Calculate lease payments for any asset — vehicles, equipment, or property. Enter asset value, residual value, interest rate, and term.
Our free lease calculator estimates your monthly lease payment for any asset, cars, equipment, or commercial property, based on the asset's value, its expected residual (end-of-lease) value, your interest rate, and lease term. It breaks the payment down into depreciation and finance charge components so you can see exactly what you're paying for.
Monthly Lease Payment = Depreciation Fee + Finance Fee (+ Tax, if applicable)
Depreciation Fee = (Adjusted Capitalized Cost − Residual Value) ÷ Lease Term (months). This is the portion of the asset's value you're using up during the lease.
Finance Fee = (Adjusted Capitalized Cost + Residual Value) × Money Factor, where the money factor is your annual interest rate divided by 2400 (an industry-standard convention originally used in auto leasing). The higher your down payment, the lower your adjusted capitalized cost, which lowers both components.
Residual value is the asset's estimated worth at the end of the lease term, set by the leasing company based on expected depreciation. A higher residual value generally means a lower monthly payment, since you're financing less of the asset's total depreciation.
Leasing typically has lower monthly payments than financing a purchase because you're only paying for the asset's depreciation during the lease term, not its full value. However, buying builds equity and has no mileage or usage restrictions, so total cost depends on how long you keep the asset.
A money factor is the lease equivalent of an interest rate, commonly used in vehicle leasing. To convert an annual interest rate to a money factor, divide by 2400; to convert a money factor to an approximate annual rate, multiply by 2400.
Yes. The asset's negotiated price (capitalized cost), down payment, and sometimes the money factor can often be negotiated, just like a purchase price. Residual value is typically set by the leasing company and is usually non-negotiable.