Auto Lease Calculator
Work out a car lease payment and the money factor behind it.
How a lease payment is built
With a lease you pay for the part of the car’s value you use up, plus a finance charge. The monthly payment has two parts: depreciation, which is the drop in value from today’s price to the residual value at the end, and a finance charge based on the money factor.
Example
A 35,000 car with 2,000 down and a 60% residual over 36 months at 6% has a money factor of 0.0025. Depreciation is about 333 a month and the finance charge about 135, so the payment is about 468 before tax and about 501 with 7% tax.
Dealers often quote a money factor instead of an APR; multiply it by 2,400 to compare. A higher residual value lowers the payment. Mileage limits, wear charges and fees at the end are not included, and tax rules differ by place.
Frequently asked questions
What is a money factor?
A small decimal, such as 0.0025, that stands for the interest rate on a lease. Multiply by 2,400 to get the approximate APR.
Is leasing cheaper than buying?
The payment is often lower, but you own nothing at the end. Compare total costs for how long you keep cars.
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