Lease vs Buy Car Calculator
Estimate Lease vs Buy Car totals, payments, rates, and costs for financial planning.
This lease vs buy car calculator compares the total cost of leasing a vehicle against financing and buying it outright over the same time period, accounting for monthly payments, down payment, and what you're left with (equity vs. nothing) at the end.
Enter the vehicle price, lease terms, and loan terms, and the calculator compares total cost and ending position for both options.
Worked Calculation Examples
| Scenario | Result | Calculation Step |
|---|---|---|
| $30,000 car, 3-year horizon | Lease: $12,600 total, $0 equity · Buy: $32,852 paid − $15,000 resale = $17,852 net cost | Lease total = $350 × 36 = $12,600 with nothing owned at the end. Loan payment ≈ $912.57/mo × 36 = $32,852 total, minus an estimated $15,000 resale value after 3 years = $17,852 net cost of buying, but you own the car. |
| Same $30,000 car, 6-year horizon | Buy: $32,852 total for 6 years of use · Lease: $25,200 total (two consecutive 3-year leases), $0 equity | The loan is paid off after 3 years, so total buying cost stays $32,852 for all 6 years of driving while you own the car outright for the last 3. Leasing for 6 years requires two lease terms: $12,600 × 2 = $25,200, with no equity ever built - illustrating why the better option depends heavily on how long you keep the vehicle. |
Why Leasing Often Has Lower Monthly Payments
A lease payment only covers the vehicle's depreciation during the lease term plus a finance charge, not its full value, since you're returning the car at the end. A loan payment covers the entire purchase price, which is why financing typically carries a higher monthly payment than leasing an equivalent vehicle.
What You Keep at the End
At the end of a loan term, you own the car outright and have an asset with resale value, even after depreciation. At the end of a lease, you return the vehicle with nothing to show for the payments made (unless you choose to buy it out at the residual value) - this ownership difference is often the deciding factor beyond monthly payment comparison alone.
How to Use the Lease vs Buy Car Calculator
- Open the Lease vs Buy Car Calculator and enter the values requested in the input fields.
- Check the units, percentages, dates, or time periods before reading the answer.
- Review the instant result and adjust any value to compare another scenario.
- Use the formula, example, and FAQs below to understand how the lease vs buy car calculator works.
Frequently Asked Questions
Is it cheaper to lease or buy a car?
Leasing usually has lower monthly payments, but buying builds equity in an asset you keep - over a long enough time horizon (especially if you keep a car past loan payoff), buying is often cheaper in total cost since you stop making payments while still owning the vehicle.
What are the downsides of leasing a car?
You don't build equity, mileage is capped with fees for exceeding it, and you face new payments again at lease-end unless you buy out the vehicle - leasing works best for those who prefer driving a new car every few years.
When does buying make more financial sense than leasing?
Buying tends to make more sense if you drive high annual mileage, plan to keep the car for many years past loan payoff, or want to build long-term equity rather than have a perpetual car payment.
How do I use this lease vs buy car calculator?
Enter the known values, review the units or settings, and the calculator updates the result instantly. The formula and example on this page show how the answer is produced.
What does the Lease vs Buy Car Calculator calculate?
Estimate Lease vs Buy Car totals, payments, rates, and costs for financial planning. It is designed for fast browser-based calculations without sign-up, downloads, or manual spreadsheet setup.
What formula does this lease vs buy car use?
The formula is: Total Cost Comparison = Σ(Lease Payments) vs. Σ(Loan Payments) − Resale Value at End. The comparison hinges on a factor pure monthly-payment comparisons miss: buying leaves you with an asset worth something at the end of the period, while leasing does not, so an apples-to-apples comparison must subtract the vehicle's residual resale value from the total cost of buying. This total-cost-of-ownership approach mirrors the same methodology accountants use to compare leasing versus purchasing equipment in a business context, just applied to a personal vehicle.
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Last updated: September 27, 2026.