Lease Money Factor Calculator

Multiply the money factor by 2400. For example, a money factor of 0.00125 equals 3% and 0.0025 equals 6%. The multiplier gives the conventional lease-rate equivalent before taxes and fees. It is a comparison tool, not the APR that must appear in a lease disclosure.

Divide the APR percent by 2400. A 3% APR is 3 divided by 2400, which equals 0.00125. A 4.8% APR is 4.8 divided by 2400, which equals 0.002. Switch this calculator to APR to money factor mode and it does the division for you.

The rent charge is the lease equivalent of loan interest. It is calculated monthly as the net cap cost plus the residual value, multiplied by the money factor. With a 31,695 cap cost, a 21,000 residual, and a 0.00125 money factor, the monthly rent charge is (31,695 plus 21,000) times 0.00125, or about 65.87.

Lower is better. Ask the lessor for the base money factor for your credit tier and compare the resulting rent charge and total lease cost. A marked-up factor raises cost, even if the sale price looks attractive.

A lease charges interest on the average outstanding balance over the term. The starting balance is the cap cost and the ending balance is the residual, so their average is half their sum. The money factor already bakes in a factor of 2 (it is half the per-period rate you would expect), which is why you multiply by the full sum rather than the average. The two factors of 2 cancel and the math comes out correct.

No. It is an estimate to help you compare lease quotes and check a dealer's numbers, not financial or tax advice. Your actual money factor, fees, and taxes come from the lessor and depend on your credit, the vehicle, and current programs. Confirm every figure on the signed lease agreement before you commit.