Chevy Lease Terms to Familiarize Yourself With

If you’re looking into leasing a vehicle for the first time, you probably have plenty of questions about how the process works. Put simply, a lease is like a long-term car rental, as you don’t own the vehicle but get to drive it for a designated period. Before signing a Chevy lease, it’s a good idea to learn about the terms you will encounter. The team at Lester Glenn Chevrolet of Freehold has put together this helpful glossary.

Term

The lease term is its length. Lease terms typically range between 24 months to as high as 60 months. It’s important to remember that generally the shorter the term, the higher the payments will be.

Money Factor

The money factor may sound a little confusing, but it’s actually fairly simple. On top of the lease payment, you will need to pay interest, and that interest is more commonly known as the money factor. This will be represented by a number that looks like this: 0.0025. You can multiply your money factor by 2,400 to determine what the interest rate would be – in this case, it’s six percent.

Cap Cost and Cap Cost Reduction

The cap cost is the total amount of money you will pay for the lease, which includes things like initial fees and maintenance plans. The cap cost reduction is anything that reduces the cap cost, like if you trade in a vehicle to put toward your lease.

Residual and Depreciation

At the beginning of the lease, the value of your car at the end of the lease will be calculated. This is known as the residual. The drop in value it will experience across the term of the lease is the depreciation.

Find Your Perfect Chevy Lease in Freehold, NJ

Now that you’re familiar with these terms, you can make smart decisions about your lease. If you have any questions or are interested in learning about our current Chevy lease offers, contact Lester Glenn Chevrolet of Freehold today!

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