Car Lease vs. Buy Calculator
Compare the total cost of ownership to find the best financial move.
Buying / Financing
Leasing
Financial Summary
Total Buying Cost (Net)
Total Lease Cost
Lease vs. Buy: Which One Saves You More?
Deciding between leasing or buying a car is one of the most common financial dilemmas for drivers. While a lease often offers a lower monthly payment and the thrill of a new car every few years, buying a vehicle creates equity and eliminates payments once the loan is cleared.
Understanding the Costs of Buying
When you buy a car, you are financing the entire purchase price of the vehicle. Your monthly payments are determined by the loan amount, the interest rate, and the term length. The significant financial advantage of buying is the residual value—the amount you can sell the car for once you’re done with it. To find the “net cost,” we subtract the car’s future resale value from the total of all payments made.
The Reality of Leasing
Leasing is essentially renting the vehicle for its most expensive years of depreciation. You pay for the difference between the car’s current price and its estimated value at the end of the lease, plus “money factor” (interest) and fees. While the monthly cash flow is usually better, you walk away with zero equity at the end of the term.
Real-World Example Comparison
Let’s look at a $35,000 SUV:
- Buying: $5,000 down, 5.5% interest, 60-month loan. Monthly payment: ~$573. Total paid: $39,380. If you sell it after 5 years for $15,000, your Net Cost is $24,380.
- Leasing: $2,500 due at signing, $450/month for 36 months. Total paid over 3 years: $18,700. If you do this twice to cover the same 60-month period, your total cost would likely exceed the buying scenario significantly.
Pros and Cons
| Feature | Buying | Leasing |
|---|---|---|
| Ownership | You own it at the end. | You return it at the end. |
| Monthly Cost | Usually higher. | Usually lower. |
| Mileage | Unlimited. | Strict limits (e.g., 12k/year). |
| Customization | Modify as you wish. | Must remain factory-stock. |
function calculateLeaseVsBuy() {
// Buy Inputs
var buyPrice = parseFloat(document.getElementById(‘buyPrice’).value) || 0;
var buyDown = parseFloat(document.getElementById(‘buyDown’).value) || 0;
var buyTerm = parseFloat(document.getElementById(‘buyTerm’).value) || 0;
var buyRate = parseFloat(document.getElementById(‘buyRate’).value) || 0;
var buyResale = parseFloat(document.getElementById(‘buyResale’).value) || 0;
// Lease Inputs
var leaseMonthly = parseFloat(document.getElementById(‘leaseMonthly’).value) || 0;
var leaseDown = parseFloat(document.getElementById(‘leaseDown’).value) || 0;
var leaseTerm = parseFloat(document.getElementById(‘leaseTerm’).value) || 0;
var leaseFees = parseFloat(document.getElementById(‘leaseFees’).value) || 0;
// Buying Calculation
var loanAmount = buyPrice – buyDown;
var monthlyRate = (buyRate / 100) / 12;
var buyMonthlyPayment = 0;
if (monthlyRate > 0) {
buyMonthlyPayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, buyTerm)) / (Math.pow(1 + monthlyRate, buyTerm) – 1);
} else {
buyMonthlyPayment = buyTerm > 0 ? loanAmount / buyTerm : 0;
}
var totalPaidBuy = (buyMonthlyPayment * buyTerm) + buyDown;
var netBuyCost = totalPaidBuy – buyResale;
// Lease Calculation
var totalLeaseCost = (leaseMonthly * leaseTerm) + leaseDown + leaseFees;
// Display Results
document.getElementById(‘resultsArea’).style.display = ‘block’;
document.getElementById(‘buyResultTotal’).innerText = ‘$’ + netBuyCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById(‘leaseResultTotal’).innerText = ‘$’ + totalLeaseCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
var verdictDiv = document.getElementById(‘verdict’);
// Normalize to monthly cost for fair comparison since terms might differ
var monthlyBuyCost = netBuyCost / buyTerm;
var monthlyLeaseCost = totalLeaseCost / leaseTerm;
if (monthlyBuyCost < monthlyLeaseCost) {
verdictDiv.style.backgroundColor = '#e6ffed';
verdictDiv.style.color = '#22863a';
verdictDiv.innerHTML = 'Verdict: Buying is financially better! Based on effective monthly cost: Buy ($’ + monthlyBuyCost.toFixed(2) + ‘) vs Lease ($’ + monthlyLeaseCost.toFixed(2) + ‘)‘;
} else {
verdictDiv.style.backgroundColor = ‘#fff5f5’;
verdictDiv.style.color = ‘#cb2431’;
verdictDiv.innerHTML = ‘Verdict: Leasing is financially better! Based on effective monthly cost: Lease ($’ + monthlyLeaseCost.toFixed(2) + ‘) vs Buy ($’ + monthlyBuyCost.toFixed(2) + ‘)‘;
}
// Scroll to results
document.getElementById(‘resultsArea’).scrollIntoView({ behavior: ‘smooth’, block: ‘nearest’ });
}