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Lease vs Buy Car Calculator — Which Costs Less in 2026?
Should you lease or buy your next car? Leasing usually means a lower monthly payment and a new car every few years, while buying builds equity and is usually cheaper if you keep the car for five years or more. Enter your numbers below and this free calculator compares the total cost of leasing vs buying over the same period — monthly payments, total cash paid, equity left over, mileage fees and a clear verdict.
2026 US context: the average new vehicle sold for $50,562 in September 2026 (Kelley Blue Book / Cox Automotive), just $52 below the all-time record. The average new-car loan APR was 6.35% in Q2 2026 (Experian), with an average payment of $765 a month, while the average lease payment was $617 a month (Experian Q2 2026). Most leases run 36 months with 10,000–12,000 miles a year.
Lease vs Buy Calculator
The car & buying
Price before taxes and fees.
Average new-car APR was 6.35% in Q2 2026 (Experian); 7.0% per Edmunds Q3 2026.
Leasing
From your lease quote — it covers depreciation plus the finance charge.
First payment, fees and any cap-cost reduction. Paid again each time you start a new lease.
Typically $0.15–$0.30 per mile.
Comparison
3 years = one lease. Longer periods mean repeat leases vs one paid-off loan.
Rough guide: about 50% after 3 years, 35% after 6 years. This is your equity if you buy.
Buying
Leasing
Monthly payment
Total cash paid over period
Car value / equity at end
Remaining loan balance
— (you return the car)
Excess mileage fees
— (no limit)
Net cost (cash paid − equity)
How to Use This Calculator
Enter the car price — the negotiated price of the car you are considering, the same car for both sides so the comparison is fair.
Fill in the buying side — your down payment, the loan APR your lender quoted, and the loan term in months (60 months is the most common choice).
Fill in the leasing side — the monthly lease payment from the dealer quote, the lease term (usually 36 months), the amount due at signing, and your mileage.
Choose how many years to compare — 3 years for one lease cycle, or 5–6 years to see how buying pulls ahead once the loan is paid off.
Estimate the car's value at the end — this is your equity if you buy. About 50% of the price after 3 years and about 35% after 6 years is a reasonable starting point; adjust it for the make and model.
Click "Compare Lease vs Buy" and read the verdict. The lower net cost wins — net cost is total cash paid minus the equity you keep.
Worked Example
$35,000 car, $3,000 down, buy at 7% APR over 60 months, lease at $400/month for 36 months with $3,000 due at signing, compared over 3 years:
Buying: loan amount $32,000. Monthly payment $633.64. Total loan payments $38,018.30, plus $3,000 down = $41,018.30 over the full 60 months. After 36 months you have paid $25,810.98, the remaining loan balance is $14,152.38, and if the car is worth 50% ($17,500) your equity is $3,347.62 — so the net cost over 3 years is $22,463.36.
Leasing: $400 × 36 months + $3,000 due at signing = $17,400 over 3 years, with no equity at the end. Net cost $17,400.
Verdict over 3 years: leasing costs less — by about $5,063 in net cost — because the monthly payment is lower and you have not yet built much equity. Over 6 years the picture flips: buying's net cost is about $28,768 (loan paid off, car worth ~35%), while two back-to-back leases cost about $34,800. Buy if you keep cars a long time; lease if you want a new car every 3 years.
Lease vs Buy at a Glance
Factor
Leasing
Buying
Monthly payment
Lower (you pay depreciation only)
Higher (you pay the full price + interest)
Typical term
24–39 months, usually 36
60–72 months is now typical
Mileage
10,000–15,000 miles/year; $0.15–$0.30 per extra mile
Unlimited
Ownership
You return the car; no equity
You own it once the loan is paid off
Money factor
Lease interest rate as a decimal — multiply by 2,400 to get APR (e.g. 0.00250 = 6% APR)
APR quoted directly
Residual value
Typically 45%–60% of MSRP after 36 months
Your resale / trade-in value
Best for
New car every few years, low miles, lower payment
Keeping a car 5+ years, high miles, no payments later
Frequently Asked Questions
Is it cheaper to lease or buy a car in 2026?It depends on how long you keep the car. Leasing is usually cheaper over 3 years because monthly payments are lower — the average lease was $617 a month vs $765 for a loan in Q2 2026 (Experian). Buying is usually cheaper over 5 to 6 years because you build equity and stop paying once the loan is paid off.
What is a money factor on a car lease?The money factor is the lease equivalent of an interest rate, written as a small decimal such as 0.00250. Multiply it by 2,400 to get the APR — 0.00250 × 2,400 = 6% APR. Always ask the dealer for the money factor in writing so you can compare it with a loan APR.
How many miles can I drive on a lease?Most leases allow 10,000, 12,000 or 15,000 miles per year. Driving over the limit usually costs $0.15 to $0.30 per extra mile at lease end — for example, 3,000 extra miles a year over 3 years at $0.25 a mile is $2,250. If you drive 15,000+ miles a year, buying usually wins.
Do I own the car at the end of a lease?No. At the end of a lease you return the car, unless you buy it for its residual value. When you buy with a loan, you own the car outright once the loan is paid off — and that equity is what makes buying cheaper long-term.
What is residual value?Residual value is what the leasing company expects the car to be worth at the end of the lease, typically 45% to 60% of MSRP after 36 months. A higher residual value means lower lease payments, because you are only paying for the depreciation.
When does leasing make sense?Leasing makes sense if you want a new car every 2 to 3 years, drive under the mileage limit, want lower monthly payments and warranty cover, and do not mind never owning the car. It makes less sense if you drive a lot, want to modify the car, or plan to keep it for many years.
Disclaimer: This calculator gives estimates for comparison only and is not financial advice. Actual lease payments depend on the money factor, residual value, taxes and fees in your quote, and loan payments depend on your credit and lender. Taxes, registration, insurance and maintenance are not included. Check your dealer quote and loan offer before deciding.
Current as of November 2026. Average price: Kelley Blue Book / Cox Automotive, September 2026 ($50,562). Loan and lease averages: Experian State of the Automotive Finance Market, Q2 2026; Edmunds Q3 2026 financing data (average APR 7.0%).