Enter your vehicle price, down payment, residual value, lease term, and money factor to calculate your monthly lease payment and total cost over the lease term.
Vehicle & Cap Cost
$
$
Amount paid upfront to reduce the cap cost. Enter 0 if no down payment.
mo
Typical lease terms are 24, 36, or 48 months.
Residual Value
Residual input method
%
Percentage of vehicle price remaining at lease end. Set by the leasing company.
$
Money Factor / Finance Rate
Finance rate input method
Provided by the dealer or manufacturer. Multiply by 2,400 to estimate APR (e.g., 0.00125 ≈ 3%).
%
Converted to money factor automatically (APR ÷ 2,400).
Due at Signing
$
Includes first payment, acquisition fee, taxes, registration, and any cap cost reduction paid upfront. Enter 0 if unknown.
Lease Payment Breakdown
Adjusted cap cost—
Residual value—
Depreciation portion—
Finance charge portion—
Monthly lease payment—
Due at signing—
Total lease cost—
Monthly Payment
—
Total Lease Cost
—
Due at Signing
—
This calculation excludes taxes, mileage overage fees, wear-and-use charges, and dealer-specific fees. Pre-tax payment shown. Actual costs vary by state and dealer.
About the Auto Lease Calculator
Lease payments look nothing like loan payments — instead of amortizing a full purchase price, you pay only for the vehicle's depreciation during the lease term, plus a finance charge. Understanding how each piece of the formula works lets you evaluate any lease offer with confidence and negotiate the parts that actually affect your payment.
Auto Lease Payment Formula
Adjusted Cap Cost = Vehicle Price − Cap Cost Reduction
Depreciation/mo = (Adj. Cap Cost − Residual Value) ÷ Lease Term
Finance Charge/mo = (Adj. Cap Cost + Residual Value) × Money Factor
Monthly Payment = Depreciation/mo + Finance Charge/mo
Total Lease Cost = (Monthly Payment × Term) + Due at Signing
Money Factor vs. APR
To convert money factor to approximate APR: multiply by 2,400. A money factor of 0.00125 equals roughly 3% APR. To convert APR to money factor: divide by 2,400. Dealers sometimes quote money factor as "1.25" meaning 0.00125 — always confirm which format is being used before entering it here.
What You Can and Cannot Negotiate
Negotiable: Sale price (cap cost), cap cost reduction, acquisition fee (sometimes), dealer fees
Not negotiable: Residual value (set by manufacturer's finance arm), base money factor
Tip: Reducing the sale price by $1,000 saves roughly $1,000 ÷ Term each month. On a 36-month lease, a $3,000 price reduction saves $83/month.
Leasing vs. Buying
Leasing offers lower monthly payments and the ability to drive a newer vehicle more frequently. Buying builds equity and is cheaper over the long term if you keep the vehicle for many years. The total lease cost over 3 lease cycles (9 years) is typically significantly higher than buying and holding the same vehicle, because you are perpetually paying for depreciation and never own an asset.
This calculator provides pre-tax estimates only. Actual lease payments include state and local taxes, registration, documentation fees, and other charges. Not financial advice.
Money factor is a number used to calculate the finance portion of a lease payment, similar to an interest rate but expressed differently. It typically looks like 0.00100 to 0.00300. To convert money factor to an approximate APR, multiply by 2,400. A money factor of 0.00125 equals roughly 3% APR. Dealers sometimes quote money factor as a larger number (e.g., 1.25) — always confirm whether the quoted number needs to be divided by 1,000 before using it in calculations.
What is residual value in a lease?
Residual value is the vehicle's estimated worth at the end of the lease term, set by the leasing company at the start of the lease. It is expressed as a percentage of the MSRP (e.g., 55% residual on a $40,000 car = $22,000 residual). A higher residual value means less depreciation, which lowers your monthly payment. You do not pay the residual — it belongs to the leasing company unless you choose to buy the car at lease end.
What is capitalized cost reduction?
Capitalized cost reduction (cap cost reduction) is the upfront payment that reduces the amount being financed in the lease, similar to a down payment on a loan. It directly reduces your adjusted cap cost and thus lowers your monthly payment. However, unlike a loan down payment, a cap cost reduction on a lease is not recovered if the car is totaled or stolen early in the lease — a point worth considering when deciding how much to put down.
Is leasing cheaper than buying a car?
Monthly lease payments are typically lower than loan payments for the same vehicle because you are only paying for the depreciation during the lease term plus a finance charge — not the full purchase price. However, leasing costs more over time if you intend to drive the same vehicle long-term, because you never build equity. Leasing makes the most sense if you prefer lower monthly payments, enjoy driving newer vehicles, or drive fewer miles than the lease limit.
What is due at signing on a car lease?
Due at signing is the upfront amount paid when you start the lease, typically including the first month's payment, a security deposit, acquisition fee, destination charge, documentation fees, and any cap cost reduction (down payment). This calculator lets you enter the total due-at-signing amount to include it in your total lease cost calculation. Some dealers advertise 'zero due at signing' leases, which roll all upfront costs into the monthly payment, resulting in a higher monthly amount.
Can I negotiate a car lease?
Yes — and you should. The vehicle sale price (cap cost), money factor, and acquisition fee are all potentially negotiable. The residual value is set by the manufacturer's finance arm and is not negotiable. Negotiating the sale price lower directly reduces your monthly payment by reducing the cap cost. You can also ask the dealer for the current money factor on a given model — if they refuse to share it, research it through automotive lease resources.
