Lease Offer Evaluator

A lease payment is built from depreciation (selling price minus residual, spread over the term) plus a rent charge (the money factor applied to the price and residual). To compare leases fairly, look at the effective monthly — total lease cost divided by the term — and the total cost, never the advertised payment alone, which can hide a large amount due at signing.

Why the advertised payment misleads

A low monthly payment often means a big due-at-signing amount, a short term, or a low mileage allowance. The effective monthly (total cost ÷ term) spreads the upfront money back in so two leases can be compared honestly.

The numbers that actually drive a lease

·Selling price — negotiable, just like a purchase
·Residual — the car's value at lease end (set by the leasing bank)
·Money factor — the lease's interest rate (× 2400 ≈ APR)
·Term and mileage allowance — shorter terms and lower miles raise cost per month
·Due at signing — spread this back across the term to compare fairly

What to negotiate

You can negotiate the selling price and question fees. The residual and money factor are set by the leasing bank, but knowing them lets you spot a marked-up money factor.

How this is calculated

·Residual = MSRP × residual %. Adjusted cap cost = selling price − cap-cost reduction.
·Monthly depreciation = (adjusted cap cost − residual) ÷ term.
·Monthly rent charge = (adjusted cap cost + residual) × money factor.
·Effective monthly = (due at signing + all payments) ÷ term — the apples-to-apples figure.

Limitations

·Excludes lease taxes (which vary by state) and any wear/mileage charges at lease end.
·Residual and money factor come from the leasing bank; enter the actual figures from your quote.
·An estimate for comparison — your signed lease governs the exact numbers.

Frequently asked

How do I compare two lease offers?

Compute each lease's effective monthly (total cost including due-at-signing, divided by the term) and its total cost. Comparing advertised payments alone is misleading.

What is a money factor?

The lease's interest rate in decimal form. Multiply it by 2400 to approximate the APR — e.g. 0.00125 ≈ 3%.

Is the selling price negotiable on a lease?

Yes. The selling price (capitalized cost) is negotiable just like a purchase; a lower selling price lowers both depreciation and the rent charge.

Related guides & tools

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By the AsAgreed Editorial Team. Last reviewed July 2026. Estimates only — exact taxes, fees, and market conditions vary. Editorial standards.