Does this include sales tax?

No. Add tax into payments if you want a tax-inclusive comparison.

What about mileage overages?

Not modeled. Add expected overage cost to the lease side if relevant.

Can I include a lease buyout?

This focuses on the lease horizon. Add buyout as an extra cost if you plan to purchase at end.

Does it model residuals?

Residual is implicit via the depreciation %. Adjust that input to match the quoted residual.

Is insurance included?

No. Add insurance/maintenance separately if you want total cost of ownership.

finance calculator

Lease vs Buy Car Calculator

Compare lease costs to buying a car (loan) over the lease horizon, including equity from ownership.

Results

Buy monthly payment: $566
Payments made over lease horizon: $25,381
Loan balance at lease horizon: $12,904
Estimated vehicle value: $19,250
Estimated equity: $6,346
Net cost of buying over lease horizon: $19,035
Effective monthly (buy): $529
Total lease cost: $15,500
Effective monthly (lease): $431

How to use this calculator

Enter vehicle price, down payment, APR, and loan term.
Enter lease payment, term, drive-off, and disposition fee.
Adjust depreciation to reflect expected value at lease end and compare effective monthly costs.

Inputs explained

Depreciation: Percent drop in value over the lease horizon; adjust for make/model and mileage.
Lease due at signing: Includes any cap cost reduction and upfront fees.

How it works

Loan payment uses standard amortization. We compare the same horizon as the lease term and calculate remaining balance.

Estimated value = price × (1 − depreciation%). Equity = estimated value − balance. Net buy cost subtracts positive equity.

Lease cost sums payments, drive-off, and disposition fees for an effective monthly comparison.

Formula

Loan payment = Standard amortization on (Price − Down) at APR over loan term
Observed months = min(loan term, lease term)
Buy payments made = Payment × observed months + down payment
Remaining balance = Loan balance after observed months
Estimated value = Price × (1 − depreciation%)
Equity = Estimated value − Remaining balance
Net buy cost = Buy payments made − max(0, equity)
Lease total cost = Lease payment × lease term + due at signing + disposition fee
Effective monthly = Cost ÷ respective term

When to use it

Comparing a lease offer to financing the same car.
Seeing how higher down payments shift equity vs monthly cost.
Testing depreciation scenarios for brands with stronger resale values.

Tips & cautions

Include sales/use tax in payments if applicable; this model keeps tax separate for simplicity.
If you plan to keep the car long-term, evaluate costs beyond the lease horizon too.
High money factor or disposition fees can tilt the math toward buying.
Excludes sales tax, maintenance, insurance, mileage overages, or incentives.
Uses a single depreciation percent; real-world values vary by trim/miles/market.
Does not model lease buyout options or security deposits.

Worked examples

$35k car, $5k down, 5% APR 60 mo vs $350/mo lease 36 mo, 45% depreciation

Buy payment ≈ $566/mo; buy payments over 36 mo ≈ $25,381
Balance after 36 mo ≈ $12,904; est. value ≈ $19,250; equity ≈ $6,346
Net buy cost ≈ $19,035; effective monthly ≈ $529
Lease cost ≈ $15,500; effective monthly ≈ $431

Deep dive

Compare lease versus buy costs by month, including equity from owning and fees from leasing.

Estimate payments, depreciation, and net cost over the lease term to see which option wins.

FAQs

Does this include sales tax?: No. Add tax into payments if you want a tax-inclusive comparison.
What about mileage overages?: Not modeled. Add expected overage cost to the lease side if relevant.
Can I include a lease buyout?: This focuses on the lease horizon. Add buyout as an extra cost if you plan to purchase at end.
Does it model residuals?: Residual is implicit via the depreciation %. Adjust that input to match the quoted residual.
Is insurance included?: No. Add insurance/maintenance separately if you want total cost of ownership.

Related calculators

finance

Car Lease Payment Calculator

Estimate monthly lease payment, depreciation, finance charge, and total lease cost with money factor and fees.

Simplified lease vs buy comparison without taxes, overages, or maintenance. Use as a directional estimate; confirm with dealer quotes.