This lease vs buy calculator compares the estimated total cost of leasing a vehicle versus financing a purchase.
Leasing typically offers lower monthly payments, while buying builds equity and long-term ownership value. Understanding both options helps you make a financially informed decision.
Want a Lower Monthly Payment?
Your interest rate is based on your credit score— and even a small improvement could save you $100-$300 per month and thousands over the life of your loan. Most buyers overpay because they don’t check their credit score. Check your credit score before you apply.
Leasing Pros and Cons
Pros:
- Lower monthly payments
- Lower upfront costs
- Drive newer vehicles more often
Cons:
- Mileage limits
- No ownership equity
- Possible wear-and-tear fees
Buying Pros and Cons
Pros:
- Full ownership
- No mileage restrictions
- Long-term cost savings
Cons:
- Higher monthly payments
- Depreciation risk
How to Decide
Leasing may make sense if you prefer driving new cars every few years and stay within mileage limits.
Buying may be better if you plan to keep your vehicle long term and want to build ownership value.
Frequently Asked Questions About Leasing vs Buying a Car
Is leasing cheaper than buying?
Leasing often results in lower monthly payments but does not build ownership equity. Buying typically costs more monthly but provides long-term ownership value.
When does leasing make sense?
Leasing may make sense if you prefer driving a new vehicle every few years, drive fewer miles annually, and want lower monthly payments.
Do you build equity when leasing?
No. Lease payments cover vehicle depreciation and usage but do not build ownership equity.
What happens at the end of a lease?
At lease end, you may return the vehicle, purchase it at a predetermined price, or lease a new vehicle.
Which option is better long term?
Buying is often better long term if you plan to keep the vehicle for many years. Leasing may cost more over time if repeated continuously.