With no down payment and lower monthly payments, you have more cash to do other things with. Leasing is a service, and like any other service, the experience dedication and professionalism determine the overall quality of the service provided. We do not try to sell you a particular vehicle, we want you to have all the information in order for you to select the right vehicle. The lessee is the person or party signing the contract and taking responsibility for the vehicle and lease payments. The lessor is the business, manufacturer or the financial institution that owns the vehicle and provides the vehicle and lease.
Residual value is the forecast value of the vehicle at the end of the lease term.
Residual value is used to calculate the lease payments by establishing the depreciation in the lease. Capitalized cost less residual value equals depreciation. The vast majority of leases available to consumers are closed-end. With this type of agreement, the leasing company absorbs the loss if the vehicle is worth less than the estimated residual value. This means that if at the end of the lease period the vehicle is worth less than the residual value stated in the lease, you don't have to take any loss.