Lease vs Buy Car Calculator
Compare the true cost of leasing vs buying a car. See which option is cheaper over 3, 5, or 7 years, and find the best fit for your driving habits and financial goals.
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How to Use This Calculator
Compare Total Cost tab
The default tab. Enter the vehicle price, lease money factor, residual value %, and down payments for both options. The calculator computes total lease cost (payments + fees) vs total buy cost (payments minus equity) over the same period. The winner is the option with the lowest net cost.
5-Year Analysis tab
Goes beyond one lease term. Models lease-and-return-then-lease-again vs buy-and-keep over 5 and 7 years. Factors in maintenance differences (leased cars stay under warranty; owned cars face out-of-warranty costs after year 3), insurance premium differences, and the breakeven point where buying becomes cheaper.
Lifestyle Fit tab
A decision matrix based on how you actually use a car. Answer 6 questions about annual mileage, modification desire, equity preference, credit score, how long you keep cars, and driving style. The calculator scores leasing and buying from 0-10 and recommends the better fit.
Share your result
Every input is encoded in the URL. Click Share to send your exact scenario to a spouse, financial advisor, or car dealer.
The Formula
Lease and buy costs are calculated using standard auto finance formulas:
Monthly Payment = Depreciation + Finance Charge
Depreciation = (Cap Cost − Residual Value) ÷ Term
Finance Charge = (Cap Cost + Residual Value) × Money Factor
Buy Payment (Standard Amortization)
PMT = P × [r(1+r)n] ÷ [(1+r)n − 1]
where P = principal, r = monthly rate, n = months
Total Cost Comparison
Lease Total = Payments + Down + Acquisition Fee + Disposition Fee
Buy Net Cost = Payments + Down − (Car Value − Remaining Loan Balance)
Winner = lower total cost over the same time period
The money factor is the lease equivalent of an interest rate. Multiply by 2,400 to get the approximate APR. For example, a 0.0025 money factor equals about 6.0% APR.
The residual value is the predicted worth of the car at lease end, expressed as a percentage of MSRP. A higher residual means lower depreciation and a lower monthly payment.
Example
Mike & Jen — Denver, CO
Looking at a $42,000 SUV. Comparing a 36-month lease at 0.0023 money factor, 52% residual, $2,500 down vs a 60-month purchase at 5.9% APR, $5,000 down. They drive 12,000 miles per year.
Compare Total Cost tab (36-month period)
Over 3 years, leasing costs $2,620 less than buying. But buying builds $11,206 in equity.
5-Year Analysis tab
After 5 years, buying saves $6,270. The longer they keep the car, the more buying wins — especially after the loan is paid off at month 60.