Lease Calculator
Calculate your monthly lease payment based on asset value, residual value, lease term, and interest rate. Compare lease options and understand the total cost of leasing.
Lease Payment: $0.00
| Asset Value | $0.00 |
|---|---|
| Residual Value | $0.00 |
| Depreciation Amount | $0.00 |
| Lease Term | 0 months |
| Interest Rate | 0% |
| Money Factor | 0.0000 |
| Total Lease Cost | $0.00 |
Interest Rate: 0%
| Asset Value | $0.00 |
|---|---|
| Residual Value | $0.00 |
| Depreciation Amount | $0.00 |
| Lease Term | 0 months |
| Monthly Payment | $0.00 |
| Total Lease Cost | $0.00 |
About Lease Calculator
A lease calculator helps you determine your monthly lease payments and understand the total cost of leasing an asset (typically a vehicle). The calculation takes into account the asset's value, its residual value at the end of the lease, the lease term, and the interest rate (or money factor).
How Lease Payments Are Calculated
Lease payments consist of two main components:
- Depreciation Fee: This covers the asset's loss in value during the lease term. It's calculated as (Asset Value - Residual Value) / Lease Term.
- Finance Fee: This is the interest charged on the lease. It's calculated as (Asset Value + Residual Value) × Money Factor.
The monthly lease payment is the sum of these two fees.
Fixed Rate vs. Fixed Pay
This calculator offers two calculation methods:
- Fixed Rate: Calculate your monthly payment based on a known interest rate.
- Fixed Pay: Determine the implied interest rate based on a known monthly payment amount.
Understanding Money Factor
The money factor is another way to express the interest rate on a lease. It's essentially the interest rate divided by 2400. For example, a 6% interest rate would be equivalent to a money factor of 0.0025 (6 ÷ 2400).
Lease vs. Buy Considerations
When deciding whether to lease or buy an asset, consider:
- Monthly Payments: Lease payments are typically lower than loan payments for the same asset.
- Ownership: With a lease, you don't own the asset at the end of the term unless you choose to buy it.
- Mileage Limits: Leases often have mileage restrictions with penalties for exceeding them.
- Customization: Leased assets typically can't be modified.
- Long-term Cost: While leasing may have lower monthly payments, buying may be cheaper in the long run.