Reaching the end of your equipment lease? You may have the option to purchase the equipment outright—but not all buyouts are created equal. Understanding your equipment lease buyout options can help you save money and avoid surprises.
Whether you want to own the equipment or move on, this guide breaks down what you need to know before making your next move.
What are the equipment lease buyout options?
Common buyout options include a $1 buyout, fair market value (FMV), and fixed-percentage buyouts. Each affects your long-term cost and ownership.
An equipment lease buyout is the option to purchase the leased equipment at the end—or sometimes during—the lease term. The cost and terms depend on your original lease agreement.
You pay just $1 at the end of the lease to own the equipment.
Best for: Businesses that plan to keep the equipment long-term
✅ Pros:
You own the equipment for virtually nothing
Predictable cost structure
May qualify for Section 179 tax deductions
❌ Cons:
Higher monthly payments
Less flexible than FMV leases
You pay the current market value of the equipment at lease-end.
Best for: Businesses that want lower monthly payments or plan to upgrade
✅ Pros:
Lower monthly lease payments
Option to return, buy, or upgrade
Useful for short-term or fast-evolving industries
❌ Cons:
Buyout cost is uncertain
Market value may be higher than expected
You pay a predefined percentage of the original equipment cost—often 10%—to own it.
Best for: Businesses wanting a balance between low payments and ownership
✅ Pros:
Predictable buyout cost
Lower monthly payments than $1 buyout
More affordable than FMV in many cases
❌ Cons:
Higher total cost than financing if equipment is used long-term
Some lease agreements allow you to buy out early—usually after a set number of payments. Ask about:
Early buyout penalties
Purchase price calculations
Remaining balance requirements
This is helpful if your business grows and you want to own equipment sooner than expected.
| Goal | Best Buyout Option |
|---|---|
| Want to own equipment long-term | $1 Buyout or Fixed % |
| Prefer low monthly payments | FMV Buyout |
| Uncertain about long-term need | FMV with return flexibility |
| Want predictable exit terms | Fixed % Buyout |
✅ What are my buyout options?
✅ When can I exercise the buyout?
✅ Is the cost fixed or market-based?
✅ Will I owe any additional fees at buyout?
✅ What happens if I don’t act before the lease ends?
An equipment lease isn’t just about monthly payments—it’s about what happens when the lease ends. Choosing the right buyout option ensures you’re not caught off guard and that your investment continues to serve your business well.
Before signing or renewing a lease, understand your buyout path. Whether you want to own, upgrade, or walk away, the right buyout option puts you in control of your equipment—and your business future.