Professional Car Lease Calculator
Calculate your estimated monthly lease payment based on MSRP, residual value, and money factor.
Estimated Monthly Payment
$0.00
Depreciation:
$0.00
$0.00
Rent Charge:
$0.00
$0.00
Monthly Tax:
$0.00
$0.00
Understanding How Car Lease Payments Work
Leasing a car is different from buying because you are essentially paying for the depreciation of the vehicle during the period you drive it, rather than the entire value of the car. To get the most out of this calculator, you need to understand the three primary components of a lease payment.
1. Monthly Depreciation
This is the largest part of your payment. It is calculated by taking the "Adjusted Capitalized Cost" (the price you negotiated minus your down payment) and subtracting the "Residual Value" (what the car is worth at the end of the lease), then dividing that number by the number of months in the lease.
2. The Rent Charge (Money Factor)
The rent charge is the cost of borrowing the money from the leasing company. In lease contracts, this is often expressed as a Money Factor (a small decimal like 0.00125). To convert a Money Factor to a traditional APR, multiply it by 2400. Conversely, if you only know the APR, divide it by 2400 to get the Money Factor for this calculator.
3. Sales Tax
Unlike a car purchase where you often pay tax on the full price upfront, most states only charge sales tax on the monthly lease payment. Our calculator applies the tax rate to the sum of the depreciation and rent charges.
Real-World Example:
Suppose you lease a car with an MSRP of $40,000 but negotiate the price to $38,000. You put $2,000 down. The 36-month residual is 60% ($24,000). Your Money Factor is 0.0015 (3.6% APR).
– Capitalized Cost: $36,000
– Depreciation: ($36,000 – $24,000) / 36 = $333.33/mo
– Rent Charge: ($36,000 + $24,000) * 0.0015 = $90.00/mo
– Total (Before Tax): $423.33/mo
Suppose you lease a car with an MSRP of $40,000 but negotiate the price to $38,000. You put $2,000 down. The 36-month residual is 60% ($24,000). Your Money Factor is 0.0015 (3.6% APR).
– Capitalized Cost: $36,000
– Depreciation: ($36,000 – $24,000) / 36 = $333.33/mo
– Rent Charge: ($36,000 + $24,000) * 0.0015 = $90.00/mo
– Total (Before Tax): $423.33/mo
Tips for Lowering Your Lease Payment
- Negotiate the Gross Cap Cost: Many people don't realize that the "selling price" of a leased car is negotiable just like a purchase.
- Check for Rebates: Look for "Lease Cash" or manufacturer incentives that can be used as a down payment.
- Watch the Mileage: Higher mileage limits (e.g., 15,000 miles/year) lower the residual value, which increases your monthly payment.