Here are the mechanics of how to calculate your own lease, without a lease calculator. Understanding the formula comes in handy when you are at the dealership and do not have access to internet or a computer with a lease calculator. It’s pretty useful if you want to cross-check the dealers math.
What you need:
- MF: The Money Factor. (You can find out what your interest rate is by multiplying the money factor by 2400)
- RV: Residual Value. What the car is worth at lease-end.
- CC: The Capitalized Cost AKA Sale Price.
- LST: Local Sales Tax.
- M: Term of the lease (24,36,48,etc)
I am going use the latest quote I got for the G37 I was shopping for as an example.
Step 1: Monthly Depreciation Charge
(CC – RV) / M
(32,916 – 22,185) = 10,731 / 36 = $298.08
Step 2: Monthly Finance Charge
(CC + RV) * MF
(32,916 + 22,185) = 55,101 * 0.00186 = $102.49
Step 3: Total Monthly Charge (plus tax)
(Monthly Depreciation Charge + Monthly Finance Charge) * LST
(298.08+102.49) = 400.57 * 1.0825 (8.25% tax) = $433.62
The actual quote I got is $453 a month. Why the $20 difference? Because they rolled in the Acquisition fee (bank fee) of $595 into the Cap Cost of the car. So keep that in mind next time you lease. Its probably better to pay that upfront. Otherwise, that $595 ends up costing $720 after all is said and done.



Thanks G
It’d be hard to enjoy the car if I’d been ripped off.
Hi, Can you publish the 12K/15K mile and 39 month numbers for G37 Sport Sedan and G37 Sedan Anniversary Edition?
Sorry, meant to request publishing the 12K and 10K mile numbers for the 39 month term. Thanks in advance.
Here’s the deal I just closed last week (thanks mostly to your website!)
2010 Honda Accord EX-L V6 w/ Nav
36-month | 12k miles | residual 52% | .00121 base money factor
MSRP: $31,855
Sale Price: $27,242
Gross Cap Cost: $27,242 + $595 Acquisition Fee = $27,837
Monthly: $387 including tax (5.6% sales tax Milwaukee, WI)
Due at signing: $703, which includes $387 (1st month’s payment) + $316 ($7 tax, $95 License, $69 Title, $125 dealer service fee, $20 wheel tax)
Lease Rating = 1.18 (Good = 1.10 – 1.25)
Thoughts? Pay the acquisition fee upfront to slightly lower monthly payment but more out of pocket. Can this fee be waived? Same with dealer service fee and wheel tax — negotiable? I think now I could have had them sweeten the deal with Honda’s protection package (all-season floor mats, cargo tray, wheel locks). But it’s a lease – who cares. Honda offers a $1500 excessive wear and use policy, no disposition fees and gap insurance.
Keep in mind, this was my first lease ever. Thanks for all the help.
G ~ is this a good deal? I cannot find any published lease rates for the 2011 Q5 models yet. Will rates change in August? Is it true that the lease rate goes down if I pay the security deposit?
MSRP $41,550
2011 Q5 2.0T (Quartz gray) with Premium Plus and 19″ wheels
48 month/15k mile lease
Cap Cost – $40,502
MF – .00229 (seems very high to me)
Residual – 42%
Total out of pocket at lease signing – $1,897 (taxes, fees, etc…)
Monthly Payment – $667 (including tax)
Is the rate of .00007 correct for the SLK300?
I have used this site (and boasted about great deals before. I am looking to move out of my 2009 BMW 328i lease with 22 months and ~24,000 miles left. Price is firm at my cost of $593/month. Please post on this site if you want me to contact you.
-Brian
I have a C300 that terms in 3 months. Do they usually charge an inception fee if I want to lease another MB, and if so, what fees would normally be charged by MB?
radtrax. what you see is what I have. my posts get updated sometimes if i find more.
I would normally recommend paying the acquisition and 1st month payment upfront. the only exception is when your money factor is relatively low and you can afford to roll in your fees and do a 0$ drive-off deal. As far as the fees are concerned, any fee that is state imposed, you can’t waive. Any fee that is bank imposed isn’t negotiable either. Usually, the only fee that can be negotiated is the dealer documentation fee. However, nowadays, dealers aren’t as willing to waive it. I think you did fairly well on your deal, you got a nice discount off the MSRP. I too love Honda/Acura’s lease programs because they are the best in the business. The damage waiver, the credit you get for being under miles (which can be passed on to your next Honda/Acura lease), no disposition, etc…you just can’t go wrong.
boltsfan, since i don’t have the 2011 q5 numbers, i can’t comment on the validity. But since you got them from your dealer, I would say they aren’t too far off. The Q5 doesn’t lease well at all. It never really has (since it’s introduction), so expect to pay more than comparable models from other brands. With that said, I think the money factor is really killing you right there. At 0.00229 x 2400 gives you an APR of around 5.472%. Ouch. If I were you, I would look for something else. The MF ins’t good and your sale price is even worse. If you aren’t in a hurry, I would recommend giving it a few months to see if the holiday season will include some more attractive lease rates and possible rebates.
BT. the residual doesn’t look wrong to me. MBZ does occasionally introduce super-low MFs. This isn’t out of character, specially when they are trying to liquidate remaining 2010 models.
As for your inception fee question….Inception fee isn’t really one fee. It’s a group of fees you pay before taking delivery of your car. It generally includes your 1st month payment, dealer documentation fee, bank acquisition fee, dmv fees, state fees/taxes. MB doesn’t discount on any of them because the only thing they can control is the bank acquisition fee (which they don’t ever waive). Dealer doc fee generally is charged, but some folks have been able to get it waive. The rest of the fees can’t be waive because they are state imposed. Now, the disposition fee (which is your turn-in fee) generally gets waived when you lease another MB.
Wow that didn’t take long. Are you looking to get something new Brian?
Thanks G – he’re is what I was given for an Anniversary Ed Sedan
Term: 39 month
Miles: 10K
Residual: 59%
MF: .000121