Car Lease Calculator - Payment, Money Factor, Residual & Scenario Comparison
You're looking at a $28,000 compact, negotiated to $26,500, with $1,500 down and a 36-month lease. At a typical money factor and 55% residual, expect roughly $355/month before tax and insurance—not the sticker price. Plug in the dealer quote below to see depreciation, finance charge, and drive-off cost.
Lease details
Enter vehicle and lease terms
Cap cost before reductions
% of MSRP
≈ APR / 2400
Monthly payment
Estimated lease payment breakdown
Monthly payment
$354.90
$331.68 base + $23.22 tax
Methodology and limitations
Last reviewed:
Methodology
Estimates car lease monthly payment from MSRP, selling price (cap cost), residual value, money factor, term, down payment, trade-in, fees, and sales tax. Uses standard lease formula: depreciation fee + finance charge + tax. Supports scenario comparison.
Limitations
Planning estimate. Actual lease terms depend on dealer negotiation, credit approval, manufacturer incentives, disposition fees, mileage limits, and state lease tax rules. Verify against dealer lease contract.
Official sources
How Car Lease Payments Are Calculated
You're looking at a $28,000 compact, negotiated to $26,500, with $1,500 down and a 36-month lease. At a typical money factor and 55% residual, expect roughly $355/month before tax and insurance—not the sticker price. Plug in the dealer quote below to see depreciation, finance charge, and drive-off cost.
Method used
Lease payment is depreciation fee plus rent (finance) charge. Depreciation is (capitalized cost − residual) / term. Rent charge is (capitalized cost + residual) × money factor. Optional tax applies to the payment; scenario A vs B compares two quote structures.
Payment = (cap − residual) / term + (cap + residual) × money factor; money factor ≈ APR / 2400
Practical example
You're leasing a $28,000 compact negotiated to $26,500 cap cost, 55% residual, 0.00125 money factor, $1,500 down, 36 months—expect roughly $355/month before tax and insurance. Compare a second scenario if the term changes.
- MSRP/cap cost: $28,000 → $26,500 negotiated
- 55% residual, 0.00125 money factor
- $1,500 down, 36-month term
≈ $355/month before tax; depreciation and rent charge breakdown
What this includes
- Money factor or APR conversion
- Residual % or dollar residual
- Fees, down payment, tax, and A/B scenario comparison
What this excludes
- Mileage overage, wear-and-tear fees, acquisition fee nuances beyond entered fees, and early termination
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Frequently Asked Questions
What is a car lease money factor?
Money factor is the lease equivalent of an interest rate. It is often quoted as a small decimal like 0.00125. To convert to APR, multiply by 2400: 0.00125 × 2400 = 3% APR. Lower money factors mean lower finance charges. Dealers may quote APR instead; this calculator accepts either and converts automatically.
What is residual value in a car lease?
Residual value is the estimated car value at lease end - your buyout price if you choose to purchase. Leases with higher residuals have lower depreciation and lower monthly payments but higher buyout costs. A $28,000 car with 55% residual has a $15,400 buyout. Lower residuals increase monthly payments but reduce buyout.
How is lease payment calculated?
Lease payment has two parts: depreciation fee and finance charge. Depreciation fee = (Cap Cost − Residual) / Term. Finance charge = (Cap Cost + Residual) × Money Factor. Add both, then add sales tax on the payment. Cap cost is selling price plus fees minus down payment and trade-in. This calculator models the standard lease formula.
Should I put money down on a lease?
Putting money down reduces monthly payments but increases upfront cost. If the car is totaled early, insurance may not cover the down payment. Many lease advisors recommend minimal or zero down. Use the scenario comparison in this calculator to see payment differences at various down payment levels and decide based on your cash flow and risk tolerance.
Is a 36-month or 48-month lease better?
A 36-month lease keeps you in a newer car with less maintenance risk. A 48-month lease on the same $28,000 compact might drop the payment from roughly $355/month to the low $300s before tax, but you pay longer and the residual is often lower. Use the scenario comparison tab to see payment and total cost side by side.
Does this calculator include sales tax?
Yes. Enter your sales tax rate and the calculator applies it to the base monthly payment. Some states tax the full cap cost; others tax only monthly payments. This calculator uses the payment-based model which is more common. Verify your state's lease tax rules with the dealer before signing.