Lease Calculator · Practical guide
Money Factor to APR Conversion Chart
Multiply the money factor by 2,400 to get the equivalent APR — or find yours in the chart below.
At a glance
The Conversion
The money factor is the lease world's way of quoting an interest rate, and the conversion is one multiplication: APR = money factor x 2,400. A money factor of 0.00125 equals a 3% APR. Going the other way, divide the APR by 2,400.
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Lease Calculator
Enter your own values, then compare the result with the examples below.
Money Factor to APR Chart
| Money Factor | Equivalent APR |
|---|---|
| 0.00042 | 1.0% |
| 0.00083 | 2.0% |
| 0.00125 | 3.0% |
| 0.00167 | 4.0% |
| 0.00208 | 5.0% |
| 0.00250 | 6.0% |
| 0.00292 | 7.0% |
| 0.00333 | 8.0% |
Why the Number Looks So Small
Lease finance charges are computed on (cap cost + residual) each month, not on a declining loan balance, so the decimal form keeps the monthly math simple: charge = (cap cost + residual) x money factor. The 2,400 multiplier (12 months x 2, roughly) converts that convention back to a familiar annual percentage.
What the Rate Costs You
On a lease with a $31,000 cap cost and $22,000 residual, each 1% of APR (about 0.00042 of money factor) adds roughly $22 per month to the finance charge — about $800 over 36 months. Converting to APR before you sign tells you whether the lease rate competes with simply financing the car.
Watch for Markups
Dealers can mark up the lender's base money factor, just like loan rates. Ask for the "buy rate" from the leasing company, convert it with the chart above, and compare it to current auto loan APRs. Enter the money factor directly in the calculator above to see its full effect on your payment.
Frequently Asked Questions
What is a good money factor on a lease?
Convert it to APR and compare with current auto loan rates. A money factor at or below the loan APR you qualify for — say 0.00208 (5%) or less in a typical market — is competitive.
Can I negotiate the money factor?
Sometimes. The lender sets a base rate tied to your credit tier, but dealer markups on top of that base are often negotiable. Always ask what the lender's buy rate is.
Why do leases quote a money factor instead of an APR?
Federal disclosure rules for leases predate modern APR rules, and the money factor fits the lease payment formula directly. It is not inherently deceptive — just multiply by 2,400 to translate it.
Does the money factor affect the residual or depreciation?
No. It only sets the finance charge portion of the payment. Depreciation depends on the cap cost, residual, and term, independent of the rate.