Auto Lease Calculator

Calculate monthly lease payments and compare leasing vs. buying options

Car leasing allows you to drive a new vehicle for a lower monthly payment compared to buying. This calculator helps you understand lease payments, total costs, and whether leasing or buying is the better financial choice for your situation.

Vehicle Information

Vehicle MSRP ($)

Negotiated Price ($)

5.7% discount from MSRP

Residual Value (% of MSRP)

Residual value: $19,250

Lease Terms

Lease Term (Months)

Money Factor (Interest Rate)

Money Factor: 0.00125 = 3.00% APR

Annual Mileage Allowance

Excess Mileage Fee (per mile)

Upfront Costs

Down Payment ($)

Trade-in Value ($)

Acquisition Fee ($)

Security Deposit ($)

Sales Tax Rate (%)

Quick Presets

Lease Calculation Results

Enter vehicle and lease details to calculate payments

How Auto Leasing Works

Lease Payment Components

Depreciation: The difference between the vehicle's negotiated price and its residual value, divided by the lease term.

Finance Charge: Interest on the lease, calculated using the money factor (similar to an interest rate).

Taxes and Fees: Sales tax on monthly payments plus various fees like acquisition and disposition fees.

Formula: Monthly Payment = Depreciation + Finance Charge + Taxes

Key Lease Terms

Residual Value: The vehicle's estimated value at lease end, expressed as a percentage of MSRP.

Money Factor: The lease interest rate, typically expressed as a decimal (multiply by 2400 for APR equivalent).

Capitalized Cost: The negotiated price of the vehicle, minus any down payment or trade-in.

Mileage Allowance: Annual mileage limit; exceeding it results in excess mileage charges.

Leasing vs. Buying Considerations

Advantages of Leasing

• Lower monthly payments compared to buying
• Drive newer vehicles with latest technology
• Warranty coverage throughout lease term
• No depreciation risk or resale hassles
• Potential tax benefits for business use
• Option to purchase at lease end

Advantages of Buying

• Build equity and eventual ownership
• No mileage restrictions
• Freedom to modify the vehicle
• No wear and tear charges
• Can sell anytime without penalties
• Lower total cost if keeping long-term

Example: Midsize Sedan Lease

Scenario: 2024 Midsize Sedan

Vehicle & Terms

MSRP:$35,000

Negotiated Price:$33,000

Residual Value (55%):$19,250

Lease Term:36 months

Money Factor:0.00125 (3% APR)

Payment Calculation

Depreciation:$382/month

Finance Charge:$65/month

Base Payment:$447/month

Sales Tax (8%):$36/month

Total Monthly:$483/month

Frequently Asked Questions

What happens if I exceed the mileage limit?

You'll pay an excess mileage fee, typically $0.15-$0.30 per mile over the limit. For example, if you exceed by 5,000 miles at $0.20/mile, you'd owe $1,000. Consider a higher mileage allowance if you drive more than average.

Can I end my lease early?

Yes, but early termination typically involves significant fees and penalties. You may owe the remaining payments, early termination fees, and disposition charges. Some lease transfer services allow you to transfer your lease to another person.

Should I put money down on a lease?

Generally, it's better to minimize down payments on leases. Unlike buying, you don't build equity, and if the car is totaled or stolen, you may lose your down payment. Instead, consider paying the first month's payment and fees upfront.