Proration of Taxes Calculator

Car Lease Payment Calculator

24 Months 36 Months 48 Months 60 Months
(APR / 2400)

Estimated Monthly Payment

$0.00
Monthly Depreciation: $0.00
Monthly Rent Charge: $0.00
Monthly Sales Tax: $0.00
Total Net Capitalized Cost: $0.00
function calculateLease() { var msrp = parseFloat(document.getElementById('lease_msrp').value); var residual = parseFloat(document.getElementById('lease_residual').value); var down = parseFloat(document.getElementById('lease_down').value); var trade = parseFloat(document.getElementById('lease_trade').value); var term = parseFloat(document.getElementById('lease_term').value); var mf = parseFloat(document.getElementById('lease_mf').value); var taxRate = parseFloat(document.getElementById('lease_tax').value) / 100; if (isNaN(msrp) || isNaN(residual) || isNaN(down) || isNaN(mf) || msrp <= 0) { alert("Please enter valid numbers for all required fields."); return; } // 1. Net Capitalized Cost var netCapCost = msrp – down – trade; if (netCapCost < residual) { alert("The Net Capitalized Cost cannot be less than the Residual Value."); return; } // 2. Depreciation Fee var depreciationFee = (netCapCost – residual) / term; // 3. Finance Fee (Rent Charge) var rentCharge = (netCapCost + residual) * mf; // 4. Base Monthly Payment var basePayment = depreciationFee + rentCharge; // 5. Tax var monthlyTax = basePayment * taxRate; // 6. Total Payment var totalMonthly = basePayment + monthlyTax; // Update UI document.getElementById('lease_monthly_total').innerText = '$' + totalMonthly.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res_depreciation').innerText = '$' + depreciationFee.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res_rent').innerText = '$' + rentCharge.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res_tax').innerText = '$' + monthlyTax.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('res_net_cap').innerText = '$' + netCapCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('lease_result_box').style.display = 'block'; }

Understanding Your Car Lease Calculation

Calculating a car lease payment is significantly different from a standard auto loan. While a loan is based on the total price of the vehicle, a lease is primarily based on the projected depreciation of the car over the time you drive it. This guide explains the specific variables used in our calculator to help you secure the best deal.

Key Components of a Lease Payment

  • Gross Capitalized Cost: This is the negotiated price of the vehicle plus any added fees or service contracts. Always negotiate the MSRP just as you would for a purchase.
  • Residual Value: This is the estimated value of the car at the end of the lease term. It is set by the leasing company (often the manufacturer's financial arm). A higher residual value usually leads to a lower monthly payment.
  • Money Factor: This represents the interest rate on a lease. To convert a money factor to a standard APR, multiply it by 2,400. For example, a money factor of 0.00125 is equivalent to a 3% APR.
  • Cap Cost Reductions: This includes your down payment, trade-in value, and any manufacturer rebates that reduce the amount being financed.

The Lease Formula Explained

Our calculator uses the industry-standard formula to determine your costs:

Monthly Payment = [(Net Cap Cost – Residual) / Term] + [(Net Cap Cost + Residual) × Money Factor]

The first part of the formula covers Depreciation, and the second part covers the Rent Charge (the cost of borrowing the money).

Example Calculation

Imagine you are leasing a SUV with the following terms:

Negotiated Price $40,000
Down Payment $4,000
Residual Value (60%) $24,000
Term 36 Months
Money Factor 0.0015 (3.6% APR)

In this scenario, your Net Cap Cost is $36,000. Your monthly depreciation would be $333.33 ($12,000 / 36), and your monthly rent charge would be $90.00 ($60,000 × 0.0015). Before taxes, your monthly payment would be $423.33.

Pro Tips for Lowering Your Payment

  1. Negotiate the Price: Even though it's a lease, you can negotiate the selling price (Cap Cost).
  2. Check for MSDs: Multiple Security Deposits (MSDs) can sometimes lower your money factor and save you interest over the life of the lease.
  3. Verify the Money Factor: Dealerships sometimes "mark up" the money factor. Ask for the "buy rate" to ensure you are getting the manufacturer's base interest rate.

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