The Auto Lease Calculator estimates your monthly car lease payment based on the vehicle price, residual value, money factor (or interest rate), lease term, down payment, trade-in, and sales tax. It also compares leasing to buying the same vehicle. Enter your details and click Calculate.
The auto lease calculator determines the monthly payment for leasing a vehicle and breaks that payment down into its component parts - depreciation, finance charge, and tax. Leasing works very differently from buying with a loan: instead of paying off the entire value of the car, you pay only for the portion of the vehicle's value you "use up" during the lease term, plus a finance charge and sales tax. By entering the vehicle price, residual value, money factor or interest rate, lease term, down payment, trade-in value, and sales tax rate, you instantly see your estimated monthly lease payment and a full cost breakdown - along with a side-by-side comparison of what it would cost to buy the same car instead.
Understanding exactly how a lease payment is built is the single best way to negotiate a better deal and to avoid the common traps that make leasing more expensive than it needs to be.
A monthly lease payment has three parts: the depreciation fee, the finance fee (also called the rent charge), and tax. The calculator computes each separately and adds them together.
Depreciation is the largest component of most lease payments. It represents the value the car loses during your lease - the difference between what the car is worth at the start (the capitalized cost) and what it will be worth at the end (the residual value), spread evenly over the term.
Depreciation Fee = (Adjusted Cap Cost − Residual Value) ÷ Lease Term
The adjusted capitalized cost is the negotiated vehicle price minus any down payment (cap cost reduction) and trade-in value. Example: On a $50,000 car with $10,000 down and a $24,000 residual over 36 months, the depreciation fee is ($40,000 − $24,000) ÷ 36 = $444.44 per month.
The finance fee is the cost of borrowing - the lease equivalent of interest. It is calculated using the money factor, a small decimal number that represents the interest rate in lease terms.
Finance Fee = (Adjusted Cap Cost + Residual Value) × Money Factor
Notice the finance fee adds the cap cost and residual rather than subtracting - this is because you are paying interest on both the amount being depreciated and the residual value the leasing company still owns. Example: ($40,000 + $24,000) × 0.00208 = $133.12 per month.
In most U.S. states, sales tax on a lease is applied to the monthly payment (depreciation + finance fee) rather than the full vehicle price. The calculator multiplies the base monthly payment by your tax rate.
Monthly Tax = (Depreciation Fee + Finance Fee) × Sales Tax Rate
Example: ($444.44 + $133.12) × 7% = $40.43. Adding all three parts gives a total monthly lease payment of $444.44 + $133.12 + $40.43 = $617.99.
The money factor is how leasing companies express the interest rate on a lease. It is a small decimal - for example, 0.00208 - and it is directly convertible to an annual percentage rate (APR):
APR = Money Factor × 2400 | Money Factor = APR ÷ 2400
So a money factor of 0.00208 equals an APR of 0.00208 × 2400 = 4.99%. The calculator lets you enter either a money factor or an interest rate - whichever your dealer quotes - and it converts between them automatically. The magic number 2400 comes from combining the 12 months in a year with the factor-of-2 that arises because, on average, you owe about half the financed amount over the term.
Money factors are often quoted by dealers without explanation, and a higher money factor than your credit deserves is one of the most common ways leases are marked up. Always ask for the money factor, convert it to an APR, and compare it to current auto loan rates.
Residual value has an enormous effect on your monthly payment, and it works in a way that surprises many people: a higher residual value lowers your payment. That is because depreciation - the biggest part of the payment - is the difference between the cap cost and the residual. The higher the residual, the less the car depreciates on paper during your lease, and the less you pay. This is why cars that hold their value well (have high residuals) are often the cheapest to lease, even if their purchase price is high. Residual value is set by the leasing company and is generally not negotiable, but it is worth comparing residuals across models when deciding what to lease.
The calculator shows a side-by-side comparison of leasing versus buying the same vehicle with a loan. Neither is universally better - it depends on your priorities.
As a general rule, leasing tends to favor people who value low payments and a new car every few years, while buying favors those who keep cars a long time and want to minimize total cost. The comparison in the results helps you weigh the trade-off with real numbers.
The negotiated price of the vehicle (the capitalized cost). Always negotiate this just as you would when buying - the lower the cap cost, the lower your payment. Do not focus only on the monthly payment, which dealers can manipulate.
The length of the lease in months. Shorter terms keep you in warranty and avoid the steepest later-year depreciation but have higher payments; longer terms lower the payment but may extend past the warranty.
Choose whichever your dealer quoted. Enter the money factor as a small decimal (e.g., 0.00208) or the interest rate as a percentage (e.g., 5). The calculator converts between them so you always know the true APR.
Both reduce the adjusted cap cost and therefore your monthly payment. Be cautious with large lease down payments, though: if the car is totaled or stolen early in the lease, you can lose that money. Many experts recommend minimizing the upfront payment on a lease.
Your state or local sales tax rate. In most states, lease tax is applied to the monthly payment; the calculator follows this common method and also computes the upfront tax on any down payment.
The vehicle's projected end-of-lease value, provided by the leasing company. Enter it as a dollar amount. A higher residual lowers your payment.
A lease payment is the sum of three parts: the depreciation fee (the cap cost minus the residual, divided by the term), the finance fee (the cap cost plus residual, times the money factor), and tax on those two amounts. The calculator computes each and adds them together.
The money factor is the lease version of an interest rate, written as a small decimal. Multiply it by 2400 to get the equivalent APR. For example, a money factor of 0.00208 equals about 4.99% APR.
Because depreciation - the largest part of the payment - is the difference between the cap cost and the residual value. A higher residual means the car loses less value on paper during your lease, so you pay less depreciation each month.
Leasing offers lower monthly payments and a new car every few years but no ownership; buying costs more per month but builds equity and is cheaper long-term if you keep the car. Use the comparison in the results to see the numbers for your situation.
Generally no. A large lease down payment lowers your monthly payment but is at risk if the vehicle is totaled or stolen early in the lease, since you may not recover it. Many experts recommend keeping the upfront payment as low as possible.
You typically have three options: return the car (paying any excess mileage or wear charges plus a disposition fee), buy it for the residual value, or lease or buy a new vehicle. The calculator's "cost to own after lease" assumes you purchase the car for its residual value at the end.