Quick answer
Monthly lease payment = (capitalised cost − residual) ÷ term + (capitalised cost + residual) × money factor, with money factor = APR ÷ 2400. A $35,000 car with a 60% residual, 4.8% APR and 36 months costs $500.89 a month: $388.89 depreciation plus $112.00 finance charge.
Enter the capitalised cost, residual percentage, APR and term. The calculator returns the monthly payment and its parts.
Related tools: Auto Loan Calculator: Monthly car payment after down payment and trade-in. Amortization Calculator: Full amortization schedule with optional extra monthly payments. Loan Calculator: Estimate your monthly loan payment, total interest and total cost.
How to use the Lease Payment Calculator
- Enter capitalized cost ($) (above 0).
- Enter residual value (% of cost) (%) (between 0 and 100).
- Enter rate (APR) (%) (between 0 and 100).
- Enter lease term (months) (a whole number, between 1 and 120).
- Press Calculate to see the result, and use Reset to start again.
| Input | What to enter | Allowed values |
|---|---|---|
| Capitalized cost | A number, in $ | > 0 |
| Residual value (% of cost) | A number, in % | ≥ 0, ≤ 100 |
| Rate (APR) | A number, in % | ≥ 0, ≤ 100 |
| Lease term | A whole number, in months | ≥ 1, ≤ 120 |
Formula and method
Formula
payment = (cap − residual) ÷ n + (cap + residual) × money factor; money factor = APR ÷ 2400
IEEE-754 double precision; money shown to cents, rates to 4 decimals. Results are estimates, not financial advice.
Excludes sales tax, fees and mileage charges.
Worked examples
These examples are verified: each one is an automated test case that the live calculator must reproduce exactly.
Example 1
Inputs: Capitalized cost = 35000; Residual value (% of cost) = 60; Rate (APR) = 4.8; Lease term = 36.
| Result | Value |
|---|---|
| Monthly lease payment | $500.89 |
| Depreciation | $388.89 |
| Finance charge | $112.00 |
| Money factor | 0.002 |
Example 2
Inputs: Capitalized cost = 28000; Residual value (% of cost) = 55; Rate (APR) = 6; Lease term = 39.
| Result | Value |
|---|---|
| Monthly lease payment | $431.58 |
| Depreciation | $323.08 |
| Finance charge | $108.50 |
| Money factor | 0.0025 |
The first line is the headline result (monthly lease payment). Below it the lease Payment Calculator lists depreciation, finance charge and money factor, which describe the same case from other angles. IEEE-754 double precision; money shown to cents, rates to 4 decimals. Results are estimates, not financial advice.
The two components
Depreciation: ($35,000 − $21,000) ÷ 36 = $388.89. Finance charge: ($35,000 + $21,000) × 0.002 = $112.00, where the money factor of 0.002 equals 4.8% ÷ 2,400. Multiply a money factor by 2,400 to convert it to an APR.
Negotiable and hidden items
The capitalised cost can be negotiated like a purchase price, and fees, taxes and down payments change the figure. A higher residual value lowers the payment. Mileage limits and wear charges are separate. A 0% rate is depreciation only.
How the result changes with capitalized cost
Holding every other input at the first worked example, this table changes only capitalized cost. It shows how sensitive the answer is to that one value; each row was produced by running this calculator.
| Capitalized cost | Monthly lease payment | Depreciation | Finance charge |
|---|---|---|---|
| 17500 | $250.44 | $194.44 | $56.00 |
| 35000 | $500.89 | $388.89 | $112.00 |
| 70000 | $1,001.78 | $777.78 | $224.00 |
| 140000 | $2,003.56 | $1,555.56 | $448.00 |
What happens with invalid input
These messages are produced by the calculator itself, so you know what to fix.
- Capitalized cost: entering "0" shows "Capitalized cost must be greater than 0." beside that field and no result.
- Lease term: entering "0" shows "Lease term must be at least 1." beside that field and no result.
Choosing between the Lease Payment Calculator and similar calculators
Each row shows what a related calculator on this site asks for and what it returns, so you can pick the one that matches your question.
| Calculator | You enter | It returns |
|---|---|---|
| [Auto Loan Calculator](/finance/auto-loan-calculator/) | vehicle price, down payment and interest rate | Monthly payment |
| [Amortization Calculator](/finance/amortization-calculator/) | loan amount, interest rate and term | Monthly payment |
| [Loan Calculator](/finance/loan-calculator/) | loan amount, interest rate and term | Monthly payment |
| [Interest Rate Calculator](/finance/interest-rate-calculator/) | loan amount, monthly payment and term | Interest rate (APR) |
| [HELOC Calculator](/finance/heloc-calculator/) | balance drawn, interest rate and draw period | Interest-only payment (draw period) |
Background: loans and mortgages
The interest rate is the cost of borrowing the principal; the APR also folds in certain fees, so a lower rate with high fees can have a worse APR. These calculators use the rate you enter and do not add fees, insurance or taxes, so add fees to the principal if you want to include them.
A fixed-rate loan is paid in equal instalments, early ones mostly interest. Extra payments go straight to principal, which shortens the loan and cuts interest; adjustable rates, escrow changes and prepayment penalties are not modelled.
Assumptions and limitations
- 0% rate is depreciation only
Results are estimates for planning, not financial advice. Lender terms, fees, taxes and rounding rules can change real figures, so confirm important numbers with your lender or a licensed adviser.
If a required value is empty, not a number, or outside its allowed range, the form marks that field with a message and shows no result instead of a misleading number. The automated checks deliberately try invalid entries for capitalized cost and lease term to confirm this.
Frequently asked questions
What is a money factor?
A lease's finance rate, equal to APR ÷ 2,400.
What is a residual value?
The car's predicted value at the end of the lease.
Is leasing cheaper than buying?
Payments are lower, but you own nothing at the end; see the lease vs buy calculator.
What does the Lease Payment Calculator calculate?
Monthly lease payment from capitalized cost, residual value and rate. It returns Monthly lease payment, Depreciation, Finance charge and Money factor.
What formula does the Lease Payment Calculator use?
payment = (cap − residual) ÷ n + (cap + residual) × money factor; money factor = APR ÷ 2400. Excludes sales tax, fees and mileage charges.
What do I need to enter in the lease Payment Calculator?
You enter Capitalized cost ($), Residual value (% of cost) (%), Rate (APR) (%) and Lease term (months).
How is the result rounded or limited?
IEEE-754 double precision; money shown to cents, rates to 4 decimals. Results are estimates, not financial advice. 0% rate is depreciation only.
What is an example of a lease Payment result?
With capitalized cost 35000, residual value (% of cost) 60, rate (APR) 4.8 and lease term 36, the monthly lease payment is $500.89.
Can I rely on this calculator for a decision?
Results are estimates for planning, not financial advice. Lender terms, fees, taxes and rounding rules can change real figures, so confirm important numbers with your lender or a licensed adviser. For this calculator in particular: 0% rate is depreciation only.
Related calculators
- Auto Loan Calculator — Monthly car payment after down payment and trade-in.
- Amortization Calculator — Full amortization schedule with optional extra monthly payments.
- Loan Calculator — Estimate your monthly loan payment, total interest and total cost.
- Interest Rate Calculator — Annual interest rate implied by a loan amount, payment and term.
- HELOC Calculator — Interest-only draw-period payment and the repayment-period payment of a home equity line.
- APR Calculator — Annual percentage rate of a loan once upfront fees are counted.
Sources
- Standard time-value-of-money relations (e.g. Brealey, Myers & Allen, Principles of Corporate Finance)
Content last reviewed 2026-11-04. Formulas and worked examples are checked by automated tests against independently computed values.