Lease vs. buy calculator
Total cost of leasing against buying.
Put this calculator on your site
Get it as a ready-made Gravity Forms template. Import it, match your colors, publish.
- Import-ready form file
- Step-by-step build guide
- Works with any theme
How it's calculated
Leasing costs what you pay: the amount due at signing plus every monthly payment, and at the end you own nothing. Buying over the same months costs the down payment plus the loan payments, but at the end you hold a car worth something less the loan balance that remains; that equity comes off the cost. The loan payment and balance use the standard amortization formulas. The comparison is fair only over the same period, which is why it runs to the end of the lease; keeping a bought car longer is where buying usually pulls ahead, since the payments stop and the depreciation slows.
Is it cheaper to lease or buy a car?
Over three years the two are often close, as the defaults show; the lease has lower payments but leaves you with nothing, while buying leaves equity. Over six or more years buying almost always wins because the payments end. Leasing suits people who want a new car every three years, drive under the mileage cap and can deduct it for business.
What is a residual value?
The lease company's estimate of what the car will be worth at the end of the term, set as a percentage of the sticker price. It drives the lease payment: you pay the difference between price and residual, plus interest. A high residual means a cheap lease, and it is also the price you can buy the car for at the end. Use it as the value percentage here.
What is not in this comparison?
Mileage penalties and wear charges on the lease, gap insurance, the lease's money factor versus the loan rate (both are in the payments already), and tax differences by state. Also the years after the loan is paid off, which are the cheapest years of owning a car.
Results are estimates for informational purposes only and are not financial, medical or legal advice.