Lease guides
A lease contract is written in terms most people meet once every three years and never get explained. Each of these covers one of them: what it means, whether you can negotiate it, and how much it actually costs you.
Money factor
A money factor is a lease interest rate in disguise. Multiply it by 2,400 to get the APR — and learn why the number your dealer quotes may not be the one the bank set.
Read →Residual value
Residual value is what the bank predicts your car will be worth at lease end, set as a percentage of MSRP. It is not negotiable, and it drives more of your payment than the interest rate does.
Read →Capitalized cost
Gross cap cost, adjusted cap cost, cap cost reduction — three pieces of jargon for concepts you already understand. Here is what each one means and which is negotiable.
Read →Effective monthly cost
A "$299 per month" lease with $4,000 due at signing costs $410 a month. Here is how to compare offers on a number that cannot be gamed.
Read →Security deposits
Some captive lenders let you prepay refundable deposits to buy down the money factor. The money comes back at lease end, and the savings can run past $1,000.
Read →Down payments
A capitalized cost reduction lowers your payment but buys you almost nothing — and if the car is stolen or totalled in month two, you may never see it again.
Read →Lease fees
Two fees bracket every lease: one to start it and one to end it. What they are for, what they typically cost, and which parts are negotiable.
Read →Mileage & wear
What overage actually costs, whether to buy miles up front, and how excess wear is assessed when you hand the car back.
Read →Lease buyout
Your contract fixes the price you can buy the car for. Whether that is a bargain depends on what the market did over three years — and sometimes it is worth thousands.
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