Auto Lease Calculator
Calculate your monthly car lease payment from negotiated price, down payment, residual value, money factor and sales tax.
- Depreciation$246.11 · 67%
- Finance Fee$98.21 · 27%
- Sales Tax$24.10 · 7%
67% of your lease payment is just the car's depreciation over the term — the rest is the finance fee (interest on the lease) and sales tax layered on top.
- Monthly Payment (before tax)$344.32
- Residual Value$19,140.00
About the Auto Lease Calculator
Lease math looks nothing like loan math, and that's exactly why lease payments feel opaque — instead of a familiar interest rate, dealers quote a 'money factor,' a small decimal that doesn't look like a percentage at all, and the payment itself is really two separate pieces (depreciation and a finance charge) stapled together rather than one amortized number.
This calculator breaks a lease payment into those actual pieces — what you're paying for the car's depreciation over the lease term, what you're paying in finance charges on top, and the tax layered onto both — so a lease quote can be checked line by line instead of taken on faith.
It's built for anyone comparing a lease offer against buying, or checking a dealer's quoted payment against the underlying negotiated price, residual and money factor.
The price, residual and rate details you enter stay in your browser and are never sent anywhere.
How it’s calculated
The depreciation fee is the car's expected loss in value over the lease — negotiated price minus residual value, spread evenly across the lease term. The finance fee is calculated from the 'money factor' (a small decimal, typically the equivalent APR divided by 2400) applied to the sum of the capitalized cost and residual value. Sales tax, where applicable, is then applied on top of both combined.
Money factor and APR describe the same underlying interest cost in different units — multiplying a money factor by 2400 converts it to something close to an equivalent annual percentage rate, which is what this calculator's rate field represents before converting back to a money factor internally.
Frequently asked questions
What is a money factor and how is it different from an interest rate?
A money factor is the lease-industry way of expressing the finance charge, shown as a small decimal (like 0.00208) instead of a percentage. Multiplying it by 2400 converts it to roughly the equivalent APR, which is easier to compare against loan rates you're used to seeing.
What is residual value and why does it matter so much?
Residual value is what the leasing company expects the car to be worth at the end of the lease term, usually expressed as a percentage of MSRP. A higher residual means less projected depreciation for you to pay for during the lease, which directly lowers the monthly payment.
Why is sales tax applied to the monthly payment instead of the full car price?
Many states tax lease payments only on the amount actually being paid each month (depreciation plus finance charge), rather than on the vehicle's full purchase price the way a cash sale or loan typically is — though the exact rule varies by state.
Is leasing cheaper than buying?
Not inherently — leasing typically produces a lower monthly payment because you're only paying for the car's depreciation over the term rather than its full value, but you don't build any equity and have mileage and condition limits, so the better financial choice depends on how long you keep vehicles and how much you drive.
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