Monthly Compound Interest Calculator

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Car Lease Payment Calculator

24 Months 36 Months 48 Months 60 Months
(APR รท 2400 = Money Factor)

Estimated Monthly Payment

$0.00
Total Depreciation:
Total Rent Charge:
Residual Value ($):
Total Cost of Lease:

Understanding Your Car Lease Calculation

Leasing a vehicle is often more complex than a traditional car loan because you are essentially paying for the depreciation of the car over a fixed period, rather than the entire value of the vehicle. This car lease calculator helps you break down the components that determine your monthly payment.

1. Capitalized Cost (The Selling Price)

The "Negotiated Price" or Gross Capitalized Cost is the starting point. Just like buying a car, you should always negotiate the price of the vehicle before discussing lease terms. A lower sales price directly results in a lower monthly payment.

2. Residual Value

The residual value is what the leasing company estimates the car will be worth at the end of your lease. It is expressed as a percentage of the MSRP. For example, if a $40,000 car has a 60% residual value after 36 months, it is predicted to be worth $24,000. In a lease, you only pay for the $16,000 difference (plus interest and taxes).

3. The Money Factor

The Money Factor represents the interest rate on a lease. Unlike a traditional APR, it is expressed as a small decimal. To convert APR to a Money Factor, divide the APR by 2400. For instance, a 3% APR is a 0.00125 money factor. A lower money factor means lower "Rent Charges."

Example Lease Calculation

  • MSRP: $40,000
  • Sales Price: $38,000
  • Term: 36 Months
  • Residual: 55% ($22,000)
  • Money Factor: 0.0015
  • Depreciation Fee: ($38,000 – $22,000) / 36 = $444.44
  • Finance Fee: ($38,000 + $22,000) * 0.0015 = $90.00
  • Base Payment: $534.44 + Tax

Frequently Asked Questions

Should I put money down on a lease?
Generally, experts recommend putting as little money down as possible ($0 down is ideal). If the leased car is totaled or stolen shortly after you drive it off the lot, your down payment is usually lost, even if insurance covers the value of the car.

How can I lower my lease payment?
Focus on three things: Negotiating a lower sales price, finding cars with high residual values, and qualifying for the lowest possible money factor based on your credit score.

function calculateLeasePayment() { var msrp = parseFloat(document.getElementById('msrp').value); var salesPrice = parseFloat(document.getElementById('salesPrice').value); var downPayment = parseFloat(document.getElementById('downPayment').value) || 0; var tradeIn = parseFloat(document.getElementById('tradeIn').value) || 0; var term = parseInt(document.getElementById('leaseTerm').value); var moneyFactor = parseFloat(document.getElementById('moneyFactor').value); var residualPercent = parseFloat(document.getElementById('residualPercent').value); var taxRate = parseFloat(document.getElementById('salesTax').value) || 0; if (isNaN(msrp) || isNaN(salesPrice) || isNaN(moneyFactor) || isNaN(residualPercent)) { alert("Please enter all required fields with valid numbers."); return; } // 1. Calculate Residual Value in Dollars var residualValue = msrp * (residualPercent / 100); // 2. Calculate Adjusted Capitalized Cost var adjCapCost = salesPrice – downPayment – tradeIn; // 3. Monthly Depreciation Fee var monthlyDepreciation = (adjCapCost – residualValue) / term; // Check if depreciation is negative (rare, but means price is lower than residual) if (monthlyDepreciation < 0) monthlyDepreciation = 0; // 4. Monthly Rent Charge (Interest) // Formula: (Adj Cap Cost + Residual Value) * Money Factor var monthlyRentCharge = (adjCapCost + residualValue) * moneyFactor; // 5. Subtotal and Tax var basePayment = monthlyDepreciation + monthlyRentCharge; var monthlyTax = basePayment * (taxRate / 100); var totalMonthlyPayment = basePayment + monthlyTax; // 6. Totals var totalCostOfLease = (totalMonthlyPayment * term) + downPayment + tradeIn; var totalRentTotal = monthlyRentCharge * term; var totalDepreciationTotal = monthlyDepreciation * term; // Display Results document.getElementById('result-area').style.display = 'block'; document.getElementById('monthly-payment').innerText = '$' + totalMonthlyPayment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res-depreciation').innerText = '$' + totalDepreciationTotal.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res-interest').innerText = '$' + totalRentTotal.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res-dollar').innerText = '$' + residualValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res-total').innerText = '$' + totalCostOfLease.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); // Smooth scroll to results document.getElementById('result-area').scrollIntoView({ behavior: 'smooth', block: 'nearest' }); }

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