Loans & Debt
Finance (rent) charge
Interest on the average outstanding balance of price and residual.
The Formula
Fin = (price + residual) x moneyFactor
Interest on the average outstanding balance of price and residual.
| Symbol | Meaning | Unit | Notes |
|---|---|---|---|
| MF | Money factor | rate | Interest rate divided by 2400. |
What Each Symbol Means
MFrate
Money factor
Interest rate divided by 2400.
See It Worked With Real Numbers
A formula on its own does not tell you which number goes where. The how to calculate a car lease payment page applies this equation to a concrete case, shows every intermediate step, and names the mistakes that produce a wrong answer even when the algebra is right.
Where This Formula Appears
This equation is the working core of How To Calculate A Car Lease Payment, filed under Finance. Every number the guide produces comes from substituting into this one line.