1. What is the Edmunds Lease Calculator?

The Edmunds Lease Calculator helps determine monthly lease payments for vehicles using the standard industry formula. It accounts for capitalized cost, residual value, lease term, and money factor.

2. How Does the Calculator Work?

The calculator uses the lease payment formula:

Where:

• \( Cap \) — Capitalized cost (vehicle price plus fees minus down payment)
• \( Residual \) — Estimated value at lease end
• \( Term \) — Lease duration in months
• \( Money\ Factor \) — Lease interest rate (decimal)

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

3. Importance of Lease Calculation

Details: Understanding lease payments helps consumers compare deals, budget effectively, and negotiate better terms with dealers.

4. Using the Calculator

Tips: Enter all values in USD. Money factor is typically provided by the dealer (divide APR by 2400 to convert to money factor).

5. Frequently Asked Questions (FAQ)

Q1: What's a good money factor?
A: Rates vary but generally below 0.0020 (equivalent to ~4.8% APR) is considered good.

Q2: How is residual value determined?
A: Set by leasing companies based on vehicle make/model, term, and mileage allowance.

Q3: What's included in capitalized cost?
A: Vehicle price plus fees (acquisition, documentation) minus down payment/trade-in.

Q4: Are taxes included?
A: This calculator shows pre-tax payment. Some states tax monthly payments; others tax full vehicle value.

Q5: How can I lower my payment?
A: Increase down payment, negotiate lower price, choose longer term, or find better money factor.