Lease vs. Buy Calculator
Leasing feels cheaper month-to-month — but is it? Compare the all-in cost of a 3-year lease against buying and selling at the same point, including the residual value you'd have if you bought.
Enter your numbers
Both scenarios use the same vehicle price and 3-year term.
Vehicle details (shared)
Lease scenario
Buy scenario
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Lease — 3-year total
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At term end: return car, no equity.
Buy — 3-year net cost
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At month 36: sell at estimated trade-in value.
Show all assumptions
Estimates only. Does not include sales tax, insurance, maintenance, or fuel (add these in the 5-Year TCO Calculator). Depreciation is highly model-specific; use Carfax or Edmunds for make/model-specific rates. Excess-mileage penalties and wear-and-tear charges at lease return can significantly alter the lease total.
This calculator provides estimates only. Actual ownership costs vary by driving habits, vehicle condition, local rates, and market conditions. Figures are general information — not financial, legal, or tax advice. Confirm with your insurer, lender, or a qualified advisor before you buy.
Why lease-vs-buy math is complicated
Leasing math is deliberately opaque — 'money factor' instead of APR, residual values set by the manufacturer, acquisition fees buried in fine print. This calculator translates everything into plain dollar totals so you can compare lease vs. buy on the same footing.
How to use this calculator
- 1 Enter the vehicle price, lease money factor (APR equivalent), and residual value.
- 2 Enter your down payment and loan APR for the buy scenario.
- 3 Read the 3-year total for each path and the side-by-side savings.
- 4 Check the assumptions panel to see exactly what each scenario includes.
Frequently asked questions
Is it cheaper to lease or buy a car?
It depends on the vehicle, your driving habits, and current money-factor rates. Leasing often has lower monthly payments but no equity at the end; buying costs more monthly but leaves you with a trade-in value. This calculator shows the total outlay for both over 3 years so you can compare directly.
What is the money factor on a lease?
The money factor is the leasing equivalent of an interest rate. Multiply it by 2,400 to convert to an approximate APR. For example, a money factor of 0.00125 ≈ 3% APR. Dealers don't always volunteer the money factor; you can ask for it explicitly.
What is residual value?
The residual value is the manufacturer's estimate of what the vehicle will be worth at the end of the lease term. It determines your monthly payment (higher residual = lower payment) and your purchase-option price. It's set by the leasing company, not the market.
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