Car Lease Calculator
Calculate monthly lease payments. Compare leasing vs buying total costs. Free lease calculator.
How Lease Payments Work
Monthly lease payment has two parts: depreciation charge (the value the car loses during your lease) and finance charge (interest). Depreciation = (Cap Cost - Residual Value) / Term. Finance = (Cap Cost + Residual) x Money Factor. A lower negotiated price (cap cost) and higher residual value both reduce your payment. The money factor is the lease equivalent of an interest rate — multiply by 2,400 to get the approximate APR.
Lease vs Buy Analysis
Leasing makes financial sense when: you want a new car every 2-3 years, drive under 12,000 miles/year, want lower monthly payments, and prefer not to deal with selling used cars. Buying is better when: you plan to keep the car 5+ years, drive high mileage, want to own an asset, and prefer no restrictions on modifications. Over a 10-year period, buying is almost always cheaper in total cost.
The most profitable moment in car ownership is month 37 of a paid-off car. From that point, every month you drive it saves $400-800 that would otherwise be a payment. Most people trade in far too early.
