Car Lease vs Buy
Compare the total cost of leasing versus financing the same car.
About Car Lease vs Buy
A lease's total is the down payment plus the monthly payments over its term. Buying is compared as a loan amortized at the finance rate over the loan term. Leases look cheaper monthly but end owning nothing, so a total-cost comparison is what makes the decision honest.
Formula
Car Lease vs Buy
Lease total = down + payment x term; buy total = amortized payments + down
- finance rate
- APR applied to the financed balance
Worked example
With the default values below, Car Lease vs Buy returns Total Lease Cost of $20,120.00. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Vehicle priceminimum 0
- 32,000
- Down paymentminimum 0
- 5,000
- Lease termminimum 1 mo
- 36 mo
- Lease paymentminimum 0 $/mo
- 420 $/mo
- Finance rateaccepts 0–30 %
- 6 %
- Finance termminimum 1 mo
- 60 mo
Results
- Total Lease Cost
- $20,120.00
- Total Buy Cost
- $36,319.14
- Buy Monthly Payment
- $521.99
- Lower Total Cost
- Lease has the lower total cost
Step by step
- 1Values used
- 2Car Lease vs Buy
- 3Total Lease Cost= 20,120.00
- 4Total Buy Cost= 36,319.14
- 5Buy Monthly Payment= 521.99
- 6Lower Total Cost= Lease has the lower total cost
Assumptions and limits
- The result is derived only from the 6 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax, fees or charges or compounding frequency into account.
- Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Frequently Asked Questions
How is Car Lease vs Buy calculated?
Lease total = down + payment x term; buy total = amortized payments + down A lease's total is the down payment plus the monthly payments over its term. Buying is compared as a loan amortized at the finance rate over the loan term.
Why does Car Lease vs Buy matter?
Leases look cheaper monthly but end owning nothing, so a total-cost comparison is what makes the decision honest.
What values do I need to enter?
This calculator takes 6 inputs: Vehicle price, Down payment, Lease term, Lease payment, Finance rate, Finance term. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.