Collect cash due, payments, balances and end charges
- Lease due-at-signing, payment and end-charge terms
- Purchase down payment and loan payment
- Estimated loan balance at the comparison date
- Conservative vehicle-value scenarios at the same date
Make both paths end on the same month
Use the same number of months.
Add realistic lease-end charges.
Stress-test vehicle value and loan balance.
Stress the purchase value and lease return cost
Compare lease and purchase over the same 36 months
Set one time horizon, then enter all lease cash out and the purchase cash out over those same months. For the purchase side, subtract estimated equity only after testing a lower vehicle value. Add mileage, wear, disposition or maintenance differences when they apply to the actual offers.
Read cash out separately from estimated equity
The difference is scenario-dependent; ownership equity is not guaranteed sale proceeds.
Lease vs. Buy a Car: Compare the Same Time Horizon covers the controlling document terms and questions outside this result.
Differences that need a separate adjustment
- Tax differences
- Insurance and maintenance differences
- Opportunity cost
The matched-horizon lease and purchase test
Compare lease cash out with purchase cash out less estimated equity.