GlenCalc

Lease calculator

A lease payment covers the car’s loss of value over the lease plus a finance charge set by the money factor. Enter the deal’s numbers to check a dealer’s quote.

The residual is a percentage of the MSRP.

Acquisition fee and others rolled in.

Money factor × 2400 ≈ APR. 0.0025 ≈ 6%.

Your answer

Monthly payment$554.84
Depreciation part$369.31
Finance part$149.24
Tax$36.30
Residual (buyout) value$23,200.00
Equivalent APR6 %
Total of payments$19,974.28

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How we worked it out

Updated as you change the numbers.

  1. Adjusted cap cost = $36,495.00. Residual = $40,000.00 × 58% = $23,200.00.
  2. Depreciation = ($36,495.00 − $23,200.00) ÷ 36 = $369.31.
  3. Finance charge = ($36,495.00 + $23,200.00) × 0.0025 = $149.24.
  4. Payment = $369.31 + $149.24 + tax $36.30 = $554.84.

Method and assumptions

This is the standard US lease formula. The depreciation part spreads the drop from the adjusted capitalized cost to the residual over the term. The finance part is (cap cost + residual) × money factor each month. Sales tax rules for leases vary by state; most tax the monthly payment.

Questions

How do I convert a money factor to an APR?

Multiply by 2,400. A money factor of 0.0025 is about 6% APR.

Sources

Method and figures checked on . Every worked answer on this page is covered by an automated test. Found a mistake? Tell us.

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