Bankrate Auto Lease Calculator
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Reviewed by Calculator Editorial Team
Use our Bankrate Auto Lease Calculator to estimate your monthly car lease payment. This tool helps you understand your potential monthly costs when leasing a vehicle, considering factors like down payment, lease term, and interest rate.
How to Use This Calculator
To calculate your auto lease payment, follow these steps:
- Enter the vehicle price (the total cost of the car you want to lease).
- Specify the down payment (the amount you'll pay upfront).
- Choose the lease term (how long you'll lease the vehicle, typically 24-48 months).
- Enter the annual percentage rate (APR) (the interest rate for the lease).
- Select the mileage allowance (how many miles you're allowed to drive per year).
- Click Calculate to see your estimated monthly payment.
The calculator will display your monthly payment, total interest paid over the lease term, and a breakdown of costs.
Formula Used
The auto lease payment is calculated using the following formula:
Lease Payment Formula
Monthly Payment = [(Vehicle Price - Down Payment) + (Mileage Allowance × Mileage Charge)] × (Monthly Interest Rate) × (1 + Monthly Interest Rate)^(Lease Term) / [(1 + Monthly Interest Rate)^(Lease Term) - 1]
Where:
- Monthly Interest Rate = Annual Percentage Rate (APR) / 12
- Mileage Charge = Estimated cost per mile (typically $0.15-$0.30 per mile)
This formula accounts for the total cost of the lease, including the vehicle price, down payment, mileage charges, and interest.
Worked Example
Let's calculate a lease payment for a $30,000 vehicle with a $3,000 down payment, 36-month term, 3.5% APR, and 12,000 miles per year at $0.25 per mile.
Example Calculation
Vehicle Price: $30,000
Down Payment: $3,000
Lease Term: 36 months
APR: 3.5%
Mileage Allowance: 12,000 miles/year
Mileage Charge: $0.25/mile
Monthly Interest Rate: 3.5% / 12 = 0.2917%
Total Mileage Cost: 12,000 × $0.25 = $3,000/year
Total Lease Cost: ($30,000 - $3,000) + ($3,000 × 3) = $24,000 + $9,000 = $33,000
Monthly Payment: $33,000 × 0.002917 × (1.002917)^36 / [(1.002917)^36 - 1] ≈ $825.42
In this example, the estimated monthly payment is $825.42.
Interpreting Results
When you calculate your lease payment, consider these factors:
- Monthly Payment: This is your estimated monthly cost for the lease.
- Total Interest Paid: The interest charges over the lease term.
- Total Cost: The sum of your monthly payments plus any fees.
Compare different lease options to find the best deal. Remember that leasing often includes maintenance and insurance, which may be included in your monthly payment.
Frequently Asked Questions
What is the difference between leasing and buying a car?
Leasing typically involves shorter terms (2-5 years) and lower monthly payments, but you don't own the car at the end. Buying a car means you own it outright after paying off the loan.
How do I choose the right lease term?
Shorter terms (24-36 months) offer lower monthly payments but higher total costs. Longer terms (36-48 months) have higher monthly payments but lower total costs. Choose based on your budget and driving needs.
What happens if I exceed the mileage allowance?
Exceeding the mileage allowance typically results in additional charges. Some leases include unlimited mileage for an extra fee, while others charge per mile over the limit.