Choosing between leasing and buying a car is a significant financial decision. Each option has its own set of costs, benefits, and implications that can impact your budget and driving experience. This calculator helps you compare the estimated total costs of leasing a vehicle versus purchasing it outright or through financing.
How the Calculator Works:
The calculator estimates the total cost of each option over a comparable timeframe, considering various financial factors.
Cost to Buy Calculation:
This section estimates the total financial outlay if you purchase the vehicle.
Vehicle Purchase Price: The initial sticker price of the car.
Down Payment (for Buying): The upfront cash you pay towards the purchase.
Loan Amount: Vehicle Purchase Price – Down Payment.
Monthly Loan Payment: Calculated using the standard auto loan amortization formula:
$M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]$, where:
$n$ = Total Number of Payments (Loan Term in Months)
Total Loan Payments: Monthly Loan Payment * Loan Term (Months).
Total Interest Paid: Total Loan Payments – Loan Amount.
Total Cost to Buy: Vehicle Purchase Price + Total Interest Paid. (Note: We are simplifying by not subtracting the eventual resale value here to directly compare cash outlays over the defined term. A more complex model could factor in resale value).
Cost to Lease Calculation:
This section estimates the total financial commitment for leasing the vehicle for a specific term.
Monthly Lease Payment: The recurring payment you make to the leasing company.
Total Lease Payments: Monthly Lease Payment * Lease Term (Months).
Mileage Penalty: Calculated as (Estimated Annual Mileage / 12 * Lease Term Months) – (Annual Lease Limit * Lease Term Months / 12) * Mileage Penalty Per Mile, if the total estimated mileage exceeds the lease mileage allowance. For simplicity, this calculator assumes a standard annual mileage limit for calculation, but the primary penalty is calculated on total expected mileage over the lease term exceeding the lease allowance. A simplified approach here compares the expected cost if you exceed a typical allowance. A more accurate calculation would need the specific lease mileage allowance. For this calculator, we'll compare the cost of the lease payments plus fees, and an estimate for potential over-mileage costs based on the input penalty. The primary comparison is total cash out for the lease term.
Lease Fees: One-time fees like acquisition and disposition fees.
Total Cost to Lease: Total Lease Payments + Lease Fees + Estimated Mileage Penalty Cost.
Important Considerations:
Resale Value: Buying often results in owning an asset with resale value. Leasing typically means you don't own the car at the end.
Mileage Limits: Leases have strict mileage limits. Exceeding them incurs significant penalties.
Wear and Tear: Leases penalize excessive wear and tear beyond normal use.
Customization: You generally cannot modify leased vehicles.
Flexibility: Leasing offers lower monthly payments and the ability to drive a new car every few years. Buying provides long-term ownership and no mileage restrictions.
Buyout Option: Some leases allow you to purchase the car at the end of the term for a predetermined price. This calculator includes inputs for potential buyout costs vs. estimated market value.
This calculator provides an estimate. Actual costs may vary based on specific dealer offers, financing terms, insurance, maintenance, and wear and tear charges.
function calculateLeaseVsBuy() {
// Get input values
var vehiclePrice = parseFloat(document.getElementById("vehiclePrice").value);
var downPaymentBuy = parseFloat(document.getElementById("downPaymentBuy").value);
var loanTermMonths = parseInt(document.getElementById("loanTermMonths").value);
var annualInterestRateBuy = parseFloat(document.getElementById("annualInterestRateBuy").value);
var estimatedAnnualMileage = parseFloat(document.getElementById("estimatedAnnualMileage").value);
var leaseTermMonths = parseInt(document.getElementById("leaseTermMonths").value);
var monthlyLeasePayment = parseFloat(document.getElementById("monthlyLeasePayment").value);
var leaseResidualValuePercent = parseFloat(document.getElementById("leaseResidualValue").value);
var leaseFees = parseFloat(document.getElementById("leaseFees").value);
var mileagePenaltyPerMile = parseFloat(document.getElementById("mileagePenaltyPerMile").value);
var purchaseOptionPrice = parseFloat(document.getElementById("purchaseOptionPrice").value);
var buyoutOptionFee = parseFloat(document.getElementById("buyoutOptionFee").value);
var expectedResaleValueAtBuyout = parseFloat(document.getElementById("expectedResaleValueAtBuyout").value);
// — Input Validation —
if (isNaN(vehiclePrice) || vehiclePrice <= 0 ||
isNaN(downPaymentBuy) || downPaymentBuy < 0 ||
isNaN(loanTermMonths) || loanTermMonths <= 0 ||
isNaN(annualInterestRateBuy) || annualInterestRateBuy < 0 ||
isNaN(estimatedAnnualMileage) || estimatedAnnualMileage < 0 ||
isNaN(leaseTermMonths) || leaseTermMonths <= 0 ||
isNaN(monthlyLeasePayment) || monthlyLeasePayment <= 0 ||
isNaN(leaseResidualValuePercent) || leaseResidualValuePercent 100 ||
isNaN(leaseFees) || leaseFees < 0 ||
isNaN(mileagePenaltyPerMile) || mileagePenaltyPerMile < 0 ||
isNaN(purchaseOptionPrice) || purchaseOptionPrice < 0 ||
isNaN(buyoutOptionFee) || buyoutOptionFee < 0 ||
isNaN(expectedResaleValueAtBuyout) || expectedResaleValueAtBuyout vehiclePrice) {
document.getElementById("buyCostDisplay").textContent = "Buy Total Cost: Invalid Input";
document.getElementById("leaseCostDisplay").textContent = "Lease Total Cost: Invalid Input";
document.getElementById("betterOptionDisplay").textContent = "Down payment cannot exceed vehicle price.";
return;
}
// — Calculate Cost to Buy —
var loanAmount = vehiclePrice – downPaymentBuy;
var monthlyInterestRateBuy = (annualInterestRateBuy / 100) / 12;
var totalLoanPayments = 0;
var totalInterestPaid = 0;
if (loanAmount > 0 && monthlyInterestRateBuy > 0 && loanTermMonths > 0) {
// Mortgage payment formula for loan
var monthlyPaymentBuy = loanAmount * (monthlyInterestRateBuy * Math.pow(1 + monthlyInterestRateBuy, loanTermMonths)) / (Math.pow(1 + monthlyInterestRateBuy, loanTermMonths) – 1);
totalLoanPayments = monthlyPaymentBuy * loanTermMonths;
totalInterestPaid = totalLoanPayments – loanAmount;
} else if (loanAmount > 0 && monthlyInterestRateBuy === 0) {
// Simple division if interest rate is 0
totalLoanPayments = loanAmount;
totalInterestPaid = 0;
} else {
// If no loan is needed (down payment covers full price)
totalLoanPayments = 0;
totalInterestPaid = 0;
}
var totalCostToBuy = vehiclePrice + totalInterestPaid;
// — Calculate Cost to Lease —
var totalLeasePayments = monthlyLeasePayment * leaseTermMonths;
var leaseAnnualMileageAllowance = (estimatedAnnualMileage / leaseTermMonths) * leaseTermMonths; // Assuming lease allowance is based on estimated annual mileage for comparison logic
var leaseMileageAllowanceTotal = (estimatedAnnualMileage / 12) * leaseTermMonths; // Total miles allowed based on monthly estimate * lease term
var actualMileageDriven = (estimatedAnnualMileage / 12) * leaseTermMonths;
var mileageOverage = Math.max(0, actualMileageDriven – leaseMileageAllowanceTotal);
var estimatedMileagePenaltyCost = mileageOverage * mileagePenaltyPerMile;
var totalCostToLease = totalLeasePayments + leaseFees + estimatedMileagePenaltyCost;
// — Comparison Logic —
var betterOptionMessage = "";
var buyCostDisplay = "Buy Total Cost: $" + totalCostToBuy.toFixed(2);
var leaseCostDisplay = "Lease Total Cost: $" + totalCostToLease.toFixed(2);
if (totalCostToBuy 0 && buyoutOptionFee > 0) {
var leaseWithBuyoutCost = totalCostToLease + purchaseOptionPrice + buyoutOptionFee;
leaseCostDisplay = "Lease + Buyout Cost: $" + leaseWithBuyoutCost.toFixed(2);
if (totalCostToBuy < leaseWithBuyoutCost) {
betterOptionMessage = "Buying appears more cost-effective. Lease with buyout is $" + (leaseWithBuyoutCost – totalCostToBuy).toFixed(2) + " more expensive.";
} else {
betterOptionMessage = "Leasing with buyout appears more cost-effective. Buying is $" + (totalCostToBuy – leaseWithBuyoutCost).toFixed(2) + " more expensive.";
}
}
} else if (totalCostToLease 0 && buyoutOptionFee > 0) {
var leaseWithBuyoutCost = totalCostToLease + purchaseOptionPrice + buyoutOptionFee;
leaseCostDisplay = "Lease + Buyout Cost: $" + leaseWithBuyoutCost.toFixed(2);
if (leaseWithBuyoutCost 0 && buyoutOptionFee > 0) {
var leaseWithBuyoutCost = totalCostToLease + purchaseOptionPrice + buyoutOptionFee;
leaseCostDisplay = "Lease + Buyout Cost: $" + leaseWithBuyoutCost.toFixed(2);
if(leaseWithBuyoutCost < totalCostToBuy) {
betterOptionMessage = "Leasing with buyout appears slightly more cost-effective.";
} else if (totalCostToBuy < leaseWithBuyoutCost) {
betterOptionMessage = "Buying appears slightly more cost-effective.";
} else {
betterOptionMessage = "The costs for leasing and buying (with buyout consideration) are approximately equal.";
}
}
}
// — Display Results —
document.getElementById("buyCostDisplay").textContent = buyCostDisplay;
document.getElementById("leaseCostDisplay").textContent = leaseCostDisplay;
document.getElementById("betterOptionDisplay").textContent = betterOptionMessage;
}