Quote:
Originally Posted by mr_chin
EDIT #2: Ignore the part about interest applied only to the money you borrow. I just dug out my lease papers from 6 years ago and calculated the interest. You pay interest on the money you borrow for the monthly payments and the residual value. Stupid how they charge you interest on money you didn't borrow. I didn't even know that and I signed the papers... FML.
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But you did borrow that money. There's nothing shady about the math of lease itself which is (depreciation+financing cost)/term.
TBH though, only 3 things matter in a car lease agreement: final negotiated price, interest rate and residual value. Everything else is derivative from these 3 numbers. Just focus on getting the first 2 as low as possible. For the residual, you want to get high as possible (usually fixed if dealing with manufacturer, but when you are comparing 2 different cars, it makes sense to see which one offers higher residual).