How to calculate a car lease payments

Calculate your monthly car lease payments. How much will it cost you to lease your car per month? Let’s visit this in more detail to help you understand and calculate how much your monthly payments will be when you lease your car. Though if you’re looking to calculate a car lease if you’re considering to take over a lease, then visit – an online authority of lease transfers.

When you know the basic factors of your lease deal, you can calculate your monthly lease payments and overall costs. Calculating a car lease you’ll wan to consider the following.

  • Finding your monthly payment
  • Calculate your total lease costs
  • Discover hidden fees
  1. What is the Manufacturer’s Suggested Retail Price (MSRP) for your car?
    1. This is your vehicles sticker price, not including any additional charges as destination, delivery or any other fees or charges. Ex. $25,000
  2. What is your Base Cap Cost?
    1. Your base cap cost is the negotiated lease price for the vehicle. This will be the cars price you and the dealer agreed upon, which likely already includes any negotiated discounts or reductions from the sticker price. This is known as the Base Cap Cost in a vehicle lease agreement. Ex. $23,500
  3. Are there any additional costs included in the lease agreement when calculating car lease payments?
    1. Are there other costs as bank (acquisition) fees, luxury tax, insurance, extended warranty, added options, etc. included in the price of the car you’re leasing or purchasing?
  4. What Cap Cost Reductions do you have?
    1. The cost of you lease is reduced by any payments you put down initially, such as a down payment or trade-in vehicle or credit. This may also include any rebates from the manufacturer. Ex. Down Payment = $2,100
  5. Calculating steps 1-4 above will give you your Adjusted (Net) Capital Cost. This is the Net Cap Cost that your lease payment is calculated.
    1. Your Adjusted (Net) Capital Cost is calculated by your Base Cap Cost plus (+) any additional costs incurred in the lease, less (-) and reductions or Cap Cost Reductions. This is referred most often as the Cap Cost.
  6. Calculate your Residual Value
    1. Here we figure the lease-end residual value, or percentage, for your car. The residual value is an estimate of your cars wholesale value at the end of the lease agreement or term. The higher the value, the lower the monthly payments. The residual values are often set by the lease companies, therefore you’ll need to get this value from the dealer or the lease company.
    2. Ex. Your car will be worth $15,000 once you’ve fulfilled your lease agreement.
  7. Figure out your ‘Money Factor’
    1. The Money Factor is expressed as a smaller number, and determines the lease finance charges in your lease. This rate is not disclosed in your lease agreement, however your agreement will show all financial charges expressed as ‘Lease Charge’ or ‘Rent Charge’. It may be expressed as: .00352.
    2. To calculate, divide your rent charge by the number of months in your vehicle lease. Take this number and divide by the total of the Cap Cost and Residual to get your Money Factor.
  8. Vehicle Term – What is the length of your car lease term?
    1. A lease term will be expressed in months. Ex. 24, 36, 48 months. Typical terms are 24 (2 years), 36 (3 years), 48 (4 years). Sometimes different terms are accepted from the standard. Remember, when you lease a car and considering the vehicle lease term on the agreement, always consider the manufacturers warranty on the vehicle. If the warranty expires you will be subject to pay those repair bills at your own expense.
  9. Sales Tax
    1. As with new car sales, leased car agreement also come with a tax. Each tax may vary however from province to province, state to state, and is dependent upon the area you live. For our example sake, let’s use 7.5% as the sales tax. With most areas, the sales tax is already calculated in your monthly payments – however some areas will require the sales tax to be paid up front.
    2. For example, if your monthly payment is $250.00 and your sales tax rate is 7.5%, then you’ll be paying $18.75 in taxes for a monthly vehicle lease payment cost of $268.75 ($250.00 + $18.75)

Exit a Car Lease

As car leasing becomes more common, many drivers are asking “How can you get out of a car lease?” and how can I do it early with no penalties.

Traditional methods of ending a car lease were very expensive and potentially damaging to one’s credit. The most affordable option to break a car lease early is to perform a car lease transfer. In this process, the car lease obligation for the automobile is transferred from the current lessee to a new lessee. The new lessee will bear the financial responsibilities for the auto lease until it expires or if the lease is transferred again.

Once making contact with a lease buyer through, the parties will notify the dealer and finance company once you have agreed on a car lease transfer that you would like to break your lease. The buyer will submit to a credit check and both parties will sign a lease transfer agreement issued by the finance company. The process is complete once you have signed the documents and they’re processed by the lease company.

This process to break your lease takes about 5 business days once the car lease transfer has been confirmed by you and the new buyer. Open a free account with to sell your car lease today.

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