# Car Lease Calculator

> Computes a closed-end vehicle lease payment from the negotiated price, residual value, money factor (or APR) and term: the monthly depreciation, finance charge, base payment, payment with sales tax and the total cost of the lease.

- Calculator id: `car-lease` · Category: Finance (`finance`) · Tool name: `calculate_car_lease_payment`
- Canonical page: https://tttkmbb.com/finance/car-lease · This document: https://tttkmbb.com/finance/car-lease.md · JSON definition: https://tttkmbb.com/finance/car-lease.json

## Purpose

Computes a closed-end vehicle lease payment from the negotiated price, residual value, money factor (or APR) and term: the monthly depreciation, finance charge, base payment, payment with sales tax and the total cost of the lease.

**Use when:** You are evaluating a car lease offer and want to check the monthly payment or convert the money factor to an APR.

**Do not use when:** You are buying the car with a loan (use car-loan), or the lease is open-ended with a balloon purchase (different terms).

## Input

| Parameter | Type | Unit | Required | Description |
| --- | --- | --- | --- | --- |
| `msrp` | number |  | required | Manufacturer's suggested retail price; the residual value is a percentage of this. (> 0, max 10000000) |
| `negotiated_price` | number |  | required | Agreed selling price of the vehicle including any fees rolled into the lease. (> 0, max 10000000) |
| `residual_percent` | number | % of MSRP | required | Lessor's estimate of the vehicle's value at lease end as a percent of MSRP (typically 45–65 % for 36 months). (> 0, max 100) |
| `money_factor` | number |  | optional | Lease finance rate as a decimal (e.g. 0.00125). APR = money_factor × 2400. Takes precedence over apr_percent. (min 0, max 0.05) |
| `apr_percent` | number | % | optional | Alternative to money_factor: annual rate in percent (money_factor = apr_percent / 2400). (min 0, max 100) |
| `term_months` | integer | months | optional, default 36 | Lease length in months. (min 1, max 120) |
| `down_payment` | number |  | optional, default 0 | Cash or trade-in applied to reduce the capitalized cost. (min 0, max 10000000) |
| `sales_tax_percent` | number | % | optional, default 0 | Tax rate applied to each monthly payment (the usual US method; some states tax the full price up front). (min 0, max 30) |

## Output

| Field | Type | Unit | Description |
| --- | --- | --- | --- |
| `residual_value` | number |  | msrp × residual_percent / 100. |
| `adjusted_capitalized_cost` | number |  | negotiated_price − down_payment. |
| `monthly_depreciation` | number |  | (adjusted_capitalized_cost − residual_value) / term_months. |
| `monthly_finance_charge` | number |  | (adjusted_capitalized_cost + residual_value) × money_factor. |
| `base_monthly_payment` | number |  | monthly_depreciation + monthly_finance_charge. |
| `monthly_payment_with_tax` | number |  | base_monthly_payment × (1 + sales_tax_percent / 100). |
| `total_lease_cost` | number |  | monthly_payment_with_tax × term_months + down_payment. |
| `money_factor_used` | number |  | Money factor applied (given, or apr_percent / 2400). |
| `apr_equivalent_percent` | number | % | money_factor × 2400. |

## Formula

`residual_value = msrp × residual_percent/100; adjusted_cap_cost = negotiated_price − down_payment; monthly_depreciation = (adjusted_cap_cost − residual_value) / term_months; monthly_finance_charge = (adjusted_cap_cost + residual_value) × money_factor; base_payment = depreciation + finance charge; payment_with_tax = base_payment × (1 + sales_tax_percent/100); money_factor = apr_percent / 2400`

Standard US closed-end lease arithmetic (Federal Reserve Regulation M disclosures). Acquisition and disposition fees, security deposits and mileage charges are not included unless folded into negotiated_price.

## Data Sources

- Investopedia – Money Factor: Definition, Calculation and Example — https://www.investopedia.com/terms/m/money-factor.asp (reference, retrieved 2026-09-24)
- Federal Reserve – Keys to Vehicle Leasing — https://www.federalreserve.gov/pubs/leasing/ (government, retrieved 2026-09-24)
- Wikipedia – Vehicle leasing — https://en.wikipedia.org/wiki/Vehicle_leasing (reference, retrieved 2026-09-24)

Data freshness: `static`. Deterministic formula with fixed constants; results never go stale. Inputs supplied by the caller determine the output.

## API

- `GET https://tttkmbb.com/api/v1/calculate/car-lease?msrp=…&negotiated_price=…&residual_percent=…`
- `POST https://tttkmbb.com/api/v1/calculate/car-lease` with JSON body `{"inputs": {…}}`
- Response: unified envelope (`success`, `request`, `result.values`, `result.units`, `sources`, `freshness`, `timestamp`, `next_actions`, `links`); see https://tttkmbb.com/docs/response-format.md
- Schema: https://tttkmbb.com/api/v1/calculators/car-lease · OpenAPI operationId `calculate_car_lease_payment` in https://tttkmbb.com/openapi.json
- Authentication: none. Rate limit: fair use, see https://tttkmbb.com/docs/rate-limits.md.

## MCP

- Server: `https://tttkmbb.com/mcp` (Streamable HTTP, JSON-RPC 2.0, no auth)
- Tool:  `run_calculator` with `{"calculator_id": "car-lease", "inputs": {…}}`

## Example

- MSRP 30,000, price 27,000, residual 55 %, MF 0.00125, 36 months: inputs `{"msrp":30000,"negotiated_price":27000,"residual_percent":55,"money_factor":0.00125,"term_months":36}` → `{"residual_value":16500,"adjusted_capitalized_cost":27000,"monthly_depreciation":291.67,"monthly_finance_charge":54.38,"base_monthly_payment":346.04,"monthly_payment_with_tax":346.04,"total_lease_cost":12457.5,"apr_equivalent_percent":3}`
- MSRP 40,000, price 37,500, residual 60 %, 6 % APR, 2,000 down, 7 % tax: inputs `{"msrp":40000,"negotiated_price":37500,"residual_percent":60,"apr_percent":6,"term_months":36,"down_payment":2000,"sales_tax_percent":7}` → `{"residual_value":24000,"adjusted_capitalized_cost":35500,"monthly_depreciation":319.44,"monthly_finance_charge":148.75,"base_monthly_payment":468.19,"monthly_payment_with_tax":500.97,"total_lease_cost":20034.85,"money_factor_used":0.0025}`

```
GET https://tttkmbb.com/api/v1/calculate/car-lease?msrp=30000&negotiated_price=27000&residual_percent=55&money_factor=0.00125&term_months=36
```

## Limitations

You are buying the car with a loan (use car-loan), or the lease is open-ended with a balloon purchase (different terms). Standard US closed-end lease arithmetic (Federal Reserve Regulation M disclosures). Acquisition and disposition fees, security deposits and mileage charges are not included unless folded into negotiated_price. All values are computed from the formula above; no measurement or live data is involved.

## FAQ

**Why multiply the money factor by 2400?**

The finance charge is applied to the average of the capitalized cost and the residual, i.e. (cap + residual)/2, each month; folding the ½ and the 12 months into the rate gives APR = MF × 2 × 12 × 100 = MF × 2400.

**Is a bigger down payment a good idea on a lease?**

It lowers the payment one-for-one over the term but is lost if the car is totaled or stolen early, because gap coverage settles the lessor's balance, not your prepaid amount.

## Related

- [Car Loan Calculator](https://tttkmbb.com/finance/car-loan.md) — Payment and total cost of buying the same car with a loan.
- [Loan Payment Calculator](https://tttkmbb.com/finance/loan-payment.md) — Amortizing-loan payment for comparison.