A down payment for a lease depends on several different factors. A
down payment for a lease is usually determined by a person's credit
score and/ or deals by the specific car manufacturer. A person can
generally get away with making a small or no downpayment when their
credit score is 700+.
A down payment of a lease is spent toward paying for the loss residual
of a vehicle. For instance if you were leasing a car that was 50,000
and the residual was 70% over a given period of 36 months. The value
of the car at the end of the lease would be 35,000. Residual is simply
the % value of the original amount of the car. In this case the loss
residual would be 15,000. If you divide this over 36 months (lease
period) the payments would be about 416 dollars a month. But if you
paid a 4,000 dollar down payment it would count towards the 15,000 and
you would only have to pay 11,000 over the 36 months or about 305 a
month.
A downpayment is really determined largely by your credit score. A
higher downpayment can offer you a lower monthly payment overall
because many Manufacturer such as BMW offer a program called cap cost
reductions. The higher amount down payment you pay, the lower interest
they charge you over the period of the lease.
Generally speaking, a lease payment can be any amount as long as your
credit score is solid. People decide to make down payments to lower
the overall monthly payments. |
