Loan vs Lease Calculator
Trying to decide whether to buy or lease a vehicle? Enter the loan and lease details and compare what you'll actually spend over the same period. Includes resale value for buying and buyout option for leasing.
How to use
- Enter the vehicle price, your down payment, loan interest rate, and loan tenure.
- Enter the monthly lease payment and lease term.
- Add the estimated resale value if buying, or lease-end buyout if leasing - these affect the real total cost.
- Click Calculate to see side-by-side totals for both options.
Related tools:
Leasing versus buying on a loan come down to a few key differences. When you lease, you pay for the depreciation during the lease period plus a finance charge - you get lower monthly payments but own nothing at the end. When you buy on a loan, you build equity as you repay, and own the asset outright at the end of the term.
For cars, leasing makes sense if you prefer driving a new model every 3 years, drive under the mileage limit, and do not want maintenance hassles. Buying makes sense for high-mileage drivers, people who keep vehicles long-term, or anyone who wants to avoid the perpetual payment cycle. The calculator compares total out-of-pocket costs over a given period for both options.
Frequently Asked Questions
What are the downsides of leasing?
Mileage limits (typically 10,000-15,000 miles or 20,000-25,000 km per year) with per-km penalties for overages. You cannot modify the vehicle. At end of lease you have no asset. Early termination is expensive. Over a 10+ year horizon, leasing almost always costs more total than buying.
What costs are typically excluded from lease payments?
Insurance (required but separate), maintenance beyond what the lease includes, excess mileage charges, and the disposition fee at end of lease. Add these to get the true monthly cost of leasing for comparison.
Does buying with a loan ever cost less than leasing?
Yes, over the long run. If you keep a purchased car for 7-10 years, your cost per year drops sharply once the loan is paid off. Leasing means you are always paying. Over a 10-year period, buying and holding typically costs significantly less than 3 consecutive lease cycles.