Toyota has 0% for 36 months, 1.9% for 48 months, and 2.9% for 60 months. if the total price of the car (including processing fees) is 23K... 0% for 36 months = $659 monthly payment, no interest 2.9% for 48 months = $411 monthly payment, $658 yearly interest So how does this interest thing work? Do they calculate the total interest for the 5 years which would be about $3K and add it to the total making it 25K? What is the CarMax value after 2 years? If it's generally within 5-6K of purchase price, isn't it a better deal than leasing?
Interest on loans is not calculated the way you describe it. Each month's payment is divided into interest and principle. The first month is virtually all interest, and the last month virtually all principle. As the loan progresses, more of the monthly payment goes towards paying down the principle. You could google it if you're interested in the mechanics of the calculation. Regarding purchase/financing vs. leasing, this topic has been discussed to death here, so I'd suggest a search.
