{
  "id": "auto-lease",
  "version": "aeb66aca1626",
  "status": "published",
  "name": "Auto Lease Calculator",
  "question": "What does a car lease cost in total?",
  "summary": "Computes a car lease payment with sales tax from the price, residual value, and APR or money factor, with a trade-in and its payoff, rebates, and fees, plus the amount due at signing and the total cost of the lease.",
  "category": "finance",
  "subcategory": "loans",
  "url": "https://www.acalculator.org/finance/auto-lease-calculator",
  "markdown": "https://www.acalculator.org/finance/auto-lease-calculator.md",
  "kind": "function",
  "method": "payment = ((C − R) ÷ n + (C + R) × MF) × (1 + tax), with C the net capitalized cost, R = MSRP × residual %, n the months, and MF = APR ÷ 2,400.",
  "assumptions": [
    "The payment follows the Regulation M progression: the depreciation charge plus the rent charge, spread evenly over the months.",
    "The money factor is the APR ÷ 2,400, the usual conversion; a lease contract discloses a rent charge, not an APR.",
    "Sales tax is charged on each monthly payment, as in most states; tax on the cash down or on the whole lease is not included.",
    "The first monthly payment is due at signing; any trade-in debt is added to the capitalized cost.",
    "The defaults are examples, not current offers."
  ],
  "inputs": {
    "$schema": "https://json-schema.org/draft/2020-12/schema",
    "type": "object",
    "properties": {
      "msrp": {
        "title": "MSRP (sticker price)",
        "description": "The manufacturer’s suggested retail price, which the residual percentage is taken of.",
        "type": "number",
        "x-unit": "USD",
        "exclusiveMinimum": 0,
        "maximum": 10000000
      },
      "price": {
        "title": "Negotiated price",
        "description": "The price agreed for the car, before fees, trade-in, and rebates.",
        "type": "number",
        "x-unit": "USD",
        "exclusiveMinimum": 0,
        "maximum": 10000000
      },
      "residual": {
        "title": "Residual value (% of MSRP)",
        "description": "The value the leasing company sets for the end of the lease, as a percent of the MSRP.",
        "type": "number",
        "x-unit": "percent",
        "exclusiveMinimum": 0,
        "maximum": 100
      },
      "months": {
        "title": "Lease term (months)",
        "description": "The number of monthly payments, for example 24, 36, or 48.",
        "type": "integer",
        "minimum": 1,
        "maximum": 72
      },
      "mode": {
        "title": "Finance charge as",
        "description": "Enter the lease rate as an APR or as the money factor the leasing company quotes.",
        "type": "string",
        "enum": [
          "apr",
          "mf"
        ]
      },
      "apr": {
        "title": "APR",
        "description": "The lease rate as a yearly percent; the money factor is this ÷ 2,400.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 30
      },
      "mf": {
        "title": "Money factor",
        "description": "The number the leasing company multiplies the net cap cost plus the residual by for the monthly rent charge.",
        "type": "number",
        "minimum": 0,
        "maximum": 0.0125
      },
      "down": {
        "title": "Cash down",
        "description": "Cash you pay at signing to lower the capitalized cost.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 10000000
      },
      "trade": {
        "title": "Trade-in value",
        "description": "What the dealer gives you for your current car.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 10000000
      },
      "owed": {
        "title": "Owed on the trade-in",
        "description": "The loan payoff still due on the car you trade in; any amount over its value is added to the lease.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 10000000
      },
      "rebates": {
        "title": "Rebates and incentives",
        "description": "Manufacturer or dealer rebates applied to lower the capitalized cost.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 10000000
      },
      "fees": {
        "title": "Fees added to the lease",
        "description": "The acquisition fee and other fees rolled into the capitalized cost.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 10000000
      },
      "upfront": {
        "title": "Fees paid at signing",
        "description": "Title, registration, and other fees you pay in cash when you sign.",
        "type": "number",
        "x-unit": "USD",
        "minimum": 0,
        "maximum": 10000000
      },
      "tax": {
        "title": "Sales tax on the payment",
        "description": "The sales or use tax rate charged on each monthly payment.",
        "type": "number",
        "x-unit": "percent",
        "minimum": 0,
        "maximum": 25
      }
    }
  },
  "outputs": {
    "payment": {
      "label": "Monthly payment with tax",
      "description": "The base monthly payment plus the sales tax on it.",
      "format": "money"
    },
    "base": {
      "label": "Monthly payment before tax",
      "description": "The depreciation charge plus the rent charge, each month.",
      "format": "money"
    },
    "monthlyTax": {
      "label": "Tax each month",
      "description": "The sales tax on the base monthly payment.",
      "format": "money"
    },
    "depreciation": {
      "label": "Depreciation charge",
      "description": "The net capitalized cost minus the residual value, spread over the months.",
      "format": "money"
    },
    "rent": {
      "label": "Rent charge",
      "description": "The monthly finance charge: the money factor × (net capitalized cost + residual value).",
      "format": "money"
    },
    "atSigning": {
      "label": "Due at signing",
      "description": "The cash down, the fees paid at signing, and the first monthly payment.",
      "format": "money"
    },
    "totalCost": {
      "label": "Total cost of the lease",
      "description": "All the monthly payments, the cash down, and the fees paid at signing.",
      "format": "money"
    },
    "totalPayments": {
      "label": "Total of monthly payments",
      "description": "The monthly payment with tax × the number of months.",
      "format": "money"
    },
    "totalRent": {
      "label": "Total rent charge",
      "description": "The rent charge over the whole lease.",
      "format": "money"
    },
    "netCap": {
      "label": "Net capitalized cost",
      "description": "The price plus fees and any trade-in debt, minus the cash down, trade-in equity, and rebates.",
      "format": "money"
    },
    "residualValue": {
      "label": "Residual value",
      "description": "The MSRP × the residual percent.",
      "format": "money"
    },
    "mfOut": {
      "label": "Money factor",
      "description": "The money factor used: the APR ÷ 2,400, or as entered.",
      "format": "number"
    },
    "aprOut": {
      "label": "APR equivalent",
      "description": "The money factor × 2,400, the yearly rate it is usually compared with.",
      "format": "percent"
    }
  },
  "defaultAnswer": {
    "inputs": {
      "msrp": 35000,
      "price": 33000,
      "residual": 58,
      "months": 36,
      "mode": "apr",
      "apr": 6,
      "mf": 0.0025,
      "down": 2000,
      "trade": 0,
      "owed": 0,
      "rebates": 0,
      "fees": 995,
      "upfront": 500,
      "tax": 7
    },
    "outputs": {
      "payment": 487.49051388888887,
      "base": 455.5986111111111,
      "monthlyTax": 31.891902777777776,
      "depreciation": 324.8611111111111,
      "rent": 130.7375,
      "atSigning": 2987.490513888889,
      "totalCost": 20049.658499999998,
      "totalPayments": 17549.658499999998,
      "totalRent": 4706.55,
      "netCap": 31995,
      "residualValue": 20300,
      "mfOut": 0.0025,
      "aprOut": 6
    },
    "text": "Leasing a car priced at $33,000.00 for 36 months costs $487.49 a month with tax, $2,987.49 at signing, and $20,049.66 in all."
  },
  "examples": [
    {
      "given": {
        "msrp": 35000,
        "price": 33000,
        "residual": 58,
        "months": 36,
        "mode": "apr",
        "apr": 6,
        "down": 2000,
        "trade": 0,
        "owed": 0,
        "rebates": 0,
        "fees": 995,
        "upfront": 500,
        "tax": 7
      },
      "expect": {
        "netCap": 31995,
        "residualValue": 20300,
        "depreciation": 324.8611111111111,
        "rent": 130.7375,
        "base": 455.5986111111111,
        "payment": 487.4905138888889,
        "atSigning": 2987.490513888889,
        "totalCost": 20049.6585,
        "mfOut": 0.0025
      },
      "source": "hand calculation in content.mdx; Python 3 in docs/progress/WP-49/python/auto_lease.py"
    },
    {
      "given": {
        "msrp": 19000,
        "price": 18800,
        "residual": 65,
        "months": 36,
        "mode": "mf",
        "mf": 0.00354,
        "down": 0,
        "trade": 0,
        "owed": 0,
        "rebates": 0,
        "fees": 0,
        "upfront": 0,
        "tax": 0
      },
      "expect": {
        "residualValue": 12350,
        "rent": 110.271,
        "base": 289.43766666666664,
        "aprOut": 8.496
      },
      "source": "Federal Reserve Board, Keys to Vehicle Leasing, rent charge example: 0.00354 × (18,800 + 12,350) = $110.27; the rest by hand in content.mdx"
    },
    {
      "given": {
        "msrp": 40000,
        "price": 38000,
        "residual": 55,
        "months": 39,
        "mode": "mf",
        "mf": 0.0021,
        "down": 0,
        "trade": 10000,
        "owed": 12500,
        "rebates": 1500,
        "fees": 895,
        "upfront": 0,
        "tax": 6
      },
      "expect": {
        "netCap": 39895,
        "depreciation": 458.84615384615387,
        "rent": 129.9795,
        "payment": 624.1551930769231,
        "aprOut": 5.04
      },
      "source": "hand calculation in content.mdx; Python 3 in docs/progress/WP-49/python/auto_lease.py"
    }
  ],
  "sources": [
    "Regulation M (Consumer Leasing), 12 CFR 1013.4(f), Payment calculation for motor vehicle leases. https://www.consumerfinance.gov/rules-policy/regulations/1013/4/",
    "Federal Reserve Board, Keys to Vehicle Leasing: More information about the rent charge. https://www.federalreserve.gov/pubs/leasing/resource/consider/ongoing_info6.htm",
    "Federal Reserve Board, Keys to Vehicle Leasing: frequently asked questions. https://www.federalreserve.gov/Pubs/leasing/resource/faq.htm"
  ],
  "related": [
    "lease",
    "auto-loan",
    "car-affordability",
    "auto-refinance"
  ],
  "changelog": []
}