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What is residual based financing?

Updated: 10/22/2022
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15y ago

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Residual based financing. I've never heard it worded like that, however being that I worked in the auto business and I understand financing it sounds like a Lease type of financing option. Monthly payments on a lease are determined by several factors one of which is the residual or (end) value of a vehicle taking mileage, condition and forecasted future value of the car into consideration.

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