Convert money factor and APR
Type in either box. Dealers sometimes drop the decimals and say “2.5” or “250” for 0.00250; the converter recognizes those formats and shows how it read them.
Money factor to APR chart
| Money factor | APR | Money factor | APR | Money factor | APR |
|---|---|---|---|---|---|
| 0.00025 | 0.60% | 0.00225 | 5.40% | 0.00425 | 10.20% |
| 0.00050 | 1.20% | 0.00250 | 6.00% | 0.00450 | 10.80% |
| 0.00075 | 1.80% | 0.00275 | 6.60% | 0.00475 | 11.40% |
| 0.00100 | 2.40% | 0.00300 | 7.20% | 0.00500 | 12.00% |
| 0.00125 | 3.00% | 0.00325 | 7.80% | 0.00525 | 12.60% |
| 0.00150 | 3.60% | 0.00350 | 8.40% | 0.00550 | 13.20% |
| 0.00175 | 4.20% | 0.00375 | 9.00% | 0.00575 | 13.80% |
| 0.00200 | 4.80% | 0.00400 | 9.60% | 0.00600 | 14.40% |
Monthly lease payment
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How to convert money factor to APR
Money factor = APR (%) ÷ 2,400
0.00125 × 2,400 = 3.0% · 0.00200 × 2,400 = 4.8% · 0.00300 × 2,400 = 7.2%
5.4% ÷ 2,400 = 0.00225
If a quote says “money factor 2.25”, the dealer means 0.00225 and has dropped the leading zeros. Always ask for the full decimal, and convert it so you can compare it with loan rates.
Why multiply by 2,400?
A lease payment has two main parts. The depreciation fee repays the value the car loses. The rent charge is the lease's interest. Leasing companies calculate the rent charge like this:
Over a lease, your balance falls from the capitalized cost to the residual, so the average balance is about (cap cost + residual) ÷ 2. Interest on that average at an annual rate is balance × APR ÷ 12. Setting the two equal:
MF = APR ÷ 24 → with APR written as a percentage: MF = APR ÷ 2,400
How accurate is the ×2,400 rule?
The rule uses the average balance, so it's a close estimate rather than an exact rate. The lease tab also solves for the exact implied rate: the discount rate at which your payments plus the residual equal the capitalized cost, with payments due at the start of each month. Some examples:
| Lease | Money factor | MF × 2,400 | Exact implied APR |
|---|---|---|---|
| $40,000 MSRP, 36 mo, 58% residual | 0.00250 | 6.00% | 6.03% |
| $40,000 MSRP, 36 mo, 58% residual | 0.00100 | 2.40% | 2.41% |
| $50,000 MSRP, 36 mo, 55% residual | 0.00350 | 8.40% | 8.43% |
| $30,000 MSRP, 24 mo, 62% residual | 0.00200 | 4.80% | 4.84% |
| $60,000 MSRP, 39 mo, 56% residual | 0.00125 | 3.00% | 3.01% |
The rule is typically within a few hundredths of a percentage point of the exact rate, more than close enough to compare offers. Federal lease disclosure rules (Regulation M) don't require dealers to state an APR, which is why converting the money factor yourself matters.
How a lease payment is built
Residual value = MSRP × residual %
Depreciation = (net cap cost − residual) ÷ months
Rent charge = (net cap cost + residual) × money factor
Payment = (depreciation + rent charge) × (1 + sales tax)
With the calculator's defaults ($37,500 price, $995 fees, $2,000 down, 58% residual on a $40,000 MSRP, 36 months, MF 0.00250, 7% tax), the payment is $554.84 a month ($369.31 depreciation + $149.24 rent charge, plus tax). Switch to the Lease payment calculator tab to see each line.
Tips for comparing lease offers
- Ask for the “buy rate”. The lender sets a base money factor for your credit tier. Dealers may mark it up and keep the difference. A markup of 0.0004 adds about 1 percentage point of APR.
- Negotiate the price, not just the payment. Every $1,000 off the capitalized cost cuts both the depreciation and the rent charge.
- Be careful with big down payments. If the car is totaled early, gap coverage pays off the lease, but your down payment is usually lost. Many buyers keep the down payment small.
- Compare with buying. Convert the money factor to APR and compare it with an auto loan in our Loan Payment Calculator.
Frequently asked questions
What money factor equals 0% APR?
A money factor of 0 (sometimes advertised as “zero-percent lease”). You still pay depreciation, fees and tax.
Do multiple security deposits lower the money factor?
Some captive lenders lower the money factor by a set amount for each refundable security deposit you pay up front. Programs vary by brand and change often, so ask the dealer for the current terms.
Is the rent charge the same as interest?
It works like interest. The Consumer Leasing Act disclosure lists it as the “rent charge”, part of the total of payments.
How do I convert APR to money factor?
Divide the APR by 2,400. 3.6% ÷ 2,400 = 0.0015.
Sources and method
Last reviewed: September 27, 2026.
- Federal Reserve Board, Keys to Vehicle Leasing (consumer handbook on lease terms, capitalized cost, residual value and rent charge). federalreserve.gov
- Consumer Financial Protection Bureau, Regulation M (Consumer Leasing), 12 CFR Part 1013: lease disclosure requirements. consumerfinance.gov
The converter applies APR = MF × 2,400 exactly. The exact implied APR is found numerically. It's the monthly rate that makes the present value of the pre-tax payments (due at the start of each month) plus the residual equal the net capitalized cost, multiplied by 12. Lease tax rules vary by state; some states tax the full price up front instead of each payment. This is an estimate; your lease contract is the final word.
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