Lease vs Buy Car Calculator

Over the lease term itself, leasing usually has the lower monthly payment but buying usually wins on total net cost — because at the end of the loan horizon you own an asset worth thousands, while a lease returns nothing. The gap narrows for fast-depreciating vehicles, which is exactly what this calculator models: both columns are true net cash, with the buy side credited for the car’s estimated resale value.

The money factor is the lease world’s interest rate — multiply it by 2,400 to get the equivalent APR (a 0.0025 money factor ≈ 6% APR). Dealers quote it as a small decimal; always convert it to APR to judge whether the financing is competitive.

The residual is what the leasing company predicts the car will be worth at lease end, set as a percent of MSRP. A higher residual means less depreciation to pay for and a lower monthly payment. Typical 36-month residuals run 50–60%.

Leasing fits if you want a new car every 2–3 years, drive within the mileage cap, value a warranty-covered payment, or the vehicle depreciates quickly (the leasing company eats that risk at a fixed price). Buying wins if you keep cars long — the years after payoff are the cheapest driving there is.