H3 smart buy option or lease

[lexpro]

<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by baby_hummer:
<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">You guys need to be asking what the money factor is,price of the car after taxes and fees,and the residual is on the leases to determine if you are getting a deal or the shaft. </div></BLOCKQUOTE>

Dan: Can you explain the money factor in layman's terms?

[edited]
I just saw your other post explaining your personal financing. I then went to the GMAC website and worked through the SmartBuy example.

NOW, I get it.

Depending on the deal, you pay less up front. You may pay more on the back end if you decide to refinance the remaining amount. However, because the present value of money > future value of money, you're better off with that money now rather than later.

Question: are you accumulating equity with SmartBuy? </div></BLOCKQUOTE>
Sorry for the late response...money factor is amount you are paying the lease company for use of the car every month(profit)it can equate to it to an interest rate by multiplying it by 2.3,

My last lease i had a 48 month lease on a lexus sc430 and i traded with no negative equity on the 31st month...IMHO you can trade out usually your last year with no negative equity as long as the miles are avg and car has no paintwork or previous body damage(I traded my 05 SUT with 5k earlier this year and got 49k for it and bought another same equipment for 49k with zero miles so i zero'd out my miles and kept my payoff the same)Overall i dont care to accumulate equity in a depriciating asset...i would rather pay a fixed amount per month to drive what i want and not put my money in a car.