LeasequotecheckIs this a good lease deal?
Enter the numbers from the dealer's quote and the payment they offered. You will see the interest rate hidden in that payment, fees you can push back on, and what the lease really costs each month.
The dealer's offer
$
Including tax, as on the quote.Ask the dealer, or look it up for your model and region. 0 if unknown.
The car
$
The sticker price; the residual is based on it.$
The negotiated price, also called the cap cost.$
Paint protection, nitrogen, etching.$
Lease terms
months
% of MSRP
$
$
Money down, fees and tax
$
$
$
$
%
What the quote really says
Rate in the payment5.93%Money factor 0.00247
True monthly cost$641All costs ÷ months
Due at signing$1,359
Total cost of the lease$23,069
- The payment implies a money factor of 0.00247 (5.93% APR), above the 0.00210 you entered as the lender's base rate. That marks up the interest by about $25.26 a month, $909 over the lease.
- The selling price is 6.0% below MSRP. The price is negotiable on a lease just as when you buy.
- Your true monthly cost is 1.53% of MSRP. A common rule of thumb calls a lease good at about 1% or less, though that is harder on some models.
Where the money goes
| Gross cap cost | $40,195 |
| Minus down payment, trade-in and rebates | $1,000 |
| Adjusted cap cost | $39,195 |
| Residual value (58% of MSRP) | $24,360 |
| Depreciation per month | $412.08 |
| Rent charge per month | $157.08 |
| Tax per month | $39.84 |
| Monthly payment | $609.00 |
Lease length 36 months. Disposition fee of $395 included in the total.
How a lease payment is built
Every lease payment has two parts:
- Depreciation: the selling price (plus fees rolled in, minus down payment and rebates) minus the residual value, spread over the months. You pay for the value of the car you use up.
- Rent charge: the lease's interest. It is the adjusted cap cost plus the residual, times the money factor. Multiply the money factor by 2,400 to get the equivalent APR.
Where tax is charged monthly, the tax rate is added on top of the two.
The four things to negotiate
- Selling price. It is negotiable, exactly as when you buy. Every 1,000 off lowers the payment by about 1,000 divided by the months.
- Money factor. Dealers can add to the lender's base rate. Ask for the base money factor and check it here.
- Add-ons. Paint protection, nitrogen and etching are often added without asking. They can be removed.
- Down payment. A large down payment only makes the monthly number look smaller; it does not make the lease cheaper.
Outside the US
In many countries, private leases are quoted as one all-in monthly price. You can still compare deals with the true monthly cost: add up everything you pay over the lease and divide by the months.