Professional Car Lease Calculator
Calculate your precise monthly lease payment including depreciation and rent charges.
Monthly Depreciation:
$0.00
Monthly Rent Charge:
$0.00
Base Monthly Payment:
$0.00
Total Monthly Payment:
$0.00
How Car Lease Payments are Calculated
Unlike a traditional auto loan, a car lease payment is primarily based on the vehicle's depreciation during the time you drive it, rather than its full purchase price. There are three core components to every lease payment:
- Depreciation Fee: This covers the loss in value the car experiences. It is calculated as: (Adjusted Capitalized Cost – Residual Value) ÷ Term.
- Rent Charge: This is essentially the interest you pay for the leasing company's capital. It is calculated as: (Adjusted Capitalized Cost + Residual Value) × Money Factor.
- Sales Tax: Most states apply sales tax to the monthly payment rather than the total value of the vehicle.
Understanding the Key Terms
MSRP: The Manufacturer's Suggested Retail Price. You should always try to negotiate the "Capitalized Cost" below this number.
Residual Value: This is the estimated value of the car at the end of the lease. A higher residual value usually results in a lower monthly payment because you are responsible for less depreciation.
Money Factor: This is the interest rate expressed in a different format. To convert the Money Factor to a standard APR, multiply it by 2,400. For example, a money factor of 0.0015 is equivalent to a 3.6% APR.
Example Calculation
If you lease a car with an MSRP of $40,000, a residual of 60% ($24,000), for 36 months, with a $2,000 down payment:
- Adjusted Cap Cost: $40,000 – $2,000 = $38,000
- Monthly Depreciation: ($38,000 – $24,000) / 36 = $388.89
- Rent Charge (assuming 0.00125 MF): ($38,000 + $24,000) * 0.00125 = $77.50
- Base Payment: $388.89 + $77.50 = $466.39