Estimate your monthly lease payments including depreciation and rent charges.
Adjusted Capitalized Cost:$0.00
Residual Value:$0.00
Monthly Depreciation:$0.00
Monthly Rent Charge:$0.00
Total Monthly Payment:$0.00
How Car Lease Payments are Calculated
Unlike a traditional car loan where you pay for the entire value of the vehicle, a lease only charges you for the portion of the car's value that you "use up" during the lease term, plus interest and fees. This is why lease payments are typically lower than loan payments for the same vehicle.
The Core Components of a Lease
To use our car lease calculator effectively, you should understand these four key terms:
Gross Capitalized Cost: This is the negotiated price of the vehicle. Just like buying a car, you can and should negotiate this number lower than the MSRP.
Adjusted Capitalized Cost: This is the Gross Cap Cost minus any down payments, trade-ins, or manufacturer rebates. This is the actual amount being financed.
Residual Value: This is the estimated value of the car at the end of the lease. It is set by the leasing company. A higher residual value means lower monthly payments because you are paying for less depreciation.
Money Factor: This is essentially the interest rate on a lease. To convert an APR to a Money Factor, divide the APR by 2400. For example, a 6% APR equals a 0.0025 Money Factor.
Real-World Example Calculation
Imagine you are leasing a $40,000 SUV for 36 months. The dealer offers a 60% residual value and an interest rate of 4.8% (0.002 Money Factor). You put $4,000 down.
The best way to lower your payment is to negotiate the Gross Capitalized Cost. Many people mistakenly believe that lease prices are non-negotiable. Additionally, look for vehicles with high residual values (cars that hold their value well), as these naturally result in lower monthly costs.
function calculateLease() {
var msrp = parseFloat(document.getElementById("msrp").value);
var downPayment = parseFloat(document.getElementById("downPayment").value) || 0;
var tradeIn = parseFloat(document.getElementById("tradeIn").value) || 0;
var term = parseFloat(document.getElementById("leaseTerm").value);
var residualRate = parseFloat(document.getElementById("residualRate").value);
var apr = parseFloat(document.getElementById("apr").value);
if (isNaN(msrp) || isNaN(term) || isNaN(residualRate) || isNaN(apr) || term <= 0) {
alert("Please enter valid positive numbers for all fields.");
return;
}
// 1. Adjusted Capitalized Cost
var adjCapCost = msrp – downPayment – tradeIn;
// 2. Residual Value
var residualValue = msrp * (residualRate / 100);
// 3. Monthly Depreciation
var monthlyDepreciation = (adjCapCost – residualValue) / term;
// 4. Money Factor
var moneyFactor = apr / 2400;
// 5. Monthly Rent Charge
var monthlyRent = (adjCapCost + residualValue) * moneyFactor;
// 6. Total Monthly Payment
var totalPayment = monthlyDepreciation + monthlyRent;
// Display results
document.getElementById("resCapCost").innerText = "$" + adjCapCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resResidual").innerText = "$" + residualValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resDepreciation").innerText = "$" + monthlyDepreciation.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resRent").innerText = "$" + monthlyRent.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resTotal").innerText = "$" + totalPayment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById("resultArea").style.display = "block";
}