Finance Tools
Equipment Lease APR Equivalent Calculator
Convert equipment lease payments into an equivalent APR to compare leasing versus loan financing on an apples-to-apples basis.
Equipment Lease APR Equivalent Calculator
Translate lease payments into an equivalent APR to compare leasing with traditional loan financing.
Set to 0 if the equipment is returned at lease end.
Equivalent APR
8.60%
This is the implied annual interest rate of the lease, useful for comparing against loan APRs.
How it works
- Models the lease as a series of cash flows.
- Uses an IRR-style calculation to solve for APR.
- Accounts for buyout value and upfront fees.
FAQ
Is this the same as the lease money factor?
No. Money factor is a leasing shorthand; APR equivalent translates it into a standard interest rate.
How to use this equipment lease apr equivalent calculator
- Enter the equipment price and lease term.
- Input the monthly lease payment and upfront fees.
- Add the lease-end buyout value if applicable.
- Review the equivalent APR implied by the lease.
Example
Example:
- Equipment price: $80,000
- Lease: $1,450/month for 48 months
- Buyout: $30,000
- Equivalent APR: ~9.2%
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