Calculate your monthly lease payment and understand the rent charges.
24 Months
36 Months
48 Months
60 Months
Note: APR / 2400 = Money Factor
Estimated Monthly Payment: $0.00
Base Depreciation: /mo
Rent Charge (Interest): /mo
Sales Tax: /mo
Residual Value Amount:
Total Cost of Lease:
Adj. Cap Cost:
How Car Lease Payments are Calculated
A car lease payment isn't just a random number; it is based on a specific mathematical formula that accounts for the car's depreciation and the cost of borrowing money. Understanding these factors can help you negotiate a better deal at the dealership.
1. Adjusted Capitalized Cost
This is the "starting price" of the lease. It is calculated by taking the Negotiated Sales Price and subtracting any Down Payment or Trade-in Allowance. For example, if you negotiate a car down to $32,000 and put $2,000 down, your Adjusted Cap Cost is $30,000.
2. Residual Value
The residual value is what the leasing company predicts the car will be worth at the end of your lease term. This is calculated as a percentage of the MSRP (not the sales price). If a $35,000 car has a 55% residual value after 36 months, the residual value is $19,250.
3. Monthly Depreciation Fee
The biggest part of your payment is paying for the value the car loses while you drive it. The formula is: (Adjusted Cap Cost – Residual Value) / Lease Term.
4. Money Factor (Rent Charge)
The money factor is essentially the interest rate on a lease. Unlike a standard loan where interest is calculated on the remaining balance, lease interest (rent charge) is calculated using this formula: (Adjusted Cap Cost + Residual Value) × Money Factor.