Estimate your monthly lease payment based on MSRP, money factor, and residual value.
Gross Capitalized Cost:$0.00
Residual Value:$0.00
Monthly Depreciation:$0.00
Monthly Finance Fee:$0.00
Base Monthly Payment:$0.00
Total Monthly Payment (Inc. Tax):$0.00
function calculateCarLease() {
var msrp = parseFloat(document.getElementById('msrp').value);
var salesPrice = parseFloat(document.getElementById('salesPrice').value);
var downPayment = parseFloat(document.getElementById('downPayment').value);
var tradeIn = parseFloat(document.getElementById('tradeIn').value);
var leaseTerm = parseFloat(document.getElementById('leaseTerm').value);
var residualPercent = parseFloat(document.getElementById('residualPercent').value);
var moneyFactor = parseFloat(document.getElementById('moneyFactor').value);
var taxRate = parseFloat(document.getElementById('taxRate').value);
if (isNaN(msrp) || isNaN(salesPrice) || isNaN(leaseTerm) || leaseTerm <= 0) {
alert("Please enter valid numbers for price and term.");
return;
}
// 1. Calculate Net Capitalized Cost
var netCapCost = salesPrice – downPayment – tradeIn;
// 2. Calculate Residual Value
var residualValue = msrp * (residualPercent / 100);
// 3. Monthly Depreciation Fee
// (Net Cap Cost – Residual Value) / Term
var monthlyDepreciation = (netCapCost – residualValue) / leaseTerm;
if (monthlyDepreciation < 0) monthlyDepreciation = 0;
// 4. Monthly Finance Fee (Rent Charge)
// (Net Cap Cost + Residual Value) * Money Factor
var monthlyFinance = (netCapCost + residualValue) * moneyFactor;
// 5. Base Monthly Payment
var basePayment = monthlyDepreciation + monthlyFinance;
// 6. Total Payment with Tax
var totalPayment = basePayment * (1 + (taxRate / 100));
// Display Results
document.getElementById('resGrossCap').innerText = "$" + netCapCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resResidualVal').innerText = "$" + residualValue.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resDepreciation').innerText = "$" + monthlyDepreciation.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resFinance').innerText = "$" + monthlyFinance.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resBasePayment').innerText = "$" + basePayment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resTotalPayment').innerText = "$" + totalPayment.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('leaseResults').style.display = 'block';
}
Understanding the Car Lease Calculation
Leasing a vehicle is often more complex than a traditional auto loan. While a loan is based on the total price of the car, a lease is essentially paying for the depreciation of the vehicle during the time you drive it, plus interest and taxes.
Key Terms in Your Lease Agreement
Gross Capitalized Cost: This is the negotiated price of the vehicle plus any additional fees or prior loan balances.
Residual Value: This is the estimated value of the car at the end of the lease term. It is usually set by the bank and is expressed as a percentage of the original MSRP. A higher residual value results in a lower monthly payment.
Money Factor: This represents the interest rate on your lease. To convert a money factor to a standard APR, multiply it by 2400. For example, a money factor of 0.00125 is equivalent to a 3% APR.
Cap Cost Reductions: Any down payment, trade-in credit, or manufacturer rebates that reduce the amount being financed.
The Lease Formula Explained
Your monthly payment is comprised of three main parts:
Depreciation Fee: (Net Capitalized Cost – Residual Value) ÷ Lease Term. You are paying for the portion of the car's value that "disappears" while you own it.
Finance Fee (Rent Charge): (Net Capitalized Cost + Residual Value) × Money Factor. This is the cost of borrowing the money to hold the asset.
Sales Tax: Most states apply sales tax to the monthly payment, rather than the total value of the car.
Example Lease Calculation
Suppose you want to lease a SUV with an MSRP of $50,000. You negotiate the Sales Price to $47,000. You put $2,000 down. The bank sets the Residual Value at 60% ($30,000) for a 36-month term with a Money Factor of 0.0020.
To get the best deal, focus on negotiating the Gross Capitalized Cost just as you would when buying a car. Avoid putting large down payments (Cap Cost Reductions) on leases; if the car is totaled or stolen shortly after leaving the lot, that down payment is often lost. Instead, look for vehicles with high residual values and low money factors (promotional rates) to minimize your out-of-pocket monthly costs.