Lease Calculator - Monthly Payments & Total Cost

Estimate a monthly lease payment from asset value, residual value, term, financing rate, and tax.

Enter the asset value, lease term, monthly interest rate, down payment, residual value, and tax rate.

Estimate a monthly lease payment from asset value, residual value, term, financing rate, and tax.

Asset Value

Lease Term (Months)

Monthly Interest Rate (%)

Down Payment

Residual Value

Tax Rate (%)

About Monthly Lease Payments and Total Lease Cost

A closed-end lease payment has two economic pieces: you pay for the value the asset is expected to lose during the term, and you pay a finance charge on the money tied up in the asset. Sales tax may apply to the payment. The lease calculator makes those pieces visible so a car, equipment, or device quote is easier to compare with buying. Net capitalized cost is asset value minus down payment. Monthly depreciation is (net capitalized cost − residual value) ÷ term in months. Monthly finance charge is (net capitalized cost + residual value) × monthly interest rate. The pretax payment is depreciation plus finance charge. The quoted payment multiplies that sum by (1 + tax rate). Total lease cost is payment × term plus the down payment. A $50,000 asset, 36 months, 0.5% monthly rate, $5,000 down, $20,000 residual, and 8.5% tax produces about $1,106.10 per month. A $30,000 asset, 24 months, 0.4% monthly rate, $3,000 down, $15,000 residual, and 7% tax is about $714.76. With tax set to zero, a $60,000 asset, 48 months, 0.3% monthly rate, $6,000 down, and $24,000 residual pays $859.00. The monthly rate field is a percent per month, not an APR and not a dealer money factor. A 6% APR is roughly a 0.25% money factor on many auto quotes (APR ÷ 2400), which is not the same as entering 0.5. This educational identity uses (net cap + residual) × monthly rate without the extra division by two that money-factor quotes embed. Acquisition fees, disposition fees, mileage penalties, and residual guarantees are omitted. Use the lease calculator to unpack a payment, then match the rate convention on the contract before you sign. Mileage caps, wear standards, and purchase-option prices change the real cost of leasing versus buying even when the monthly payment is attractive. Recompute total lease cost after you add those contractual extras rather than treating the payment as the all-in price.

Lease Calculator Worked Examples

Use these worked scenarios to check inputs and understand how the estimate responds.

Inputs	Result	Interpretation
$50,000 asset, 36 months, 0.5% monthly rate, $5,000 down, $20,000 residual, 8.5% tax	About $1,106.10 monthly	The monthly charge includes both depreciation, finance, and tax.
$30,000 asset, 24 months, 0.4% monthly rate, $3,000 down, $15,000 residual, 7% tax	About $714.76 monthly	A higher residual value reduces the depreciation portion.
$60,000 asset, 48 months, 0.3% monthly rate, $6,000 down, $24,000 residual, 0% tax	About $859.00 monthly	Tax is optional and can be set to zero.

How to Calculate a Monthly Lease Payment

Enter asset value, term in months, monthly interest rate as a percent, down payment, residual value, and tax rate.
Use 0 for tax if the quote is pretax, and keep residual on the same currency basis as the asset.
Select Calculate to see the monthly payment, depreciation charge, finance charge, and total lease cost.
Raise residual value or down payment and recalculate to see how each one reduces the monthly payment.

Lease Calculator FAQ

Is the interest field an APR or a money factor?

It is a monthly interest rate in percent. Enter 0.5 for one-half percent per month. Dealer money factors are usually APR ÷ 2400 and are not interchangeable with this field unless you convert.

How is the monthly lease payment built?

Depreciation is (net cap − residual) ÷ months. Finance charge is (net cap + residual) × monthly rate. The payment adds those pieces and applies sales tax.

What is residual value?

Residual is the contracted value of the asset at lease end. A higher residual reduces depreciation and usually lowers the payment, but it can raise a purchase-option price if you buy the asset later.

Does total lease cost include the down payment?

Yes. Total lease cost is the stream of monthly payments plus the down payment. It still excludes mileage overage, wear charges, and end-of-lease fees.

Why is this payment different from a dealer worksheet?

Dealers often use a money factor, cap-cost reductions besides cash down, multiple tax bases, and fees. If the rate convention differs, the finance charge will not match even when residual and term do.

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