Lease vs Buy Calculator - Car & Equipment Comparison
Compare the total cost of leasing versus buying a vehicle or piece of equipment over time.
Lease Details
$
Buy Details
$
$
$
Value at the end of the loan term, if sold
Total Lease Cost
$14,400
$400/month equivalent
Total Buy Cost (net of resale)
$27,000
$450/month equivalent
How Lease vs. Buy Is Calculated
This calculator compares the total cost of leasing a vehicle or piece of equipment against buying it outright with a loan. Enter the monthly lease payment and lease term, then the monthly loan payment, loan term, any down payment, and an optional estimated resale (residual) value if you buy and later sell it.
Total Buy Cost = Down Payment + (Monthly Loan Payment × Loan Term) − Estimated Resale Value
Since lease and loan terms are often different lengths, the calculator also shows a cost-per-month figure for each option, which is the fairer way to compare them side by side.
Example
Leasing a car at $400/month for 36 months costs $14,400 total ($400/month). Buying the same car with a $3,000 down payment, $600/month for 60 months, and an estimated $12,000 resale value at the end costs $3,000 + $36,000 − $12,000 = $27,000 total, or $450/month — in this example, leasing is cheaper on a monthly basis, though buying builds equity in an asset you keep.
Common Use Cases
- Deciding whether to lease or finance a new car.
- Comparing leasing vs. purchasing equipment for a business.
- Weighing lower monthly lease payments against long-term ownership costs.
- Estimating how resale value affects the true cost of buying.
FAQs
Does this account for mileage limits or lease-end fees?
No — this calculator focuses on the core payment comparison. Leases often include mileage limits, wear-and-tear charges, and disposition fees at the end of the term, which can add real cost beyond the monthly payment and should be factored in separately.
Why does buying show a cost even after subtracting resale value?
Buying still involves paying interest on the loan and the asset's natural depreciation — the resale value simply recovers part of what you paid, it doesn't erase financing costs or depreciation entirely.
Is leasing or buying always better?
Neither is universally better — leasing typically offers lower monthly payments and the option to upgrade more often, while buying builds ownership and equity over time and has no mileage or usage restrictions. The right choice depends on your budget, how long you plan to keep the vehicle or equipment, and how much you use it.