Compare the total cost of ownership to decide which financing option saves you more.
Vehicle Details
Loan Option (Buying)
Lease Option
Resale Value
Metric
Buying (Loan)
Leasing
Monthly Payment
Total Interest/Rent Charge
Total Out-of-Pocket
Net Cost (After Resale/Return)
Should You Lease or Buy Your Next Car?
Deciding between leasing and buying a vehicle is more than just a monthly payment comparison; it's a long-term financial strategy. This Car Lease vs. Buy Calculator helps you see the "hidden" costs of both paths, including interest, depreciation, and the equity you build—or lose.
Understanding the Buying Math
When you buy a car using a loan, you are paying for the entire value of the vehicle plus interest. Once the loan is paid off, you own an asset. The true cost of buying is:
(Total Payments + Down Payment + Tax) – Resale Value at the end of the term.
Understanding the Lease Math
Leasing is essentially renting a car for its most expensive years. You only pay for the depreciation (the difference between the price and the residual value) plus a "money factor" (interest). While monthly payments are usually lower, you have no asset at the end of the term.
Key Terms to Know
Money Factor: The interest rate on a lease. Multiply it by 2400 to get the approximate APR.
Residual Value: What the leasing company thinks the car will be worth when your lease ends.
Depreciation: The loss in value over time. This is the biggest cost of car ownership.
Real-World Example
Imagine a $35,000 SUV.
Buying: With a 5% loan over 60 months, your payment might be $566. After 5 years, you own a car worth $12,000. Your net cost was roughly $27,000.
Leasing: A 36-month lease might cost only $400/month. However, after 3 years, you return the car and have $0. To compare fairly, you'd need to look at the cost over the same timeframe.
Use our calculator to plug in your specific dealership offers and find the most cost-effective route for your budget!
function calculateLeaseVsBuy() {
// Inputs
var price = parseFloat(document.getElementById('carPrice').value);
var down = parseFloat(document.getElementById('downPayment').value);
var tax = parseFloat(document.getElementById('salesTax').value) / 100;
// Loan Logic
var lTerm = parseFloat(document.getElementById('loanTerm').value);
var lRate = parseFloat(document.getElementById('loanRate').value) / 100 / 12;
var resale = parseFloat(document.getElementById('resaleValue').value);
// Lease Logic
var leaseTerm = parseFloat(document.getElementById('leaseTerm').value);
var moneyFactor = parseFloat(document.getElementById('moneyFactor').value);
var residual = parseFloat(document.getElementById('residualVal').value);
if (isNaN(price) || isNaN(down) || isNaN(lTerm)) {
alert("Please enter valid numbers");
return;
}
// — BUYING CALCULATION —
var loanAmount = (price * (1 + tax)) – down;
var buyMonthly = 0;
if (lRate > 0) {
buyMonthly = loanAmount * (lRate * Math.pow(1 + lRate, lTerm)) / (Math.pow(1 + lRate, lTerm) – 1);
} else {
buyMonthly = loanAmount / lTerm;
}
var totalBuyPayments = buyMonthly * lTerm;
var totalBuyInterest = totalBuyPayments – loanAmount;
var totalBuyOutPocket = totalBuyPayments + down;
var netBuyCost = totalBuyOutPocket – resale;
// — LEASING CALCULATION —
// Depreciation Fee = (Price – Residual) / Term
var depreciationFee = (price – residual) / leaseTerm;
// Finance Fee = (Price + Residual) * Money Factor
var financeFee = (price + residual) * moneyFactor;
var leaseMonthlyBase = depreciationFee + financeFee;
var leaseMonthly = leaseMonthlyBase * (1 + tax);
var totalLeasePayments = leaseMonthly * leaseTerm;
var totalRentCharge = financeFee * leaseTerm;
var totalLeaseOutPocket = totalLeasePayments + down;
var netLeaseCost = totalLeaseOutPocket; // No resale value to subtract
// Display Results
document.getElementById('calcResult').style.display = 'block';
document.getElementById('resBuyMonthly').innerHTML = '$' + buyMonthly.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resLeaseMonthly').innerHTML = '$' + leaseMonthly.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('resBuyInterest').innerHTML = '$' + totalBuyInterest.toLocaleString(undefined, {maximumFractionDigits: 0});
document.getElementById('resLeaseRent').innerHTML = '$' + totalRentCharge.toLocaleString(undefined, {maximumFractionDigits: 0});
document.getElementById('resBuyTotalOut').innerHTML = '$' + totalBuyOutPocket.toLocaleString(undefined, {maximumFractionDigits: 0});
document.getElementById('resLeaseTotalOut').innerHTML = '$' + totalLeaseOutPocket.toLocaleString(undefined, {maximumFractionDigits: 0});
document.getElementById('resBuyNet').innerHTML = '$' + netBuyCost.toLocaleString(undefined, {maximumFractionDigits: 0});
document.getElementById('resLeaseNet').innerHTML = '$' + netLeaseCost.toLocaleString(undefined, {maximumFractionDigits: 0});
var winnerBox = document.getElementById('winnerMessage');
// Normalize by month for comparison
var buyCostPerMonth = netBuyCost / lTerm;
var leaseCostPerMonth = netLeaseCost / leaseTerm;
if (buyCostPerMonth < leaseCostPerMonth) {
winnerBox.innerHTML = "🏆 Buying is more cost-effective long-term!";
winnerBox.style.backgroundColor = "#d4edda";
winnerBox.style.color = "#155724";
} else {
winnerBox.innerHTML = "🏆 Leasing is cheaper for this specific term!";
winnerBox.style.backgroundColor = "#fff3cd";
winnerBox.style.color = "#856404";
}
}