Finance & Investment

Car Loan & Lease Calculator

Monthly car loan payment vs. lease payment and total cost.

KRW
%

Monthly payment

1,093,559원

Financed principal36,000,000 원
Total interest3,368,124 원
Total paid (incl. down payment)43,368,124 원

This is a reference estimate. Rates and residual values vary by lender and vehicle, so confirm with an actual quote.

View repayment schedule
Month Principal Interest Balance
What's the difference between a car loan and a lease

An installment loan finances the vehicle price minus your down payment and repays it monthly with equal total payments (principal + interest). Ownership transfers to you immediately at signing.

A lease is closer to renting. You pay a monthly fee covering the vehicle's expected depreciation (price minus projected residual value) over the term. At maturity you can pay the residual value to buy the car, or return it and get your deposit back. During the term, the lessor usually holds title.

How it's calculated

Let r be the monthly rate (annual rate ÷ 12 ÷ 100) and n the number of months.

  • Loan (equal payments): Financed principal = price − down payment. Monthly payment = principal × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1); if r = 0, principal ÷ n.
  • Lease: Monthly payment = [(price − deposit) − (residual value − deposit) × (1+r)⁻ⁿ] × r ÷ (1 − (1+r)⁻ⁿ). The deposit is refunded or applied to the buyout at maturity, so the lessor recovers the residual value minus the deposit; its present value is deducted in an equal-payment structure.

The total buyout cost at maturity is total lease payments + residual value. Because the deposit is assumed to be applied toward the buyout price, it cancels out of the final total.

Loan vs. lease comparison
Key differences between a loan and a lease
AspectLoanLease
OwnershipYours immediately at signingLessor's during the term (transfers on buyout)
Upfront costDown payment (usually 10–30% of price)Deposit (refunded on return)
Monthly paymentPrincipal + interestDepreciation (net of residual) + interest
Total costUsually lowest (interest on principal only)Can rise if you buy out, since residual value is added
Tax and insurancePaid by the ownerUsually by the user, per contract
Rates and residual values vary widely by lender and vehicle even under similar conditions. Always confirm against an actual quote before signing.
Worked example (40,000,000 KRW vehicle, 36 months)

Example 1. Loan — 40,000,000 KRW vehicle, 10% down payment (4,000,000 KRW), 5.9% annual rate, 36 months, equal payments.

  • Financed principal = 40,000,000 − 4,000,000 = 36,000,000 KRW
  • Monthly payment ≈ 1,093,559 KRW
  • Total interest 3,368,124 KRW, total paid including down payment 43,368,124 KRW

Example 2. Lease — same price and term, 30% deposit (12,000,000 KRW), 50% residual value (20,000,000 KRW), 6.5% annual rate.

  • Monthly payment ≈ 656,313 KRW, total lease payments 23,627,268 KRW
  • Total buyout cost at maturity = total lease payments + residual value = 43,627,268 KRW
  • Total cost if returned 23,627,268 KRW (the 12,000,000 KRW deposit is refunded separately)

Under the same conditions, a lease you plan to return has the lowest total cost, while a loan gives you immediate ownership at the highest total cost.

At lease-end: return or buy out

If you plan to keep driving the car, buying out is often better: your deposit is applied toward the purchase, and you avoid the upfront costs (registration, taxes) of a new contract.

If you plan to switch cars every few years, returning is simpler: you hand back the vehicle at no extra cost and get your deposit back before starting a new contract. Check the contract's mileage and condition limits beforehand, since exceeding them can trigger penalty fees.

Which is better, a car loan or a lease?
Looking at total cost alone, a loan is usually cheaper: you only pay interest on the principal, while a lease bakes the residual value into the payment structure, so buying out at the end can raise the total cost. Still, a lease can make sense if you want a lower upfront cost, need lease-related tax benefits as a business, or plan to switch vehicles in a few years.
What is a lease's residual value?
The residual value is the vehicle's expected worth at the end of the lease term. The lessor recovers only the price minus this residual value as the usage fee, so a higher residual percentage lowers the monthly payment but requires a larger extra payment if you buy out at maturity.
At lease-end, should I return the car or buy it out?
Returning it means handing the car back at no extra cost and getting your deposit refunded. Buying it out means paying the residual value on top to take ownership, with the deposit typically applied toward that payment. Buying out tends to make sense if you'll keep driving the car; returning is simpler if you plan to switch to a new vehicle.
Does this calculator match an actual lender or lessor quote?
This calculator applies the standard equal-payment loan formula and a standard lease-payment formula as a reference estimate. Actual quotes can differ due to credit-based preferential rates, promotions, and extra costs like registration and insurance.
Does a bigger down payment lower the total cost?
Yes. A larger down payment reduces the financed principal, which lowers the interest you pay each month. That said, the down payment is still your own money paid upfront, so how much you actually save depends on the interest rate — the higher the rate, the bigger the effect of increasing the down payment.