A small decimal (e.g. 0.00125) used instead of an APR in lease math. Multiply by 2400 for a rough APR-equivalent comparison.
Gross Capitalized Cost
The full negotiated price of the asset before any down payment or trade-in credit is applied.
Capitalized Cost Reduction
The formal term for a lease down payment — reduces the net cap cost that both the depreciation charge and rent charge are calculated on.
Residual Value
The asset's projected value at lease end, set by the leasing company (via guides like ALG or Black Book for vehicles), not negotiated by the lessee.
Acquisition Fee
A one-time fee charged by the leasing company to originate the lease, commonly a few hundred dollars.
Disposition Fee
Charged when you return the leased asset at term end; often waived if you lease again from the same company.
Gap Coverage
Covers the difference between what you owe and the asset's actual cash value if it's totaled or stolen before the lease ends — usually bundled into auto leases by law in many states, but worth confirming.
Early Termination Charge
The cost of ending a lease before its term — typically calculated from the remaining depreciation and rent charges, sometimes close to the full remaining balance.