A lease vs buy car calculator cuts through the monthly payment comparison to reveal the true total cost of each option. Dealers often emphasize low lease payments, but buying typically costs less over the long run. This tool shows you the full picture.
How to Use This Calculator
- For leasing: Enter monthly lease payment, lease term, down payment, acquisition fee, and disposition fee.
- For buying: Enter purchase price, down payment, loan rate, loan term, and expected resale value.
- Enter expected mileage per year and any excess mileage fees for the lease.
- Click Calculate to see total cost of leasing vs. buying over the comparison period.
What This Calculator Measures
- Total lease cost — Sum of all payments, fees, down payment, and potential mileage overages.
- Total buy cost — Purchase price minus residual (resale) value, plus all financing interest.
- Cost difference — How much more or less you spend with each option.
- Equity built — The net asset value you retain when buying vs. nothing when leasing.
Formula or Logic
Total Lease Cost = Down Payment + (Monthly Payment × Lease Term) + Acquisition Fee + Disposition Fee + Excess Mileage Charges
Total Buy Cost = Down Payment + (Monthly Payment × Loan Term) + Total Interest − Estimated Resale Value
Example Calculations
Example 1: Lease: $299/month × 36 months + $2,000 down + $895 fees = $13,659 total. Buy: $35,000 car, $5,000 down, 5% rate 60 months, resale at $18,000 → Net cost = $22,480. Leasing cheaper over 3 years; buying better long-term.
Example 2: High-mileage driver (20,000 mi/year) leasing at $0.25/mile overage on a 12,000-mile lease pays $2,000/year extra → leasing becomes far more expensive.
Understanding Your Results
Leasing wins for short-term flexibility, lower monthly payments, and driving new cars frequently. Buying wins for long-term ownership costs, no mileage limits, and building equity. If you keep cars for 6+ years, buying almost always wins financially.
Common Mistakes to Avoid
- Comparing lease payment vs. loan payment — always compare total cost over the same time horizon.
- Ignoring lease-end fees (disposition fee, wear-and-tear charges, excess mileage).
- Not factoring in the resale value when calculating net cost of buying.
- Leasing when you drive significantly more than the allowed annual mileage.