1. What is a 36 Month Car Lease?

A 36-month car lease is a three-year vehicle leasing agreement where you pay to use a car for this period without owning it. The monthly payment is calculated based on the car's capitalized cost, residual value, and money factor.

2. How Does the Calculator Work?

The calculator uses the standard lease formula:

Where:

• \( Cap \) — Capitalized cost (negotiated price of the vehicle)
• \( Residual \) — Estimated value of the car at lease end
• \( MF \) — Money factor (lease interest rate expressed as a decimal)
• 36 — Lease term in months

Explanation: The first part calculates depreciation cost, while the second part calculates the finance charge.

3. Importance of Lease Calculation

Details: Understanding your lease payment helps in budgeting and comparing different lease offers to get the best deal.

4. Using the Calculator

Tips: Enter the capitalized cost in USD, residual value in USD, and money factor as a decimal (e.g., 0.00125). All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is a good money factor?
A: Money factors typically range from 0.0010 to 0.0040. Lower is better - 0.00125 is roughly equivalent to 3% APR.

Q2: How is residual value determined?
A: The leasing company sets residual based on projected depreciation. Higher residuals mean lower payments.

Q3: Can I negotiate the capitalized cost?
A: Yes, this is the price you negotiate just like when buying a car. Lower cap cost means lower payments.

Q4: What's not included in this calculation?
A: Taxes, fees, and any down payment or trade-in credit would affect the actual payment.

Q5: Is 36 months a good lease term?
A: 36 months is common as it often matches warranty periods and provides a balance between payment size and flexibility.