Estimate the monthly payment, total interest cost and total paid on a fully amortizing equipment lease or finance agreement.
This calculator estimates what a $1 buyout style lease, or any fully amortizing equipment finance agreement, costs over its term. Enter the equipment price, the implied annual rate, the term in years and any upfront fees. It uses the standard amortization formula: payment = P x r / (1 - (1 + r)^-n), where P is the amount financed, r is the monthly rate (annual rate divided by 12) and n is the number of monthly payments.
Worked example (illustrative, not a quote): finance $80,000 at 9% for 5 years. The monthly rate is 0.0075 and n is 60, so the payment is about $1,660. Over 60 months you pay roughly $99,600, which means about $19,600 in finance charges, plus $500 in fees.
Limits: a fair market value lease usually has lower payments because the lessor assumes a residual value at the end, and that structure is not modeled here. If a lessor quotes a money factor instead of a rate, multiply it by 2,400 for a rough annual percentage. Payments due in advance, sales tax financed into the payment, balloon payments and variable rates are not included. Treat the result as a planning number and compare it with written quotes.
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