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Car Lease vs Buy Calculator
Compare leasing and buying a car with payments, fees, taxes, mileage costs, resale value, and remaining loan balance.
Vehicle details
Lease details
Buy details
Advanced assumptions
Shared assumptions
Lease details
Buy details
Cumulative net cost
Cost breakdown
Lease vs buy breakdown
Net cost over selected lease term| Detail | Lease | Buy |
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Interpret your lease vs buy estimate
The calculator compares estimated net cost over the selected lease term. Leasing is mostly a payment-and-fee decision. Buying adds resale value, remaining loan balance, and ownership equity, so the cheapest monthly payment is not always the cheapest path.
Inputs that matter most
- Money factor and residual value: these drive the calculated lease payment.
- Loan APR and term: these set the buy payment and remaining balance at the comparison date.
- Shared assumptions: sales tax, required fees, credits, and trade-in equity affect both options in this estimate.
- Resale value: buying looks better when the vehicle keeps more value than expected.
- Mileage and maintenance: these can swing the result when the lease has overage charges or one option has higher upkeep.
Common mistakes
- Comparing only monthly payments instead of total net cost.
- Treating total due at signing as the lease down payment when the first payment and fees are listed separately.
- Ignoring the value of the owned car at the end of the comparison period.
- Forgetting lease acquisition, disposition, and excess mileage charges.
- Using a resale estimate that is too optimistic for the vehicle and mileage.
- Mixing lease-only and buy-only costs in the shared assumptions.
When this estimate can be misleading
This estimate can be misleading if local lease tax rules, dealer fees, insurance costs, maintenance needs, end-of-lease wear charges, or actual resale value differ from the assumptions entered.
Scenarios to try
- Lower the resale value to test faster depreciation.
- Increase expected miles to see how sensitive the lease is to overage charges.
- Compare a 36-month lease against 60- and 72-month loans.
- Try a lower buy down payment to compare similar upfront cash.
Next-step utilities
How to use this car lease vs buy calculator
Enter the same vehicle price and general deal assumptions, then compare a lease against financing the car.
- Enter the negotiated vehicle price before taxes, fees, rebates, trade-in, and down payments.
- Choose the lease term. The calculator uses that term as the comparison horizon for both options.
- Enter lease assumptions including down payment, residual value, money factor, acquisition fee, disposition fee, mileage limits, and lease maintenance.
- Enter buy assumptions including down payment, APR, loan term, expected resale value, and buy maintenance.
- Review the lower estimated cost, monthly payments, cumulative cost chart, cost breakdown chart, and detailed comparison table.
- Change one assumption at a time, such as resale value or annual mileage, to see which parts of the deal drive the result.
What to gather from your lease and loan quotes
The calculator is most useful when the numbers come from actual quotes instead of guesses.
For the lease side, look for the negotiated price, lease term, residual value, money factor, acquisition fee, disposition fee, mileage allowance, excess-mile rate, and any cash due that is specifically reducing the capitalized cost. If the quote only shows a monthly payment, ask for the money factor and residual percentage so the comparison is not just reverse-engineering a payment.
For the buy side, collect the loan APR, loan term, down payment, taxes and required fees, rebates, trade-in equity, and a conservative resale estimate for the end of the lease-length period. A longer loan can look attractive month to month, but the remaining balance matters when you compare it against a lease over the same number of months.
Use Shared assumptions only for costs and credits that affect both choices. Put acquisition, disposition, mileage overage, and lease maintenance in Lease details, and put buy maintenance in Buy details.
Car Lease vs Buy Calculator features
- Compare leasing and buying over the same vehicle-use period.
- Estimate a lease payment from capitalized cost, residual value, money factor, and lease term.
- Include lease acquisition fee, disposition fee, cash down, rebates, trade equity, and excess mileage.
- Estimate buy-side loan payment from amount financed, APR, and loan term.
- Account for sales tax, title, registration, and dealer fees.
- Subtract projected vehicle equity from the buy-side net cost.
- Track remaining loan balance at the end of the lease-length comparison period.
- Include separate monthly maintenance and repair allowances for the lease and buy scenarios.
- Chart cumulative net cost month by month over the comparison period.
- Chart the major cost pieces that explain the lease and buy totals.
- Show a side-by-side breakdown of monthly payment, upfront cash, trade-in equity, end equity, and net cost.
What a lease vs buy comparison shows
Leasing and buying package vehicle costs in different ways, so the best comparison is the cost to use the same car for the same number of months.
A lease payment is built from depreciation, finance charge, and tax. The residual value is the estimated value of the car at the end of the lease. A higher residual usually lowers the lease payment because you are paying for less depreciation.
Buying usually has a higher monthly payment because the loan is paying down the full financed balance. But the buyer may still own meaningful equity at the end of the comparison period. This calculator subtracts the estimated resale value after paying off the remaining loan balance, so the buy result reflects the value left in the vehicle.
The result is a planning estimate, not a dealer quote. Lease programs can include taxes, fees, incentives, and lender rules that vary by state, manufacturer, dealer, and credit tier. Some leases also charge for excess wear, early termination, or purchase-option fees that are not modeled here. Use the calculator to understand the moving parts before comparing actual lease and loan offers.
Lease vs buy formulas
The calculator estimates monthly payments, cash paid, ending equity, and net cost over the selected lease term.
P = \frac{C - R}{n} + (C + R) \cdot M
C is adjusted capitalized cost, R is residual value, n is lease months, and M is the money factor.
B = L \cdot \frac{r(1+r)^n}{(1+r)^n - 1}
L is amount financed, r is monthly loan rate, and n is loan months.
N_L = D_L + E + P_L \cdot h + U_L \cdot h + F_R + M
D_L is lease down payment, E is trade-in equity used, P_L is monthly lease payment, h is lease months, U_L is lease monthly upkeep, F_R is disposition fee, and M is excess mileage cost.
N = D + E + P_m \cdot h + U \cdot h - (V - Q)
D is down payment, E is trade-in equity used, P_m is monthly loan payment, h is comparison months, U is buy-side monthly upkeep, V is resale value, and Q is remaining loan balance.
Car lease vs buy calculator FAQ
Is money factor the same as APR?
Not exactly. Money factor is the finance rate format commonly used in lease contracts. A rough APR equivalent is money factor multiplied by 2,400, so a 0.00250 money factor is roughly 6.0% APR.
Why does the buy option subtract equity?
If you buy, the car can still have resale value at the end of the lease-length period. The calculator subtracts estimated resale value after remaining loan payoff because that equity reduces the effective cost of buying.
Does this include insurance?
No. Insurance can vary by driver, state, lender, and vehicle. If one option requires meaningfully different coverage, add that difference to the relevant maintenance and repairs field or compare it separately.
Does this match every state lease tax rule?
No. The calculator applies sales tax to the monthly lease payment and to the buy-side taxable vehicle price. Some states tax leases or incentives differently, so use your lease worksheet or dealer quote for final contract numbers.
Why compare a lease to only the first part of a longer loan?
The lease term is the comparison horizon. If you compare a 36-month lease against a 60-month loan, the calculator counts 36 months of loan payments and subtracts estimated equity after the remaining loan balance.
Should shared taxes, fees, and credits always be identical for lease and buy?
Not always. This calculator uses shared assumptions to keep the comparison understandable. If your quotes show different taxes, fees, incentives, or trade treatment for lease and buy, use the closest comparable numbers or compare the dealer worksheets directly.
Does this include end-of-lease wear charges?
No. It includes disposition fee and excess mileage, but not wear-and-tear charges. If you expect turn-in damage charges, add a monthly estimate to lease maintenance or include that cost separately when reviewing the result.
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