How we calculate lease payments
Every payment on this site comes from the same formula lenders and dealers use. Here is exactly how it works.
1. Start from the lease program
Each offer includes the car's MSRP and selling price, plus the lender's program for that month and region:
- Residual value: what the car is expected to be worth at lease end, as a percent of MSRP.
- Money factor: the lease interest rate. Multiply by 2,400 to get the approximate APR.
- Incentives: lease cash from the manufacturer that lowers the price.
2. Work out the payment
Adjusted cap cost = selling price + acquisition fee − incentives − cash down
Depreciation = (adjusted cap cost − residual) ÷ months
Rent charge = (adjusted cap cost + residual) × money factor
Monthly payment = (depreciation + rent charge) × (1 + sales tax)
3. Price every car with the same amount upfront
Advertised deals each assume a different amount down, which makes them hard to compare. We take the amount you choose to pay at signing and apply it the same way to every car. It covers the first payment and fees, and the rest lowers the cap cost (California taxes that part too). At "$0 down", you pay only the first month and fees.
4. Show the true cost
The true monthly cost adds everything you pay (due at signing plus all monthly payments) and spreads it over the lease. The value score compares the zero-down payment to MSRP: 0.7% of MSRP or better scores 100.
What can differ at the dealer
- Payments assume top-tier credit unless you choose another tier. Lower tiers usually get a higher money factor.
- Tax and registration are estimates for your ZIP. Some incentives have eligibility rules, which we flag.
- Dealers set the final selling price. The dealer's signed contract is what counts.