Auto Lease vs Loan Calculator | Compare Car Payments
Auto Lease vs Loan Calculator
Auto Lease Payment Schedule:
Auto Loan Payment Schedule (For Comparison)
How Monthly Lease Payments Are Calculated
Example Calculation
Input Values:
- Auto Price: $50,000
- Lease Term: 36 months
- Interest Rate: 5%
- Down Payment: $10,000
- Trade Allowance: $2,000
- Sales Tax: 7%
- Residual Value: $24,000
Monthly Lease Payment: $554.32
Formula: Monthly Depreciation + Monthly Interest + Monthly Tax
1. Monthly Depreciation: $388.89
Formula: (Auto Price - Down Payment - Trade Allowance - Residual Value) ÷ Lease Term
Calculation: (50,000 - 10,000 - 2,000 - 24,000) ÷ 36 = $388.89
2. Money Factor: 0.00208333
Formula: Annual Interest Rate ÷ 24
Calculation: 5% ÷ 24 = 0.00208333
*When user selects Annual Interest Rate (%), we calculate Money Factor. When user selects Money Factor, we calculate Annual Interest Rate.
3. Monthly Interest: $129.17
Formula: (Auto Price - Down Payment - Trade Allowance + Residual Value) × Money Factor
Calculation: (50,000 - 10,000 - 2,000 + 24,000) × 0.00208333 = $129.17
4. Money Factor Equivalent APR: 5%
Formula: Money Factor × 24
*This equals the Annual Interest Rate and displays as Money Factor Equivalent APR
5. Monthly Tax: $36.26
Formula: (Monthly Depreciation + Monthly Interest) × Sales Tax (%)
Calculation: (388.89 + 129.17) × 7% = $36.26
Additional Cost Calculations
Down Payment: $10,000
As entered by user
Upfront Tax: $700
Formula: Down Payment × Sales Tax (%)
Calculation: $10,000 × 7% = $700
Amount Due at Signing: $10,700
Formula: Down Payment + Upfront Tax
Calculation: $10,000 + $700 = $10,700
Sales Tax to Own After Lease Ends: $1,680
Formula: Residual Value × Sales Tax (%)
Calculation: $24,000 × 7% = $1,680
Total Lease Payments: $19,955.52
Formula: (Monthly Depreciation + Monthly Interest + Monthly Tax) × Lease Term
Calculation: (388.89 + 129.17 + 36.26) × 36 = $19,955.52
Total Cost to Own After Lease Ends: $58,335.52
Formula: Down Payment + Total Lease Payments + Trade Allowance + Sales Tax to Own + Residual Value + Upfront Tax
Calculation: $10,000 + $19,955.52 + $2,000 + $1,680 + $24,000 + $700 = $58,335.52
Auto Lease Calculation Formulas
Monthly Lease Payment Formula:
Monthly Payment = Monthly Depreciation + Monthly Interest + Monthly Tax
Where:
- Monthly Depreciation = (Auto Price - Down Payment - Trade Value - Residual Value) ÷ Term in Months
- Monthly Interest = (Auto Price - Down Payment - Trade Value + Residual Value) × Money Factor
- Monthly Tax = (Monthly Depreciation + Monthly Interest) × Sales Tax Rate
Money Factor Conversion:
APR = Money Factor × 24 × 100
Money Factor = APR ÷ 100 ÷ 24
Benefits of Using Our Calculator
- Compare lease and loan payments side-by-side
- Calculate total cost of ownership for both options
- Understand the impact of different down payments and terms
- Convert between money factor and APR automatically
- Factor in sales tax and trade-in value
- Determine exact payoff and lease-end dates
FAQ
What is a Money Factor?
A money factor is the lease equivalent of an interest rate. To convert money factor to APR, multiply by 2400. For example, a 0.0021 money factor equals 5.04% APR.
Should I Lease or Buy?
Leasing typically offers lower monthly payments but no ownership equity. Buying costs more monthly but builds equity and eliminates mileage restrictions.
What Is Residual Value?
Residual value is the vehicle's estimated worth at lease end. Higher residual values result in lower monthly lease payments.
Are There Additional Lease Fees?
This calculator includes basic lease calculations. Additional fees may include acquisition fees, disposition fees, and excess mileage charges.
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