CINCINNATI—Consumers may be in for a shock this year when find out their lease payments are higher than in years past.
With interest rates expected to rise in 2018 and used car prices continuing to fall due to rising supply, the only direction for lease payments to head is up, explained Swapalease.com.
The greater supply of high-quality used vehicles coming off-lease is more quickly driving down used values, sending lease residuals higher. And with interest rates headed the other way, the monthly balance sheet for some may be in trouble.
Swapalease.com conducted an analysis, taking into account a typical vehicle with an MSRP of $35,000, and found that on a 36-month lease—with a residual of 49% and an interest rate of 4%—consumers will pay $604.83 a month.
If residuals are stronger, at 50%, the same consumer would pay $595.69 a month.