How Much Will Car Lease Payments Be if I Only Know the Price of the Car?
If you’ve read some of the articles here on LeaseGuide.com, you know that car lease payments depend not only on price but on several other factors as well. However, price is the major and most important factor.
Clearly, if you know, or can guess, the other factors, you can use our Lease Payment Calculator to determine your monthly lease payment.
But what if you don’t know those other factors and simply want a ballpark lease payment number?
Here’s what you can do. It’s a simple two step process.
Step 1 – Estimate the final negotiated price of your car. If you know the MSRP sticker price, discount it by about 5% for an average car deal, assuming no rebates, or special dealer discounts. So, if the car has an MSRP of $30,000, subtract 5% ($1500) to get $28,500 as the price the lease will be based on. If you know there to be a rebate, make sure it can be applied to leases. Not all of them can. You can also go to a web site such as Car Deal Finder to find out what other people are paying for the same car that you want. Also remember to subtract any down payment you might make, which will reduce the price — and the monthly payment.
Step 2 – Multiply the price from Step 1 by .0173 to get your estimated monthly lease payment. For example, if we use the example price of $28,000 from Step 1, $28.000 multiplied by .0173 gets us $484.40 as our lease payment.
What we have assumed
To get to this very simplified method of determining car lease payments simply by knowing the price of the vehicle we have made some assumptions based on averages.
First, we assume the term of the lease is 36 months, which is average. Next, we assumed a lease-end residual value that is 50% of the vehicle price, which is average. Finally, we assumed an interest rate of 5.5%, which equates to a .0023 lease money factor, which is average.
Obviously, if a specific lease deal offers a larger price discount, a longer lease term, a higher residual value, and/or a lower money factor, the monthly payment will be less than that calculated by this simplified method.
Use our Lease Payment Calculator
If you need a more accurate and detailed lease payment calculation, use our Lease Calculator. If you don’t know all the numbers, make intelligent guesses and simply experiment to see how the numbers affect the final payment calculation.