Lease vs Buy
Leasing = lower payments, new car every few years. Buying = higher upfront cost but you own it.
| Factor | Lease | Buy |
|---|---|---|
| Monthly Payment | Lower | Higher |
| Ownership | No | Yes |
| Mileage Limits | Yes | No |
| Long-term Cost | Higher | Lower |
How to Use This Lease vs Buy (Car) Calculator
Enter vehicle price, lease terms (monthly payment, term, residual buyout), and purchase terms (loan rate, term, down payment). The calculator compares total cost of leasing vs. buying.
Formula & How It Works
Lease Cost = Down Payment + (Monthly Γ Term) + Disposition Fee. Buy Cost = Down Payment + (Monthly Γ Term) + Insurance Difference β Residual Value at end.
Calculation Example
On a $35,000 car: Leasing 36 months at $460/mo = $16,560 total with no equity. Buying with $5K down at 5.5% for 60 months = $34,635 total but car is worth ~$18,000.
Expert Tips
Lease if you want lower payments and a new car every 3 years. Buy if you keep cars 7+ years β total ownership cost drops significantly after the loan is paid off.
Frequently Asked Questions
Is leasing a waste of money?
Not always. If you value new cars and drive under 15k miles/year, leasing can make sense. For long-term, buying is usually cheaper.
Can I negotiate a lease?
Yes. The selling price, money factor, and residual value can all be negotiated.
What happens at lease end?
Return the car, buy at residual value, or start a new lease. Watch for excess mileage and wear charges.