Car lease calculator: estimate your exact monthly lease payment. Enter MSRP, down payment, residual value percent, money factor, and lease term in months.
Results are estimates for planning purposes and are not financial, medical, or professional advice.
How to Use the Car Lease Calculator
Leasing means paying for a car’s depreciation during your use plus a finance charge, instead of paying for the whole car. This calculator breaks your monthly lease payment into those two parts.
- Enter the vehicle MSRP and your down payment (capitalized cost reduction).
- Enter the residual value percent, which is the car’s projected worth at lease end.
- Enter the money factor, the lease equivalent of an interest rate, and the term in months.
- Review your estimated monthly payment and its depreciation and finance components.
Car Lease Payment Formula
Monthly payment = depreciation fee + finance fee. Depreciation fee = (Capitalized Cost – Residual Value) / Term. Finance fee = (Capitalized Cost + Residual Value) x Money Factor. Two details about how this tool works: the residual is a percentage of the MSRP you enter, and the capitalized cost is simply that MSRP minus your down payment. For a 35,000 dollar car with 3,000 dollars down, 60 percent residual, a 0.0025 money factor, and 36 months: capitalized cost is 32,000 dollars, residual is 21,000 dollars, depreciation is 11,000 / 36 = 305.56 dollars, finance is 53,000 x 0.0025 = 132.50 dollars, for a total of about 438.06 dollars per month. To convert a money factor to an approximate APR, multiply by 2400.
Example
Jordan leases a 35,000 dollar sedan with 3,000 dollars down. The 60 percent residual sets the end value at 21,000 dollars. With a 0.0025 money factor (about 6 percent APR) over 36 months, the monthly payment is about 438.06 dollars, split into 305.56 dollars of depreciation and 132.50 dollars of finance charge.
Lease Costs This Estimate Does Not Include
The monthly payment above is only part of the deal. Most leases add an acquisition fee of a few hundred dollars at signing, sales tax on each payment depending on your state, and a disposition fee of a few hundred dollars when you return the car. Excess mileage and damage charges can add more at lease end, so budget for the full picture, not just the payment.
Frequently Asked Questions
What is a money factor?
The money factor is the lease’s finance charge rate. Multiply it by 2400 to get the approximate APR. A 0.0025 money factor equals about 6 percent APR.
What is a good residual value?
Higher is better for lessees. Mainstream cars often carry 55 to 65 percent residuals on 36-month leases. Luxury cars may be lower, which raises payments.
Should I put money down on a lease?
A down payment lowers the monthly payment but is at risk: if the car is totaled, you generally do not get it back. Many experts suggest minimal drive-off costs on leases.
Lease vs buy: which costs less?
Leasing usually costs less per month but you build no equity. Buying costs more monthly but you own an asset. Compare total out-of-pocket over the same period, including the down payment.
What happens at lease end?
You can return the car, buy it for the residual value, or sometimes trade it in. Watch for excess mileage and wear charges when returning.
What does excess mileage cost?
Most leases charge 15 to 30 cents per extra mile. Driving 5,000 miles over your allowance at those rates costs 750 to 1,500 dollars, due when you return the vehicle.
Can I buy the car when the lease ends?
Usually yes. The purchase option price is typically the residual value from your contract plus any buyout fee, which lets you compare against the car’s market value before deciding.
Related Calculators
Compare with buying using the Auto Loan Calculator and check affordability with the Car Affordability Calculator.