Car Lease vs Buy Total Cost Method, Formula & Examples

Calculation sequence

Lease cost sums signing cash, monthly payments and entered end charges. Buy cost sums down payment, payments and cash fees, adds the remaining loan payoff, then subtracts estimated resale value.

Inputs and evidence

Use current written documents for every material input. The calculator supports: Market and currency, Common comparison horizon, Lease cash due at signing, Lease monthly payment, Lease disposition and expected end fees, Expected excess-mileage and wear cost, Purchase out-the-door price, Purchase down payment, Purchase annual rate, Purchase loan term, Purchase cash fees not in price, Estimated vehicle value at horizon.

Reference example

Over 36 months, a lease costing 3,000 upfront plus 400 monthly and 600 at return totals 18,000. A zero-rate purchase with 10,000 equity at that horizon has a modeled net cost of 14,000.

Boundary and error checks

Test zero-rate branches where available, minimum and maximum supported inputs, and a scenario in which the main result reverses. Reject blank, non-finite or out-of-range values rather than silently substituting them.

Model boundary

The model excludes tax rules not already in entered payments, opportunity cost, maintenance differences, insurance, incentives, early termination, lease buyout financing and market-value uncertainty.

Sources and review status

• CFPB — Take control of your auto loan
• FTC — Financing or leasing a car
• Financial Consumer Agency of Canada — Financing a car

Sources and model boundaries checked 2026-10-08. CalculatorGeek Editorial Team verified this page for publication on 2026-10-16. Existing formulas, source dates, model boundaries, and professional-advice limitations remain in force.