1. What is Auto Lease Calculation?

The auto lease calculation determines your monthly payment when leasing a vehicle. It accounts for the vehicle's cost, residual value, lease term, and money factor (interest rate equivalent).

2. How Does the Calculator Work?

The calculator uses the standard lease equation:

Where:

• \( Cap \) — Capitalized cost of the vehicle (USD)
• \( Residual \) — Residual value at lease end (USD)
• \( Term \) — Lease duration (months)
• \( MF \) — Money factor (decimal)

Explanation: The equation calculates the monthly depreciation plus the finance charge based on the money factor.

3. Importance of Lease Calculation

Details: Understanding lease calculations helps you negotiate better terms, compare lease offers, and budget accurately for your vehicle expenses.

4. Using the Calculator

Tips: Enter all values in USD. Money factor is typically provided by the dealer (e.g., 0.00125). Residual is often expressed as a percentage of MSRP.

5. Frequently Asked Questions (FAQ)

Q1: What's a good money factor?
A: Money factors typically range from 0.0010 to 0.0040. Lower is better (0.00125 ≈ 3% APR).

Q2: How is residual value determined?
A: The leasing company sets residual based on expected depreciation, usually 50-60% of MSRP for 36 months.

Q3: Can I negotiate the money factor?
A: Some dealers may adjust it, but it's often tied to your credit score and manufacturer programs.

Q4: What's included in cap cost?
A: Vehicle price plus any fees or add-ons, minus down payment or trade-in value.

Q5: Are there other lease fees?
A: Yes, typically acquisition fee, disposition fee, and possibly security deposit not included in this calculation.