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Car Lease Calculator

This car lease calculator works out the monthly payment from price, down payment, residual value and interest rate. With a price of 30,000, 3,000 down, 21,000 residual, 36 months and 2.9% interest, it is 224.21 a month.

Source: Wikipedia – Lease: lease payments and residual value. Updated: .

Gross price of the vehicle. The list price is usual for the lease factor. Any currency works.
One-off payment at the start. It lowers the monthly payment, though not necessarily the total paid.
The dealer’s projected value of the car at return. A high residual lowers the payment.
%
The rate the lessor charges. Often 0 to 6%.
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Result

Result
Lease payment: 224.21 a month
More figures
  • Lease factor: 1.03 (rather expensive)
  • Total payments: 11,072 (down payment 3,000 plus 36 × 224.21)
  • Depreciation of the vehicle: 9,000 (30% of the price)
  • Finance cost (payments minus depreciation): 2,072
Calculation
Payment = (price − down payment − residual ÷ (1 + i)ⁿ) × i ÷ (1 − (1 + i)⁻ⁿ), with i the monthly rate from 2.9% effective annual interest.
Excludes mileage charges, excess mileage, fees and insurance. The lease factor is only a rough guide.

How it is calculated

How to calculate a lease payment

A lease is a loan with a residual value: you finance the price minus the down payment, but do not have to repay everything because the residual value stays behind. The payment is (price − down payment − residual ÷ (1 + i)ⁿ) × i ÷ (1 − (1 + i)⁻ⁿ) with monthly rate i and n months. A high residual lowers the payment noticeably.

The lease factor

The lease factor relates the monthly payment to the list price: (payment + down payment ÷ term) ÷ list price × 100. As a rule of thumb, slightly different by source: up to 0.5 very good, up to 0.8 good, up to 1.0 average, above that rather expensive. Because dealers often discount the list price, it compares offers only roughly.

Money factor in the US

US dealers often quote a money factor instead of an interest rate. Multiply it by 2,400 to get the approximate annual rate: a money factor of 0.0012 is about 2.9%.

Not included

Excess mileage, damage charges, fees, insurance and taxes are not included. With contracts that settle on residual value, the customer carries the risk that the car is worth less than projected.

Frequently asked questions

How do you calculate a car lease payment?

As an annuity with a residual: (price − down payment − discounted residual) times the rate divided by the annuity factor. The calculator does this.

What is a good lease factor?

As a rule of thumb, below 1.0 is average to good, below 0.8 good and below 0.5 very good. It refers to the list price.

How does the down payment affect the lease?

It lowers the monthly payment because less is financed. The total paid changes only through the interest effect.

Why does a high residual value help me?

You pay only the depreciation plus interest. The higher the residual, the smaller the depreciation and so the payment.

How do I find the interest rate of a lease offer?

Choose “The interest rate of my offer” and enter price, down payment, residual, term and payment. The calculator shows the effective annual rate.

Sources and legal basis

As of:

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