a Carvana lease buyout actually is
You do not own the car. The leasing company does. So when you ask a retailer to buy your lease, you are not selling them a car. You are asking them to pay the leasing company's payoff and keep the car, then hand you whatever is left over from their offer. If the offer is below the payoff, you write the check instead.
That makes a Carvana lease buyout, or a CarMax lease buyout, a third-party buyout. Someone other than you is buying the car from the leasing company. The full mechanics of who may buy a leased car are in the third-party buyout guide. The short version is that the purchase option in your lease belongs to you, and the leasing company decides whether anyone else gets to use it.
Why the leasing company can say no
Your lease names a residual value. That was the leasing company's guess, years ago, at what the car would be worth today. When used-car prices run above that guess, the car is worth more than the residual, and the leasing company would rather have it back than let a retailer pocket the gap. The simplest way to keep the gap is to refuse payoff from anyone but you or a dealer in its own network.
Some leasing companies accept any third-party payoff. Some accept it only from a franchised dealer of their brand. Some accept it only from the lessee. Some have changed the rule more than once, and forum posts from a different month are not evidence of anything. Do not take the retailer's word, the dealer's word, or this page's word. Ask the leasing company for the current rule, in writing.
How to ask
- Call the number on your lease statement and ask for the lease-end or payoff department.
- Ask three questions: do you accept a third-party payoff, from whom, and is the third-party payoff amount different from my own payoff amount.
- Ask for the answer by email or in the payoff letter itself. A verbal yes is worth nothing when the funds arrive and the title does not.
The retailer will ask the same question. Its offer page wants to know who holds the lease because it already knows some leasing companies will not take its check. If the answer is no, the offer is a number on a screen and nothing more. It depends on the leasing company, every time.
What the retailer's offer really is
A retailer buys cars to resell them. Its offer is the price it needs to pay so that, after transport, reconditioning, its own costs and its margin, the car sells at retail with room to spare. That is a trade-in grade number. It is below what a private buyer pays for the same car, by design, because the retailer is the one doing the selling.
The offer is also produced at volume. An algorithm prices the car from your answers and a few photos, and the number expires in days. There is no one to negotiate with. You can accept it or not. That is the model, and it is a reasonable model for a retailer. It is just not built to get you the most money for your car.
The equity math, with made-up numbers
Say the residual is $18,000 and the purchase-option fee is $300, so your own payoff is $18,300. Say a retailer offers $20,000 and the leasing company allows the sale. You would get a check for $1,700. Say a private buyer would pay $22,000 for the same car. To get that money you first have to buy the car yourself, which means paying the $18,300 plus sales tax and title fees in your state. Pretend tax and title come to $1,350 in this example; yours will differ, so confirm the rate with your state's tax or motor vehicle agency. You would net about $2,350, and you would carry the car, the listing and the strangers until it sells.
Every number in that paragraph is invented. The structure is not. The retailer route is fast and costs you the gap between its offer and the private price. The private route costs you tax, title and effort, and only wins if the private price gap is bigger than those. Run your own numbers with the buyout calculation guide before you decide which gap is smaller.
| Route | What you get | What it costs you |
|---|---|---|
| Sell to a retailer | Offer minus payoff, if the leasing company allows it | The retailer's margin; an offer that expires in days |
| Buy it out, sell it privately | Private price minus payoff, tax and title | Tax, title, your time, and holding the car until it sells |
| Buy it out and keep it | The equity stays in a car you know | Tax, title, and a loan if you need one |
| Trade it in at a dealer | Whatever the dealer says the equity is | The dealer sets both numbers and you see neither |
| Return it | Nothing | Disposition fee, overages, and the equity goes to the leasing company |
The one-line rule. Never sign a retailer's offer on a leased car until the leasing company has told you, in writing, that it will accept that retailer's payoff.
The alternative that keeps the money yours
If the leasing company blocks the sale, the equity has not gone anywhere. It is still the gap between what the car is worth and what your payoff letter says. The way to collect it is to exercise the purchase option yourself, as the lessee, which is the one buyout the lease was written to allow. Then you own the car and can do what you want with it: keep it, sell it privately, or sell it to the same retailer that could not buy it from the leasing company a week earlier.
Whether keeping it is the right answer is a separate question, covered in should I buy out my lease. If you need a loan for the buyout, the list of what a real buyout partner does is the standard to hold anyone to. The dealer will offer to handle it. That is a different trap, and a more expensive one.
One more thing on the words "sell my lease." You cannot sell a lease to a retailer. You can only arrange for the retailer to buy the car. If the leasing company will not sell to them, the lease has nothing to sell, and the only buyer left who is certain to be allowed is you.
What to do this week
- Get your own payoff letter from the leasing company. Note the amount and the date it expires.
- Ask, in writing, whether a third-party payoff is accepted and from whom.
- Get the retailer's offer anyway. It is free and it tells you the floor.
- Price the car privately. The gap between that and the retailer's offer is what the convenience costs.
- If the leasing company says no to the retailer, buy it yourself. The equity was always yours to collect.
The short version
A retailer's offer on a leased car is a third-party buyout, and the leasing company can refuse it. Ask for the rule in writing before you plan around the number on the screen.
If the sale is allowed, the offer is a reseller's price and you pay for the convenience. If it is blocked, the equity is still yours. Buy the car out as the lessee, then keep it or sell it on your own terms.
Quick answers
Can I sell my leased car to Carvana?
Only if your leasing company accepts a third-party payoff from a retailer. Some do, some do not, and rules change. Ask the leasing company directly and get the answer in writing before you accept any offer.
Will CarMax buy my lease if the leasing company allows it?
A retailer can pay the leasing company's payoff and keep the car when the leasing company permits it. Its offer is a reseller's number, so compare it against a private-party price before you take it.
What if the leasing company blocks the sale?
Buy the car out yourself as the lessee. The purchase option in your lease is yours. Once the title is in your name, you can keep the car or sell it to anyone, including the retailer that could not buy it before.