Lease Calculator
Calculate your monthly lease payment and total cost from the asset value, residual, money factor or interest rate, term, and tax.
Lease Calculator
Monthly lease payment from depreciation + finance charge + tax. Money factor and APR convert automatically (APR = money factor x 2400).
Estimated monthly payment
$0
Estimate only. Uses the common method of taxing the monthly payment. Some regions tax the full price, the depreciation only, or up-front fees; drive-off costs, acquisition and disposition fees are not included.
Example
A car has a net cap cost (negotiated price) of $30,000 and a residual value of $18,000 on a 36-month lease with a money factor of 0.00125 (equal to a 3.0% APR) and 8% sales tax.
- Monthly depreciation = ($30,000 - $18,000) / 36 = $333.33
- Monthly finance charge = ($30,000 + $18,000) x 0.00125 = $60.00
- Base payment = $333.33 + $60.00 = $393.33; tax = $393.33 x 8% = $31.47
- Monthly payment = $424.80, and the total of 36 payments = $15,292.80
How it works
Enter the negotiated price (net cap cost), residual value, term, tax rate, and either a money factor or APR. The tool adds the monthly depreciation and finance charges, applies tax, and shows the full breakdown live.
Good to know
The Lease Calculator estimates a monthly lease payment by combining three parts: monthly depreciation (the asset's value you use up over the term), the monthly finance charge (the lessor's cost of capital), and sales tax. You enter the negotiated price (net cap cost), the residual value, the term in months, a tax rate, and either a money factor or an APR. It is built for anyone comparing a vehicle or equipment lease quote and wanting to see whether the dealer's numbers add up before signing.
Reach for it when a dealer or salesperson gives you a single monthly figure with no breakdown, or when you want to test how changing one input shifts the payment. Lowering the negotiated price, securing a higher residual, or shortening the term all change the result in different ways, and the live breakdown lets you see exactly which lever moves the payment most.
To read the output, look past the headline payment to the per-month splits. Depreciation is fixed by the price-minus-residual gap divided by the term, the finance charge is what the lessor earns, and the tax line shows what the rate adds. The Equivalent APR converts your money factor (factor x 2400) so you can judge whether the financing is competitive, and the Total of payments shows the cash that leaves your pocket over the full lease.
Keep in mind what the estimate leaves out: it taxes the monthly payment, which is the common method but not universal, and it excludes drive-off costs such as the down payment, acquisition fee, disposition fee, registration, and any dealer add-ons. Treat the figure as a like-for-like comparison tool rather than the exact amount you will owe at signing.
Frequently asked questions
What is a money factor and how does it relate to APR?
The money factor is the lease equivalent of an interest rate. Multiply it by 2400 to get the approximate APR (for example 0.00125 x 2400 = 3.0%), or divide an APR by 2400 to get the money factor. This calculator converts between the two automatically.
Why does the calculator add the residual to the cap cost for the finance charge?
The standard lease finance charge applies the money factor to the sum of the net cap cost and the residual value, not just the amount financed. This is the money factor convention and is why the factor is so small compared with a normal interest rate.
Is my data uploaded anywhere?
No — this calculator runs entirely in your browser; nothing is uploaded.
Is this financial advice?
No. These are educational estimates — consult a qualified financial professional before making decisions.
People also ask
What is residual value in a lease?
Residual value is the lessor's projected worth of the asset at the end of the lease term, often expressed as a percentage of the original price. A higher residual means less of the asset's value is depreciating during your lease, which lowers the depreciation portion of your monthly payment.
How is a lease payment calculated?
A typical lease payment is the sum of monthly depreciation (net cap cost minus residual, divided by the term), the monthly finance charge (cap cost plus residual, multiplied by the money factor), and tax applied to that base payment. The calculator adds these three components together to produce the estimated monthly figure.
What is net cap cost in a car lease?
Net capitalized cost is the agreed price of the asset being leased after subtracting any down payment, trade-in credit, or rebates, and adding any fees rolled into the lease. It is the figure the lease payment is built from, so negotiating it down directly reduces your payment.
Is a lower money factor always better?
A lower money factor means a smaller finance charge and a lower equivalent APR, so for the financing cost alone, lower is generally better. However, the total payment also depends on the price, residual, term, and tax, so a low money factor does not guarantee the cheapest overall lease.
Why is my lease payment so high compared to a loan?
Lease payments cover depreciation plus a finance charge calculated on both the cap cost and the residual, and the depreciation can be steep if the price is high or the residual is low. Short terms and high tax rates also raise the monthly amount.
Does this calculator include the down payment and fees?
No. It estimates the recurring monthly payment from price, residual, term, rate, and tax only. Drive-off costs like a down payment, acquisition fee, disposition fee, and registration are not included in the result.
How do I convert APR to a money factor?
Divide the APR percentage by 2400 to get the money factor, or multiply the money factor by 2400 to get the approximate APR. For example, a 3.0% APR equals a money factor of 0.00125.
What is the difference between depreciation and finance charge on a lease?
Depreciation is the portion of the asset's value you consume during the term, calculated as the price minus the residual spread over the months. The finance charge is the lessor's interest-equivalent cost, calculated by applying the money factor to the sum of the cap cost and residual.
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