Lease Calculator - Calculate Monthly Lease Payments
Free lease calculator to determine monthly lease payments, total lease cost, and complete breakdown for vehicle and equipment leasing with depreciation and finance fee analysis
Lease Calculator
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What is a Lease Calculator?
A Lease Calculator is a free financial tool that helps you calculate your monthly lease payment amount based on the vehicle or equipment price, residual value, money factor (interest rate), lease term, and down payment. It determines the fixed monthly payment you need to make to lease a vehicle or equipment over a specific period.
This calculator works for various lease types including:
- Vehicle leases - Calculate monthly payments for car, truck, and SUV leases
- Luxury vehicle leases - Estimate high-end vehicle lease payments and costs
- Commercial vehicle leases - Determine business vehicle lease expenses
- Equipment leases - Calculate leasing costs for machinery and equipment
- Technology leases - Plan computer and technology equipment leasing
To compare leasing versus buying with traditional auto financing, check out our Auto Loan Calculator to calculate purchase loan payments including trade-in value, taxes, and fees with complete cost comparison.
For standard loan payment calculations when considering buying instead, explore our Loan Calculator to determine monthly purchase payments and total interest costs for vehicle ownership.
To understand payment schedules if you decide to finance a purchase, use our Amortization Calculator to see how loan payments build equity over time compared to lease payments that don't.
For boat and marine equipment leasing with similar residual calculations, try our Boat Loan Calculator to compare marine financing options and determine the best approach for watercraft acquisition.
For personal loan financing to purchase equipment outright, check our Personal Loan Calculator to evaluate unsecured financing options and compare against leasing costs.
How Lease Calculator Works
The calculation uses the standard lease payment formula (November 2025):
Where:
- Depreciation Fee = (Capitalized Cost - Residual Value) / Lease Term
- Finance Fee = (Capitalized Cost + Residual Value) × Money Factor
- Capitalized Cost = Vehicle Price - Down Payment
- Residual Value = Vehicle Price × Residual Percentage
This formula calculates the fixed monthly payment needed to lease the vehicle or equipment over the specified term, including both depreciation and finance charges.
Key Concepts Explained
The amount being financed in the lease, equal to the vehicle price minus any down payment or trade-in value. This is the starting point for lease calculations.
The estimated value of the vehicle at the end of the lease term, expressed as a percentage of MSRP (typically 50-60% for 3-year leases). Higher residual values result in lower monthly payments.
The interest rate used in lease calculations, expressed as a small decimal. To convert APR to money factor, divide by 2400. To convert money factor to APR, multiply by 2400.
The portion of your monthly payment that covers the vehicle's loss in value during the lease term. This is the difference between capitalized cost and residual value, divided by months.
The interest portion of your monthly payment, calculated by multiplying the sum of capitalized cost and residual value by the money factor. This represents the cost of financing.
Any upfront payment (down payment, trade-in value, or rebates) that reduces the capitalized cost, thereby lowering your monthly payment amount.
How to Use This Calculator
- Enter Vehicle Price - Input the MSRP or agreed upon price of the vehicle or equipment
- Set Residual Value - Enter the residual percentage (typically 50-60% for 3-year leases, higher for shorter terms)
- Input Money Factor - Enter the money factor provided by the dealer (or divide APR by 2400)
- Choose Lease Term - Specify the lease duration in months (common terms: 24, 36, or 48 months)
- Add Down Payment - Enter any upfront payment to reduce monthly costs
- Include Taxes & Fees - Add estimated taxes and fees for accurate payment calculation
- Calculate - Click Calculate to see your monthly payment and total lease cost
- Compare Options - Adjust values to see how different terms and payments affect your lease
Tip: Try different down payment amounts and lease terms to find the best balance between upfront costs and monthly payments.
Benefits of Using This Calculator
- Budget Planning - Determine if the monthly lease payment fits your budget before visiting dealers
- Compare Lease Terms - Evaluate different lease durations and their impact on monthly payments
- Understand True Cost - See total lease cost including all fees and finance charges
- Lease vs Buy Analysis - Compare leasing costs against buying to make informed decisions
- Negotiate Better Deals - Use calculations to negotiate better money factors and residual values
- Free and Instant - Get immediate results without signing up or providing personal information
- Transparent Breakdown - See exactly how depreciation and finance fees contribute to your payment
- Down Payment Impact - Understand how different down payments affect monthly costs
Factors Affecting Lease Payments
- Vehicle Price - Higher MSRP results in higher monthly lease payments and total cost
- Residual Value - Higher residual percentages significantly reduce monthly payments by lowering depreciation
- Money Factor - Lower money factors (interest rates) reduce the finance fee portion of your payment
- Lease Term - Longer lease terms generally have lower residual values, increasing monthly payments
- Down Payment - Larger upfront payments reduce capitalized cost and monthly payments
- Credit Score - Better credit scores typically qualify for lower money factors (better rates)
- Vehicle Type - Luxury and popular vehicles often have higher residual values, lowering payments
- Mileage Allowance - Higher mileage limits typically result in lower residual values and higher payments
- Manufacturer Incentives - Special lease deals can include subsidized money factors or residual values
- Local Taxes - State and local tax rates affect the total monthly payment amount
Frequently Asked Questions
What is a lease calculator?
A lease calculator is a free financial tool that helps you calculate monthly lease payments for vehicles or equipment based on the purchase price, residual value, money factor, lease term, and down payment. It shows the depreciation fee, finance fee, and total lease cost.
How is the monthly lease payment calculated?
Monthly lease payment equals Depreciation Fee + Finance Fee + Taxes. Depreciation Fee = (Capitalized Cost - Residual Value) / Lease Term. Finance Fee = (Capitalized Cost + Residual Value) × Money Factor. Capitalized Cost = Vehicle Price - Down Payment.
What is a money factor in leasing?
A money factor is the interest rate used in lease calculations, expressed as a small decimal (typically 0.001 to 0.005). To convert APR to money factor, divide by 2400. For example, 6% APR ÷ 2400 = 0.0025 money factor.
What is residual value in a lease?
Residual value is the estimated worth of the vehicle at the end of the lease term, typically 50-60% of MSRP for a 3-year lease. Higher residual values result in lower monthly payments because you're only paying for the depreciation.
Is leasing better than buying?
Leasing offers lower monthly payments and newer vehicles more frequently, but you don't build equity. Buying costs more monthly but you own the asset. Leasing is better for lower payments and frequent upgrades; buying is better for long-term ownership.
What fees should I expect when leasing?
Common lease fees include acquisition fee ($300-$1000), documentation fees, registration fees, sales tax on payments, disposition fee at lease end ($300-$500), and potential excess mileage or wear-and-tear charges.