Car Lease vs Buy Calculator

Should you lease it or buy it? This free car lease vs buy calculator compares the estimated total cost of buying versus leasing the same car over the same period — buy cost as down payment plus loan payments minus resale value, lease cost as due at signing plus monthly payments — so you can see which option leaves more money in your pocket.

How to use this calculator

Start with the vehicle price and the comparison term — typically 3 years, since most leases run 24 to 36 months. Then work through the buy side: your down payment, the loan APR and loan term a lender quoted you, and what you think the car will be worth when the term ends (check used-car values for a similar 3-year-old model). Then work through the lease side: the amount due at signing, the monthly lease payment from the dealer's quote, and the lease term in months.

Everything recalculates instantly. The verdict shows the cheaper option and how much you would save. If leasing and buying are within a few hundred dollars, don't decide on the number alone — read the qualitative notes below, because mileage limits, equity, and flexibility often matter more than the raw dollars.

How it works

The calculator estimates the total cash cost of each option over the comparison term, then subtracts the two:

Buy total cost = down payment + (monthly loan payment × months in the term) − resale value at the end of the term. The monthly loan payment uses the standard amortization formula: M = P × r(1+r)^n / ((1+r)^n − 1), where P is the amount financed (price minus down payment), r is the monthly interest rate (APR ÷ 12), and n is the loan term in months. Subtracting the resale value credits you for the equity you would walk away with.

Lease total cost = due at signing + (monthly lease payment × months in the term). Simple: what you pay up front plus everything you pay while you drive it.

Verdict = whichever total is lower, and the difference is how much you would save. All figures are estimates, rounded to the nearest dollar.

Worked example with the default inputs — a $30,000 car over a 3-year term: buying with $3,000 down, a 6.9% APR 60-month loan, and a $15,000 resale value gives a monthly payment of $533.36 and a buy total cost of $7,200.94 (3,000 + 533.36 × 36 − 15,000). Leasing with $3,000 due at signing and $399/month for 36 months gives a lease total cost of $17,364.00 (3,000 + 399 × 36). Buying wins by $10,163.06 in this example.

What the numbers don't capture: leases usually limit you to 10,000–12,000 miles a year, with overage charges that can erase the savings. Buying builds equity and leaves you with a car to keep driving payment-free, while a lease lets you drive a new car every few years with lower monthly payments. Buying a car that holds its value well (high resale value) almost always favors buying; heavy depreciation and low lease payments favor leasing.

Assumptions and exclusions: the loan continues past the comparison term in this simplified math (only the payments made during the term count), so the buy cost does not include paying off the remaining loan balance. Costs assumed roughly equal for both options — insurance, fuel, maintenance, repairs — are excluded, as are sales tax, title, registration, and dealer fees. These are estimates for comparison only, not financial advice.