Enter the total annual percentage rate into the calculator to determine the equivalent money factor.

## Money Factor Formula

The following formula is used to calculate a money factor.

MF = APR / 2400

- Where MF is the money factor
- APR is the annual percentage rate

## Money Factor Definition

Money factor refers to the cost of financing a lease or loan for a vehicle. It is essentially the interest rate applied to the amount being financed. Money factor is important because it directly affects the monthly payment and overall cost of borrowing money for a vehicle.

A lower money factor means lower monthly payments and less interest paid over the life of the lease or loan. It is a crucial factor to consider when negotiating lease or loan terms, as a lower money factor can save a significant amount of money in the long run.

## Money Factor Example

How to calculate a money factor/lease factor?

**First, determine the APR.**Calculate the annual percentage rate of the lease or loan.

**Next, calculate the money factor.**Use the equation above to determine the money factor/lease factor.

## FAQ

**What is a lease factor?**

A lease factor, also known as a money factor, is a me