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 term = parseFloat(document.getElementById('leaseTerm').value) || 36;
var residualPct = parseFloat(document.getElementById('residualPercent').value) || 0;
var mf = parseFloat(document.getElementById('moneyFactor').value) || 0;
var tax = parseFloat(document.getElementById('salesTax').value) || 0;
if (msrp <= 0 || salesPrice <= 0 || residualPct <= 0) {
alert("Please enter valid figures for MSRP, Sales Price, and Residual Percentage.");
return;
}
// 1. Calculate Net Capitalized Cost
var netCapCost = salesPrice – downPayment – tradeIn;
// 2. Calculate Residual Value
var residualValue = msrp * (residualPct / 100);
// 3. Depreciation Fee = (Net Cap Cost – Residual Value) / Term
var depreciationFee = (netCapCost – residualValue) / term;
// 4. Finance Fee (Rent Charge) = (Net Cap Cost + Residual Value) * Money Factor
var financeFee = (netCapCost + residualValue) * mf;
// 5. Base Payment
var basePayment = depreciationFee + financeFee;
// 6. Total Payment with Tax
var totalPayment = basePayment * (1 + (tax / 100));
// Display Results
document.getElementById('leaseResult').style.display = 'block';
document.getElementById('monthlyPaymentOutput').innerText = '$' + totalPayment.toFixed(2);
document.getElementById('depreciationOutput').innerText = '$' + depreciationFee.toFixed(2);
document.getElementById('financeOutput').innerText = '$' + financeFee.toFixed(2);
document.getElementById('residualValueOutput').innerText = '$' + residualValue.toFixed(2);
document.getElementById('capCostOutput').innerText = '$' + netCapCost.toFixed(2);
}
How to Use the Car Lease Payment Calculator
Calculating a car lease is more complex than a standard loan because you aren't paying for the entire vehicle; you are paying for the depreciation of the car over the time you drive it, plus interest and taxes. This calculator breaks down the "hidden" math used by dealerships to help you negotiate a better deal.
Key Lease Terms Explained
MSRP: The Manufacturer's Suggested Retail Price (sticker price). This is the basis for the residual value.
Gross Capitalized Cost: The negotiated price of the vehicle before any down payments. Never assume the MSRP is the final price; always negotiate this number down.
Residual Value: The estimated value of the car at the end of the lease. This is set by the bank. A higher residual value means lower monthly payments.
Money Factor: This is the interest rate expressed as a decimal. To convert the Money Factor to a standard APR, multiply it by 2400. For example, 0.00125 x 2400 = 3% APR.
Capitalized Cost Reduction: Anything that lowers the Net Cap Cost, such as your down payment, trade-in, or manufacturer rebates.
The Formula Behind the Math
Your lease payment consists of two main parts:
Depreciation Fee: (Net Cap Cost – Residual Value) ÷ Term
The sum of these two figures is your base monthly payment. Finally, local sales tax is applied to that base payment to arrive at your total monthly out-of-pocket cost.
Example Lease Calculation
Imagine you are leasing a car with an MSRP of $40,000 but you negotiate the price down to $37,000. You put $2,000 down, leaving a Net Cap Cost of $35,000. If the residual value is 60% ($24,000) for 36 months and the Money Factor is 0.0015:
Depreciation: ($35,000 – $24,000) / 36 = $305.56
Finance: ($35,000 + $24,000) * 0.0015 = $88.50
Base Payment: $305.56 + $88.50 = $394.06
By using this calculator, you can enter different scenarios to see how a higher residual value or a lower money factor significantly impacts your monthly budget.