Auto Loan & Lease Calculator

Auto Loan & Lease Calculator

Compare the cost of financing versus leasing a vehicle in Canada.

E.g., Ontario HST 13%, Alberta GST 5% — adjust for your province
Monthly payment $0
Financing: uses a standard installment loan calculation (monthly compounding). Lease: uses the standard North American auto industry formula (depreciation fee + finance fee based on the money factor = APR/2400). Sales tax on lease contracts is calculated differently by province (some charge tax on each payment, others upfront on the full value) — this is a simplified estimate; confirm the exact figure with the dealership.
This tool provides estimates for general informational purposes only and does not constitute financial, insurance, tax, or legal advice. Actual figures may vary depending on your lender/insurer, individual circumstances, and current market conditions. InsureFiHub is not responsible for financial decisions made based on these results.

Financing and leasing a vehicle work very differently, and comparing them side by side isn't as simple as looking at the monthly payment alone. This calculator estimates your monthly cost either way — a standard installment loan for financing, or the industry-standard depreciation-plus-finance-fee formula for leasing — so you can compare them on equal footing.

How This Calculator Works

Financing uses a standard installment loan calculation with monthly compounding, applied to the vehicle price (plus tax) minus your down payment. Leasing uses the standard North American auto industry formula: a depreciation fee (based on the vehicle's expected residual value at lease-end) plus a finance fee calculated from the "money factor" (APR ÷ 2400). Sales tax treatment on leases varies by province — some charge tax on each monthly payment, others on the full vehicle value upfront — so this is a simplified estimate; confirm the exact figure with your dealership.

Frequently Asked Questions

Is it cheaper to lease or finance a car?

Leasing usually has a lower monthly payment because you're only paying for the vehicle's depreciation during the lease term, not its full value — but financing builds equity toward ownership, while a lease means starting over (or buying out the residual) at the end of the term.

What is a "money factor" in a lease?

It's the interest-rate equivalent used in lease pricing, expressed as a small decimal rather than a percentage. To compare it to a familiar APR, multiply the money factor by 2,400 — for example, a money factor of 0.00288 is roughly equivalent to a 6.9% APR.

What is residual value, and why does it matter for a lease?

Residual value is the vehicle's estimated worth at the end of the lease term, expressed as a percentage of its original price. A higher residual value means less depreciation to pay for during the lease, which lowers your monthly payment.

Does this calculator include sales tax?

Yes — for financing it's added to the amount you finance. For leasing, tax treatment varies significantly by province (some tax each payment, others tax the full value upfront), so treat the lease sales tax figure here as an estimate and confirm the exact method with your dealership.