The Model Black builds every lease payment on the lender's residual for that model, term, and mileage, because it is the single largest input. The residual is the lender's forecast of the car's value at lease end, stated as a percentage of MSRP.
A $70,000 car with a 55 percent residual is worth $38,500 to the lender at the end; your payments cover the other $31,500 plus the rent charge and tax.
On a 36-month lease, moving the residual by five points on a $70,000 car changes the depreciation you pay by $3,500, about $97 a month. Moving the money factor by 0.00050 (1.2 points on the lease rate expressed as an annual percentage) changes the rent charge by about $54 a month. Both matter; the residual usually matters more, and it is the one you cannot change by structure. It comes from the lender's program table for that model, term, and mileage.
The residual is also your purchase option price if you decide to keep the car. If the car is worth more than the residual at lease end, you have equity: buy it and keep it, or buy it and sell it, or trade the equity into the next car. If it is worth less, hand it back; the shortfall is the lender's problem, not yours. That asymmetry is the reason a lease can beat paying cash for someone who replaces cars every two to three years.
For a 36-month, 10,000-mile lease, luxury models commonly land somewhere in the mid 50s to low 60s as a percentage of MSRP; the figure is model-specific and published by the lender each month.
No. The residual is a percentage of MSRP, not of the selling price. A lower selling price lowers your depreciation charge against the same residual, which is why a dealer discount matters so much on a lease.
No; you see the payment it produces. The dealer's lease contract states the residual as the purchase option price.
That is equity. You can buy the car at the residual and keep or sell it, or use the difference toward the next car.