How to use the Car Lease vs Buy Calculator
Use the same Comparison horizon (months) for both scenarios. The calculator combines purchase cash outlay and estimated equity with lease payments, fees, mileage charges, and maintenance, then shows the estimated net cost for buying and leasing.
- Enter the required fields, including Vehicle price ($), Comparison horizon (months), Loan term (months), and the resale, residual, and lease-term inputs.
- Under Rate input, choose Money factor or APR, then enter the matching rate field.
- Add Sales tax rate (%), fees, mileage, and maintenance inputs when they apply.
- Click Calculate.
- Read Comparison result, Buy breakdown, Lease breakdown, and Sensitivity warnings. Use Copy result or Download result (.txt) as needed.
What to enter for a car lease vs buy comparison
The calculator requires Vehicle price ($), Comparison horizon (months), Loan term (months), Your resale value estimate at horizon (% of price), Money factor or Lease APR (%), Residual value (% of price), and Lease term (months). Vehicle price must be greater than 0. The month fields accept whole numbers: 1 through 240 for the horizon, 1 through 120 for the loan, and 1 through 84 for the lease.
Blank optional fields count as zero. Sales tax accepts 0 through 25. Money factor accepts 0 through 0.02, while Lease APR (%) accepts 0 through 100. Mileage inputs affect the charge only when expected miles exceed the allowance.
How the calculator handles lease APR and end value
Choose APR under Rate input for an annual percentage rate. The calculator converts Lease APR (%) to a money factor by dividing by 100 and then by 24:
Lease APR (%): 3.0
Money factor used: 0.00125For buying, Sales tax rate (%) applies to the full Vehicle price ($). Buy cash outlay includes Down payment ($), Title, registration & doc fees ($), loan payments within the horizon, and Monthly maintenance/repairs ($) for every horizon month. If the horizon ends before Loan term (months), the remaining balance is subtracted from resale value. A longer horizon counts no later loan payments and applies the full resale assumption to end value.
For leasing, Down payment / cap cost reduction ($) lowers capitalized cost. If Capitalize acquisition fee into payments is checked, Acquisition fee ($) is added to that cost; otherwise it is due at signing. Each lease payment includes tax, and payments stop at the shorter of the horizon and Lease term (months). Lease end value is $0. Disposition fee ($) is counted at the lease term. Mileage is prorated over the lease months counted, then charged at Excess mileage rate ($/mile) above the allowance.
What the Sensitivity warnings flag
Sensitivity warnings appear when Comparison horizon (months) ends before or after Lease term (months), because early termination, re-leasing, and buyout costs are outside the estimate. A horizon beyond Loan term (months), mileage above the allowance, or resale or residual assumptions below 25% or above 85% of price also trigger warnings.
The result warns when the money factor implies an APR above 12%, or when the remaining loan balance is higher than resale value before the loan ends. It displays your assumptions and identifies conditions to check.
Examples to test in the calculator
- Compare a lease offer with a purchase loan using Vehicle price ($) and a 36-month Comparison horizon (months).
- Check 12,000 expected annual miles against a 10,000-mile Mileage allowance (miles/year).
- For a sale before the loan ends, set a shorter Comparison horizon (months) and inspect remaining balance.
When to use another financial calculator
Use this page for one-horizon purchase-versus-lease estimates. For a car payment, amount financed, total interest, and full loan schedule, use the Auto Loan Calculator. For period-by-period principal, interest, and balance details, use the Amortization Calculator. Other choices are listed in Financial Calculators for Loans, Pay, Debt & Savings.
Frequently asked questions
What does the Car Lease vs Buy Calculator compare?
It compares total cash outlay and estimated net cost over your selected Comparison horizon (months). Buying subtracts estimated end equity. Leasing uses an end value of $0.
Should I enter a lease APR or Money factor?
Choose Money factor for a decimal such as 0.00125. Choose APR for an annual percentage, then enter Lease APR (%); the calculator divides it by 100 and then by 24.
Does this calculator predict resale or residual value?
You enter Your resale value estimate at horizon (% of price) and Residual value (% of price). The calculator uses those figures in its formulas and does not provide dealer quotes or predictions.
What if my comparison horizon is shorter than the lease term?
The calculator counts lease payments only through the selected horizon and warns that an early termination fee is not included. It uses your figures for the counted months.