lease term and residual

335 oClock · 11-16-2011, 12:59 AM

I was curious as to is a higher residual better for a lease or a lower one, and in what case?

My residual is 64%;

can somebody explain to me the benefits / costs of having higher/lower residuals on a lease

thank you

VanillaEps · 11-16-2011, 05:39 AM

Higher residual means the car is "worth" more at the end of the lease. Which means less depreciation during term of lease. Which means lower payments.

A lower residual would make payments higher, but the car is worth less at the end of the lease term.

If you want to buy out the lease, you want a lower residual. If you just want to lease, you want a higher residual.

11-16-2011, 12:59 AM	#1
335 oClock MOE 214 Rep 2,530 Posts Drives: 2011 e92 335i 6MT Join Date: Jun 2011 Location: Los Angeles iTrader: (13)	lease term and residual I was curious as to is a higher residual better for a lease or a lower one, and in what case? My residual is 64%; can somebody explain to me the benefits / costs of having higher/lower residuals on a lease thank you __________________ Duke Dynamics//Evolution Racewerks//LTBMW *335 oClocks Project Build//Photo Shoot*
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11-16-2011, 05:39 AM	#2
VanillaEps New Member 0 Rep 11 Posts Drives: 2011 328xi Join Date: Nov 2011 Location: LI, NY iTrader: (0)	Higher residual means the car is "worth" more at the end of the lease. Which means less depreciation during term of lease. Which means lower payments. A lower residual would make payments higher, but the car is worth less at the end of the lease term. If you want to buy out the lease, you want a lower residual. If you just want to lease, you want a higher residual.
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