Enter one vehicle. We use the Federal Reserve's official lease-payment formula, then adjust both sides for sales tax, running costs, equity built, and the opportunity cost of your cash.
⚠ Estimates only, not financial advice — see the note below the results for details. US vehicles only for now.
Each line already includes every adjustment above it — this isn't a list to add up. Compare using the bottom line only.
Estimates only, not financial advice. Lease payment uses the Federal Reserve's official formula: depreciation charge (adjusted cap cost minus residual value, divided by term) plus rent charge (money factor times cap cost plus residual). Money factor is derived from your entered APR-equivalent (money factor = APR ÷ 2,400, the standard industry conversion). Sales tax on the lease is applied monthly to the payment, replacing the upfront tax — this is how most states tax leases, per the Federal Reserve. Buy-side sales tax is applied upfront and financed into the loan. Equity built values the vehicle's expected resale value, spread evenly across your ownership period; a leased vehicle is returned, so it builds none.
Lease vs Buy a Car takes one vehicle and runs both paths through four stages to estimate the true monthly cost of each.
Buying uses a standard loan amortization on the financed amount (price minus down payment, plus sales tax). Leasing uses the Federal Reserve's official formula: a depreciation charge (how much the car's value drops during your lease, divided by the term) plus a rent charge (the money-factor equivalent of interest), plus monthly sales tax on that payment.
Both sides add annual insurance and maintenance. Leasing also spreads in your disposition fee and the cost of any miles you're likely to drive over your mileage allowance.
When you buy, you eventually own an asset — we spread its expected resale value evenly across your ownership period as a credit. A leased car is handed back at the end of the term, so leasing builds no equity at all.
Both a down payment and a lease's cap cost reduction (plus its acquisition fee) tie up cash that could otherwise be invested. We add back the monthly opportunity cost of that capital, valued at the investment return rate you enter, to get each option's net true monthly cost.
No. Lease vs Buy a Car gives a directional estimate to help you think through a decision, not a substitute for a financial advisor or the actual numbers in a lease or loan offer. Real deals vary by lender, dealer markup, and your credit profile.
We currently support a set of major US cities. Use the "View supported cities" button at the top of the page for the full list — we add more based on demand. This calculator is US-only for now.
The money factor is how the leasing industry expresses the interest-like charge on a lease, usually as a small decimal like 0.00188. It's mathematically related to APR by a standard conversion: money factor = APR ÷ 2,400. The overall lease-payment formula — depreciation charge plus rent charge — is documented in the Federal Reserve's official consumer guide to vehicle leasing.
When you buy a car, most states tax the full purchase price upfront. When you lease, the Federal Reserve notes that in most states, a monthly tax on your lease payment replaces that upfront tax — so we apply your city's sales tax rate to the monthly lease payment instead of the full vehicle price.
Financing a car eventually gives you an asset you can sell — that resale value offsets what you spent. A leased car always goes back to the leasing company at the end of the term, so there's no resale value to offset, no matter how well you maintained it.
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Rate data: 2026