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Car Lease Payment Calculator

Estimated Monthly Payment: $0.00

Monthly Depreciation: $0.00

Monthly Rent Charge: $0.00

Monthly Tax: $0.00

Total Cost of Lease: $0.00

function calculateLease() { var msrp = parseFloat(document.getElementById('msrp').value) || 0; var salesPrice = parseFloat(document.getElementById('salesPrice').value) || 0; var downPayment = parseFloat(document.getElementById('downPayment').value) || 0; var tradeIn = parseFloat(document.getElementById('tradeIn').value) || 0; var residualPercent = parseFloat(document.getElementById('residualPercent').value) || 0; var term = parseFloat(document.getElementById('leaseTerm').value) || 36; var moneyFactor = parseFloat(document.getElementById('moneyFactor').value) || 0; var taxRate = parseFloat(document.getElementById('salesTax').value) || 0; if (msrp <= 0 || salesPrice <= 0) { alert("Please enter valid MSRP and Negotiated Price."); return; } // 1. Gross Capitalized Cost (simplified) var capCost = salesPrice – downPayment – tradeIn; // 2. Residual Value var residualValue = msrp * (residualPercent / 100); // 3. Monthly Depreciation var monthlyDepreciation = (capCost – residualValue) / term; if (monthlyDepreciation < 0) monthlyDepreciation = 0; // 4. Monthly Rent Charge (Interest) // Formula: (Cap Cost + Residual Value) * Money Factor var monthlyRentCharge = (capCost + residualValue) * moneyFactor; // 5. Pre-tax payment var basePayment = monthlyDepreciation + monthlyRentCharge; // 6. Tax var monthlyTax = basePayment * (taxRate / 100); // 7. Total Payment var totalPayment = basePayment + monthlyTax; var totalCostOfLease = (totalPayment * term) + downPayment + tradeIn; // Display results document.getElementById('totalMonthly').innerHTML = "$" + totalPayment.toFixed(2); document.getElementById('resDepreciation').innerHTML = "$" + monthlyDepreciation.toFixed(2); document.getElementById('resRentCharge').innerHTML = "$" + monthlyRentCharge.toFixed(2); document.getElementById('resTax').innerHTML = "$" + monthlyTax.toFixed(2); document.getElementById('resTotalLease').innerHTML = "$" + totalCostOfLease.toFixed(2); document.getElementById('lease-results').style.display = 'block'; }

Understanding Your Car Lease Calculation

Leasing a vehicle can be more complex than a standard car loan. Instead of paying for the entire value of the car, you are essentially paying for the depreciation that occurs during the time you drive it, plus interest (the money factor) and taxes.

Key Terms Explained

• MSRP: The Manufacturer's Suggested Retail Price. This is the baseline used to calculate the residual value.
• Money Factor: This represents the interest rate on the lease. To convert a Money Factor to APR, multiply it by 2,400. For example, a money factor of 0.00125 is equivalent to a 3% APR.
• Residual Value: The estimated value of the car at the end of the lease term. A higher residual value results in lower monthly payments because you are paying for less depreciation.
• Capitalized Cost: Often called "Cap Cost," this is the negotiated price of the vehicle minus any down payments, rebates, or trade-in credits.

Example Calculation

Imagine you are leasing a SUV with an MSRP of $50,000. You negotiate the price down to $47,000 and put $2,000 down.

Negotiated Price	$47,000
Residual Value (60%)	$30,000
Lease Term	36 Months
Money Factor	0.0015 (3.6% APR)

In this scenario, your monthly depreciation would be approximately $416.67 ($15,000 divided by 36 months), and your rent charge (interest) would be approximately $112.50, resulting in a base payment of $529.17 before taxes.

How to Lower Your Lease Payment

1. Negotiate the Sales Price: Just because it's a lease doesn't mean the price is fixed. Negotiate the "Gross Cap Cost" just as you would for a purchase.
2. Look for High Residual Values: Vehicles that hold their value well often have cheaper lease payments.
3. Verify the Money Factor: Dealerships sometimes "mark up" the money factor. Always ask for the "buy rate" based on your credit score.
4. Check for Rebates: Many manufacturers offer "Lease Cash" or specific incentives that can be applied to lower the capitalized cost.