Auto Lease Calculator

Calculate monthly lease payments for a vehicle. Enter MSRP, negotiated cap cost, residual value, money factor, and lease term.

$
$
%
$
$
%

The money factor looks like a made-up number, and the 2400 that converts it to an APR looks arbitrary, but both fall out of the lease formula itself. The finance charge is (cap cost + residual) × money factor because the average amount being financed is half of (cap cost + residual), and a year has 12 months, so APR as a percentage = money factor × 2 × 12 × 100 = money factor × 2400. At the default 0.00125 that is 3.00%.

Depreciation plus rent charge, with tax on top

Residual value = MSRP × residual %. Adjusted cap cost = negotiated cap cost + acquisition fee − down payment. Depreciation = (adjusted cap cost − residual) ÷ term in months. Finance charge = (adjusted cap cost + residual) × money factor. Base payment = depreciation + finance charge, and sales tax is the tax rate × base payment, added to give the monthly payment.

What changes if one input moves? Measured against the default payment of $448.40, doubling the money factor from 0.00125 to 0.0025 adds $69.05 and takes the payment to $517.44. Negotiating $1,000 off the cap cost saves $31.35 a month. One more point of residual (56% instead of 55%) saves $10.03. Dropping the term to 24 months at the same residual lifts the payment to $638.07, though real quotes usually carry a higher residual on shorter terms, so that comparison overstates the jump.

Worked example: MSRP $35,000 × 55% = $19,250 residual. Cap cost $33,000 + $895 − $2,000 = $31,895. Depreciation = ($31,895 − $19,250) ÷ 36 = $351.25. Finance charge = ($31,895 + $19,250) × 0.00125 = $63.93. Base payment = $415.18, and 8% tax adds $33.21, so the payment is $448.40. Rounding happens only in the display.

How to Use This Calculator

  1. Enter the vehicle's MSRP. The residual percentage is applied to this figure, not to the negotiated price.
  2. Enter the negotiated cap cost, meaning the selling price before fees, incentives and any cap cost reduction.
  3. Enter residual percent and money factor exactly as they appear on the lessor's quote. If a dealer quotes an APR, divide it by 2400 first.
  4. Set the term in months and any down payment, which the page treats as a cap cost reduction.
  5. Add the acquisition fee, which the page adds to the cap cost, and your sales tax rate.
  6. Press Calculate and compare the depreciation line with the finance charge to see where the money goes.

Frequently Asked Questions

How do I convert a dealer's APR into a money factor?

Divide by 2400. A 4.8% APR is 4.8 ÷ 2400 = 0.002. To go the other way, multiply the money factor by 2400.

Why is the residual a percent of MSRP and not of what I pay?

Lessors set the residual from the sticker price, not the negotiated one, so haggling lowers the cap cost without changing the residual. The percentage itself is usually the lessor's call and varies by model and term.

Does the tax line match my state's rules?

It is a simple estimate: base payment × your rate. Some states tax the full price, the cap cost reduction or fees up front, or at different rates, so check yours.

Does a bigger down payment make sense on a lease?

It lowers the payment, and $2,000 more cuts this example by $62.70 a month. But cap cost reductions are generally not refunded if the car is totaled early, so read the contract before putting more money down.

What is not included?

Mileage allowance and excess-mileage charges, disposition fees, registration, insurance and any end-of-lease wear charges. Ask the dealer for the full amount due at signing.