Car Lease Calculator
Car leases let you drive a vehicle with lower monthly payments than purchasing, with the option to buy at lease end.
What This Calculator Shows
- Monthly Payment: Your expected payment amount based on loan terms
- Total Interest: The cost of borrowing over the loan lifetime
- Amortization Schedule: How payments split between principal and interest
- Payment Breakdown: Visual representation of your loan costs
How to Calculate
1. Enter your loan amount 2. Input the interest rate (APR) 3. Select the loan term 4. Review your payment details and total costs
Key Considerations for Car Lease
- Compare offers from multiple lenders before committing
- Understand all fees including origination, closing costs, and prepayment penalties
- Consider how rate changes might affect your payments (for variable rates)
- Factor in your overall financial goals and debt-to-income ratio
| Term | Meaning |
|---|---|
| Capitalised cost | The negotiated price (negotiate it exactly as you would a purchase) |
| Residual value | What the car is projected to be worth at lease end, as a % of MSRP |
| Money factor | The interest rate ÷ 2400 |
monthly = (cap cost − residual) ÷ months + (cap cost + residual) × money factor
`A money factor of 0.00250 is a 6% APR. Dealers quote the factor precisely because it does not
look like a rate.
| Lease 3 yr | Buy with a 5-yr loan | |
|---|---|---|
| Monthly | $450 | $676 |
| After 3 years | Nothing owned | ~$14,000 of equity |
| After 6 years | Two leases, nothing owned | Owned outright, no payment |
Leasing is cheaper monthly and more expensive permanently. It suits people who want a new car
every three years and accept a payment forever; buying suits everyone else. Watch the mileage
cap — overages run 15–30¢ a mile.The Numbers This Page Opens With
The calculator above starts at $35,000 over 3 years at 6%, which is
representative for this product:
| Monthly payment | $1,065 |
| Total repaid | $38,332 |
| Total interest | $3,332 |
| Interest as a share of principal | 10% |
Change any input above and every figure recalculates. The amortisation formula behind it:`
M = P × [ r(1+r)^n ] / [ (1+r)^n − 1 ]
P = principal, r = monthly rate (annual ÷ 12), n = number of payments
``
Before You Sign
- Compare APR, not the rate. APR includes origination and points; the rate does not.
- Ask about prepayment penalties. They turn a plan to pay early into a fee.
- Rate-shop inside 14 days. Credit scoring models treat multiple mortgage or auto
- Check whether the payment includes escrow. A mortgage quote without taxes and insurance