Calculate your monthly lease payment
Calculating a monthly lease payment adds the depreciation charge to the finance charge. The Lease Calculator needs cap cost, residual, term in months and money factor. A $30,000 capitalized cost, $18,000 residual, 36-month term and money factor 0.00125 produce about $393.33 a month in the reference fixture ($333.33 depreciation plus $60 finance).
QuickCalculators reports that total as an estimate of the base payment before tax.
Negotiated cap cost and residual drive the result as much as the money factor.
Calculate the depreciation charge
Calculating the depreciation charge divides the value used over the lease by the term. The Lease Calculator uses (cap cost - residual) / months. On the $30,000 / $18,000 / 36 example, depreciation is $12,000 / 36 = $333.33 per month.
The residual is the depreciation floor: the lease pays for value consumed, not the whole asset. QuickCalculators states that residual assumption on the result.
A higher residual lowers the depreciation charge and the payment, all else equal.
Calculate the finance charge
Calculating the finance charge multiplies (cap cost + residual) by the money factor. The Lease Calculator applies that product as the monthly finance piece. With cap $30,000, residual $18,000 and money factor 0.00125, finance is $48,000 × 0.00125 = $60.
QuickCalculators adds finance to depreciation for the payment.
Money factor is not the same number as an interest rate percentage; conversion is separate.
Convert the money factor to an APR
Converting the money factor to an APR uses the common approximation APR ≈ money factor × 2400. The Lease Calculator reports that approximate APR beside the payment. Money factor 0.00125 × 2400 ≈ 3.0% APR. QuickCalculators labels the conversion as approximate so it is not treated as a Truth-in-Lending disclosure.
Provider terms vary on fees that affect effective cost beyond this base formula.
Read the disclaimer
QuickCalculators labels Lease Calculator results as estimates for information only. The Lease Calculator is not consumer-credit advice. Provider terms vary on taxes, fees, mileage and wear charges. Confirm every line with the lease contract.
Correct a common misconception: a lease payment finances the full vehicle price
A common misconception is that a lease payment finances the full vehicle price like a loan. A lease mainly finances depreciation down to residual plus a finance charge. The Lease Calculator shows that split explicitly.
Frequently asked questions
How is a lease payment calculated?
A lease payment is calculated as depreciation charge plus finance charge. The Lease Calculator computes (cap - residual) / term plus (cap + residual) × money factor.
What is capitalized cost?
Capitalized cost is the amount used as the lease basis, often negotiated vehicle price plus fees minus cap-cost reductions. The Lease Calculator takes cap cost as an input.
What is residual value?
Residual value is the projected value at lease end and the depreciation floor. The Lease Calculator subtracts it from cap cost when computing depreciation.
How does money factor relate to APR?
Money factor times 2400 approximates APR. The Lease Calculator reports that approximation with the payment.
Do provider terms vary?
Provider terms vary widely. The Lease Calculator models the base payment only; taxes, fees and mileage rules come from the lessor.
Summarize the Lease Calculator
The Lease Calculator builds a monthly lease payment from depreciation and finance charges using cap cost, residual, term and money factor, and approximates APR as money factor × 2400. QuickCalculators notes that provider terms vary and labels results as estimates to confirm on the contract.