Any car Salesmen out there?
When leasing a new car is the amortization schedule applied to the MSRP, or negotiated price? Do different lenders follow different amortization schedules? Standard should be 20% for year one and then 10% for each following year...meaning a 3 year lease would be a residual car value of 60% of either the MSRP or negotiated price...
There is no true residual value for all cars after three years. All makes, models and even trim levels can depreciate at different rates. Residual values are educated guesses by the banks of a vehicle's value at the end of the lease. On top of that, Bank A can have a different residual thank Bank B. Any overestimation in value can be made up in rent charge throughout the lease to soften the blow at lease end. It's not an exact science which is why different banks can provide different numbers.
Residual value is always based on msrp, not selling price.