Car Lease Calculator
The monthly payment on a car lease from the price, down payment, residual value, money factor or APR, term and fees, split into its depreciation and finance parts, with any tax on the payment.
Result…
How it's calculated
Capitalised cost = price + fees − down payment − trade-in Depreciation part = (capitalised cost − residual) ÷ months Finance part = (capitalised cost + residual) × money factor Money factor = APR ÷ 2400 Payment = (depreciation + finance) × (1 + tax rate)
A lease payment pays for the value the car loses while you drive it plus a finance charge. The depreciation part spreads the drop from the capitalised cost to the residual value over the term. The finance part is the money factor times the capitalised cost plus the residual, which is the same as charging the APR on the average amount owed; that is why APR ≈ money factor × 2400. Any sales tax you enter is added to each payment.
Your numbers, step by step
About the Car Lease calculator
This car lease calculator works out the monthly payment on a lease from the figures on your quote. Enter the agreed price, any fees rolled into the lease, the down payment and trade-in, the residual value as a percentage of the list price or as an amount, the lease rate as a money factor or an APR, and the term. The payment has two parts: depreciation, which spreads the drop from the capitalised cost to the residual over the months, and a finance charge, which is the money factor times the capitalised cost plus the residual. The calculator converts between the two rate forms with APR = money factor × 2400, and adds any sales tax you enter to each payment, since lease tax rules differ by country and region. The steps show each part with your numbers, so you can check a dealer's figures line by line.
How to use it
- Enter the “Agreed price (capitalised cost)”, any “Fees added to the lease”, your “Down payment” and any “Trade-in credit”.
- Under “Residual value as”, choose a percentage of the “List price” or an amount, and enter the residual from your quote.
- Under “Lease rate as”, choose “Money factor” or “APR” and enter the rate.
- Enter the “Term” in months and, if tax is charged on each payment where you live, the “Sales tax on the payment”.
- Read the monthly payment and its depreciation and finance parts.
Worked example
Take a car with an agreed price of 32,000, 800 of fees added and 2,500 down, so the capitalised cost is 30,300. The residual is 56% of a 34,000 list price, which is 19,040. A 4.8% APR is a money factor of 4.8 ÷ 2400 = 0.002. Over 36 months the depreciation part is (30,300 − 19,040) ÷ 36 = 312.78 and the finance part is (30,300 + 19,040) × 0.002 = 98.68, so the payment is 411.46 before any tax, or 14,812.48 over the lease.
Updated
Questions people ask
How is a car lease payment calculated?
Add the depreciation part, (capitalised cost − residual value) ÷ months, to the finance part, (capitalised cost + residual value) × money factor. Any tax charged on the payment is then added on top.
How do I convert a money factor to an APR?
Multiply the money factor by 2400: 0.0025 × 2400 = 6%. To go the other way, divide the APR by 2400. The 2400 comes from 12 months, 100 for the percentage and 2 because the charge is on the average of the start and end values.
What is the residual value on a lease?
It is what the car is set to be worth at the end of the lease, usually a percentage of the list price fixed by the lessor. A higher residual means less depreciation to pay for, so a lower payment.
What is a common mistake when comparing lease offers?
Looking only at the monthly payment. A large down payment or fees due at signing can make a payment look low, so compare the total of payments plus everything paid up front. For buying instead, see the auto loan calculator.
Does this include every cost of a lease?
No. Contracts can add fees at signing, a deposit, mileage limits and charges for wear or extra distance at the end, and tax rules differ by place. Check the full contract, and ask the lessor or a qualified adviser about anything you don't understand before you sign.