Leasing a new car, truck, or SUV is like renting a vehicle—but what is residual value? Residual value is the remaining value after depreciation at the end of your lease term. In other words, it is the amount you can purchase the vehicle when your lease is up. When you lease a new vehicle, you end up paying for the difference in original value and residual value. Think of it this way: the higher the residual value, the lower your monthly payments will be.

How is Residual Value Determined?

Determining the residual value starts by considering various factors and market conditions. Some of these factors can include the vehicle's reliability, safety, and resale value. Other factors, such as new technological features, can also affect the residual value. Keep in mind that the residual value changes over time.

Lease Your Next Vehicle from Prime Motor Group

At Prime Motor Group, our finance professionals are here to assist Massachusetts, Maine, New Hampshire, and Vermont drivers with all their leasing questions. Whether you have leased with us before or are considering it for the first time, you will have a transparent experience from start to finish.

Our finance team is here to discuss the residual value and other lease terms before you sign on the dotted line. And although the residual value isn't the only part of leasing, it’s important to understand the term. Please feel free to contact Prime Motor Group if you have any additional questions about residual value or leasing in general. We look forward to hearing from you soon.

Categories: Finance