Lease Calculator

Estimate your monthly car lease payment using the standard depreciation-fee-plus-finance-fee formula lessors use: enter the negotiated price, down payment, residual value, lease term, money factor, and sales tax rate.

Quick Facts

Formula
Payment = Depreciation Fee + Finance Fee
Depreciation fee spreads (adjusted cap cost − residual) over the term; the finance fee is (adjusted cap cost + residual) × money factor.
Money factor to APR
APR ≈ money factor × 2400
A money factor of 0.00125 is roughly equivalent to a 3% annual interest rate.

Your Results

Calculated
Monthly payment
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Depreciation + finance fee + tax
Depreciation fee
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Monthly value lost, before tax
Finance fee (rent charge)
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Monthly cost of the money factor
Total cost of lease
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All payments plus down payment

Ready

Enter the price, down payment, residual value, term, money factor, and tax rate, then press Calculate.

How the Lease Calculator works

Leasing a car means paying for the portion of its value you use up during the lease term, plus a finance charge on the money tied up in the vehicle. This calculator uses the standard method finance companies use to build a lease quote: a depreciation fee, a finance fee (rent charge), and sales tax layered on top.

The formula

Start with the Adjusted Capitalized Cost: the negotiated vehicle price minus your down payment or trade-in credit. Then:

Depreciation Fee = (Adjusted Cap Cost − Residual Value) / Lease Term

Finance Fee = (Adjusted Cap Cost + Residual Value) × Money Factor

Adding these two gives the pre-tax monthly payment. Sales tax is then applied to that payment (the method used by most, but not all, states), and the taxed amount is your total monthly payment.

Worked example

Take a $35,000 vehicle with a $3,000 down payment, a $19,250 residual value (55% of MSRP), a 36-month term, a money factor of 0.00125, and 7% sales tax. The adjusted cap cost is $32,000. Depreciation fee = ($32,000 − $19,250) / 36 ≈ $354.17/month. Finance fee = ($32,000 + $19,250) × 0.00125 ≈ $64.06/month. Pre-tax payment ≈ $418.23, and with 7% tax the total monthly payment is about $447.51.

What moves the payment most

  • Residual value: a higher residual (the vehicle holds its value well) shrinks the depreciation fee, since less value needs to be paid off over the term.
  • Money factor: multiply it by 2400 to see the rough equivalent APR — a money factor of 0.00125 is about 3%. Negotiating this down lowers the finance fee directly.
  • Lease term: a longer term spreads depreciation over more months, lowering the monthly payment, but the finance fee accrues for longer, so total lease cost does not always drop proportionally.
  • Down payment: reduces the adjusted cap cost and therefore both fees, but money put down on a lease is generally not recoverable if the vehicle is totaled early, so weigh that trade-off before putting more down.

Assumptions and limits

This calculator assumes tax is applied to the monthly payment, a common method but not universal — some states tax the full price up front or the down payment separately. It excludes acquisition fees, disposition fees, registration, and add-on products that a real dealer quote may include. Use it to sanity-check a lease worksheet, not as a substitute for the itemized figures a dealer or leasing company provides.

Frequently Asked Questions

How is a car lease payment calculated?
A lease payment has two parts: a depreciation fee and a finance fee. Depreciation fee = (Adjusted Capitalized Cost − Residual Value) / Lease Term in months. Finance fee (rent charge) = (Adjusted Capitalized Cost + Residual Value) × Money Factor. The two are added together, then sales tax is applied to get the total monthly payment. Adjusted Capitalized Cost is the negotiated vehicle price minus any down payment or trade-in credit.
What is a money factor and how does it relate to APR?
The money factor is the lease equivalent of an interest rate, usually shown as a small decimal such as 0.00125. Multiply the money factor by 2400 to get an approximate equivalent APR: 0.00125 × 2400 = 3%. A lower money factor means a smaller finance fee and a lower monthly payment.
What is residual value in a lease?
Residual value is the vehicle's projected worth at the end of the lease term, set by the leasing company (often as a percentage of MSRP). A higher residual value lowers the depreciation fee because less of the vehicle's value needs to be paid off during the lease, which reduces the monthly payment.
Why is my payment taxed after the depreciation and finance fees are added?
In most states that tax leases, sales tax is charged on the monthly payment amount rather than the full vehicle price, which is why this calculator applies the tax rate after depreciation and finance fees are combined. Some states use different methods (taxing the full price up front or the down payment separately), so treat this as a standard estimate and confirm the method your state uses.

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