CAR-BUYING QUESTIONS

What is capitalized cost in a lease?

Capitalized cost, or cap cost, is essentially the price of the car in a lease, plus any fees, taxes or products rolled in. The adjusted cap cost subtracts any cap cost reductions like a down payment, rebates or trade-in equity. The lower the adjusted cap cost, the lower your payment. Because cap cost is based on the vehicle price, you can negotiate it just as you would when buying.

General information, not legal or financial advice; rules vary by state and lender.

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