Quote:
Originally Posted by lllwlf
Doing some modeling- quick question- For the MSD's, how many/ how do you determine the # of deposits and the amount of each deposit?
|
Each MSD is equal to one monthly payment (total including tax) on your lease rounded up to the nearest $50.
Each MSD reduces your MF by 0.00007
Maximum of 7 MSD per lease.
You determine how many just based on how much you want to put forward / tie up for the term of the lease, for what rate reduction, within the maximum confines above.
So for a $1000 monthly payment lease, you can reduce your MF by 0.00049 by putting $7000 (7 MSD @ $1000 each).
Edit: To get normal human interest rate percentage from the money factor (MF), just multiply by 2400. So your maximum rate reduction is 1.176% ( this is the reduction of interest rate for the life of the lease, it really is a great deal! )