Car Lease vs Buy Calculator
Leasing has a lower payment; buying builds equity. Compare the real cost of both over the same period, including down payments, fees, interest and what the car is worth at the end.
Lease
Buy
Cheaper over the lease term
How to compare leasing and buying
- Enter the lease offer: monthly payment, term and amount due at signing, plus any end-of-lease fees.
- Enter the purchase price (including tax and fees), down payment and loan terms.
- Estimate what the car will be worth at the end of the lease term. Many cars keep 50–60% of their value after three years.
How the comparison works
Leasing cost is simple: everything you pay over the lease (due at signing, monthly payments and end-of-lease fees), after which you hand the car back. Buying is compared over the same period: your down payment and loan payments, minus the equity you own at the end (the car's value minus what you still owe).
Leasing often wins over short periods for people who want a new car every few years and drive within the mileage limit. Buying usually wins when you keep a car for many years, because the payments end and the car keeps its value. Excess mileage and wear charges can make a lease much more expensive, so be realistic about how much you drive.
This comparison ignores insurance differences and opportunity cost of the cash you put down. Use our auto loan calculator for the full purchase picture, including trade-in and sales tax.
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Frequently asked questions
Is it better to lease or buy?
Buying is usually cheaper long-term if you keep the car for years. Leasing can make sense if you want a new car often and drive under the mileage cap.
What is a residual value?
The car's predicted value at the end of the lease, set by the leasing company. It determines much of the lease payment.
What fees come with a lease?
Typically an acquisition fee at signing, a disposition fee at the end, and charges for excess miles or wear.
Does this include insurance?
No. Leases often require higher coverage limits, which can add to the cost.