Enter your lease numbers and see the estimated monthly payment, broken into depreciation, finance fee and tax — updated instantly as you type.
| Residual value at lease-end | — |
| Total cost over lease (down payment + all months) | — |
A lease payment is not one number — it is three added together. The depreciation fee covers the value the car loses while it's yours: (negotiated price minus your down payment minus the residual value) divided by the number of months. The rent charge (sometimes called the finance fee) is the leasing company's profit margin, calculated as (adjusted cap cost plus residual value) multiplied by the money factor — a small decimal that works like an interest rate. Add sales tax on top of both, and you get your total monthly payment.
This structure is why two cars with the same price can lease very differently: the one with a higher predicted resale value (residual) has less depreciation to finance, so it leases cheaper even at an identical sticker price.
Leasing tends to make financial sense if you like driving a newer car every 2-3 years, want lower monthly payments than an equivalent loan, and stay comfortably within the mileage limit. Buying (with a loan or cash) tends to win if you keep vehicles 6+ years, drive high annual mileage, or want to build equity you can sell or trade in later. Compare your lease estimate above against the BreezeCalc Auto Loan Calculator to see both numbers side by side before deciding.
A lease payment has two parts. The depreciation fee is (negotiated price minus down payment minus residual value) divided by the number of months — this covers the value the car loses while you drive it. The rent charge (finance fee) is (adjusted cap cost plus residual value) multiplied by the money factor — this is the dealer's profit, similar to interest. Add both, then add sales tax, to get your total monthly payment.
The money factor is a small decimal (often 0.00100 to 0.00300) that represents the lease's finance charge, similar to an interest rate. It is usually printed on your lease offer or worksheet. If you only have an APR, divide it by 2400 to estimate the money factor (e.g. a 7.2% APR is roughly a 0.0030 money factor).
Residual value is the car's predicted worth at the end of the lease, set by the leasing company and usually expressed as a percentage of MSRP (e.g. 58% after 36 months). A higher residual value means you are financing less depreciation, which lowers your monthly payment — this is why some models lease cheaper than others despite a similar price.
Residual value is calculated as a percentage of MSRP (sticker price), while the depreciation you actually pay for is based on the negotiated price you agreed to pay. Using MSRP for the residual and the negotiated price for the cap cost mirrors how dealers actually structure a lease worksheet.
Monthly lease payments are usually lower than loan payments because you are only financing the depreciation over the term, not the full vehicle price. However, you build no equity and must stay within mileage limits, so leasing tends to cost more over the long run if you keep vehicles for many years. Compare this tool's result against the Auto Loan Calculator for a full picture.
This tool estimates tax by applying your rate to the monthly payment (depreciation plus rent charge), which is how most U.S. states tax leases. A handful of states tax the full vehicle price upfront instead — check your state's rule and treat this figure as an estimate.
This calculator does not include acquisition fees, documentation fees, registration, or a disposition fee at lease-end — these are typically a few hundred dollars each and vary by leasing company. Ask for the full lease worksheet to see every fee before signing.
Most leases charge a per-mile fee (commonly $0.15-$0.30) for every mile over the allowed limit, billed at lease-end or turn-in. If you expect to drive more than the standard 10,000-12,000 miles a year, ask about a higher-mileage lease upfront — it is almost always cheaper than paying the overage fee later.
Yes, BreezeCalc is completely free with no sign-up or registration required. All calculations run instantly in your browser and no data is stored or transmitted.