What's Wrong With The MB Lease Calculator
12-20-2015, 01:11 AM
#1
MBWorld Fanatic!
Thread Starter
What's Wrong With The MB Lease Calculator
I'm testing builds on the MBUSA website, and using the site's internal lease payment calculator. It's working from MSRP and destination charge. I'm not getting the same net monthly payment numbers on my spreadsheet.
I have 58% residual on a 36/15, money factor of .00251
The MB calculator is under calculating the payment by over $100 vs my numbers. I know the spreadsheet works... I just worked a deal for a friend of mine and I was within 50 cents of the payment.
Any ideas?
I have 58% residual on a 36/15, money factor of .00251
The MB calculator is under calculating the payment by over $100 vs my numbers. I know the spreadsheet works... I just worked a deal for a friend of mine and I was within 50 cents of the payment.
Any ideas?
12-20-2015, 12:30 PM
#2
taxes, freight, pdi? i think there is something else as well that it could be.
I did my calculations on the mb canada website and it was way off, talking to my salesmen he listed off a bunch of things and said the site doesn't account for anywhere from 5-8000 in extra costs.
I did my calculations on the mb canada website and it was way off, talking to my salesmen he listed off a bunch of things and said the site doesn't account for anywhere from 5-8000 in extra costs.
12-20-2015, 01:17 PM
#3
MBWorld Fanatic!
Thread Starter
taxes, freight, pdi? i think there is something else as well that it could be.
I did my calculations on the mb canada website and it was way off, talking to my salesmen he listed off a bunch of things and said the site doesn't account for anywhere from 5-8000 in extra costs.
I did my calculations on the mb canada website and it was way off, talking to my salesmen he listed off a bunch of things and said the site doesn't account for anywhere from 5-8000 in extra costs.
MSRP - Depreciation = cost to be financed. So a $50000 car with a 50% residual would leave $25000 to be financed. (The capitalized cost).
Discounts off MSRP, and credits like equity from a trade would reduce that amount (a capitalized cost reduction.) if the dealer gave you $2000 off MSRP and there was $8000 in trade equity, you'd reduce the $25000 to be financed by $10,000, to $15000.
If you wanted to do a Sign&Drive (no money due at signing) you'd add back in the acquisition fee (around $1000) the dealer prep fee (around $900) any tag fees (around $200), plus any optional warranties, wear and tear insurance, etc. So minimally put $2100 back on to the $15000, and you get a net capitalized cost of $17,100.
The money factor ( also set by the manufacturer) represents the interest charged on the financing. Multiply the money factor by the amount financed to get your financing cost.
Your monthly lease payment is the ($17,100 + financing costs) divided by lease term, plus your state sales tax.
That's all there is. If not a sign and drive, then back out the $2,100 in dealer fees from the $17,100 and pay those up front, reducing the amount financed by $2,100. There should never be a $5000 to $8000 black hole that the buyer can't account for.
When I do a lease deal, I have my laptop and spreadsheet running. That way as variables change (and they will) I can update on the fly and have the spreadsheet recalculate the impact on payment. (I'll post it if anyone wants it). I'm in complete control throughout the deal.
In the finance guys office no paperwork gets generated until our numbers agree. The spreadsheet shows the variance between what the payment should be vs what the dealership is quoting. I'll have them swing their monitor around so I can see where we're off. 99% of the time it's some extra stuff they've quietly added to MSRP..."leather protection" or "paint sealant" or "undercoating". I'll get that all backed out so the numbers line up.
I'm usually within a couple of dollars a month off, essentially rounding errors, and that's fine. The last deal I was off by 50 cents, but originally we were off by almost a hundred dollars in payment, and a couple extra grand financed.
Once the FI guy showed me his hand, they had created a misc category called "additional up front fees: $2500". Just pure profit they couldn't get in through the front door. Once that was out, we lined right up and the deal was done. Without the spreadsheet it would have been hard to flag that, especially in the excitement and emotion of the deal in play. You might easily agree to an extra $50 in payment just to get out of the guys office. They wear you down.
Do FI guys hate me? Yes and no. If they thought they were scoring a big commission on the financing, they're not happy, but they do their job and close the deal. If they're no nonsense professionals they appreciate the expediency. Remember that second to the Service department, Financing & Insurance is the dealership's strongest profit generator.
Your guard is down ( you think the negotiations are over so you relax), and that beautiful new car is RIGHT THERE, just need to sign some DMV and loan papers, and the guy is so much nicer and calmer than the sales team was. So you buy "wear and tear insurance" (Don't) and "wheel protection insurance" (Also Don't)and whatever else.
Meanwhile, the MB website is underpricing leases based on their own residuals, money factor and MSRP numbers, so you might be in for a surprise when it comes time to buy.
Last edited by Mike5215; 12-20-2015 at 02:33 PM.
12-21-2015, 04:34 PM
#4
In the U.S. at least, the amount financed is based on the depreciation. Depreciation is the MSRP (Mulroney sticker including Destination ) less the residual value. The manufacturer sets the residual. MB puts the 36 month residual at 15,000 miles a year at 58% of MSRP.
MSRP - Depreciation = cost to be financed. So a $50000 car with a 50% residual would leave $25000 to be financed. (The capitalized cost).
Discounts off MSRP, and credits like equity from a trade would reduce that amount (a capitalized cost reduction.) if the dealer gave you $2000 off MSRP and there was $8000 in trade equity, you'd reduce the $25000 to be financed by $10,000, to $15000.
If you wanted to do a Sign&Drive (no money due at signing) you'd add back in the acquisition fee (around $1000) the dealer prep fee (around $900) any tag fees (around $200), plus any optional warranties, wear and tear insurance, etc. So minimally put $2100 back on to the $15000, and you get a net capitalized cost of $17,100.
The money factor ( also set by the manufacturer) represents the interest charged on the financing. Multiply the money factor by the amount financed to get your financing cost.
Your monthly lease payment is the ($17,100 + financing costs) divided by lease term, plus your state sales tax.
That's all there is. If not a sign and drive, then back out the $2,100 in dealer fees from the $17,100 and pay those up front, reducing the amount financed by $2,100. There should never be a $5000 to $8000 black hole that the buyer can't account for.
When I do a lease deal, I have my laptop and spreadsheet running. That way as variables change (and they will) I can update on the fly and have the spreadsheet recalculate the impact on payment. (I'll post it if anyone wants it). I'm in complete control throughout the deal.
In the finance guys office no paperwork gets generated until our numbers agree. The spreadsheet shows the variance between what the payment should be vs what the dealership is quoting. I'll have them swing their monitor around so I can see where we're off. 99% of the time it's some extra stuff they've quietly added to MSRP..."leather protection" or "paint sealant" or "undercoating". I'll get that all backed out so the numbers line up.
I'm usually within a couple of dollars a month off, essentially rounding errors, and that's fine. The last deal I was off by 50 cents, but originally we were off by almost a hundred dollars in payment, and a couple extra grand financed.
Once the FI guy showed me his hand, they had created a misc category called "additional up front fees: $2500". Just pure profit they couldn't get in through the front door. Once that was out, we lined right up and the deal was done. Without the spreadsheet it would have been hard to flag that, especially in the excitement and emotion of the deal in play. You might easily agree to an extra $50 in payment just to get out of the guys office. They wear you down.
Do FI guys hate me? Yes and no. If they thought they were scoring a big commission on the financing, they're not happy, but they do their job and close the deal. If they're no nonsense professionals they appreciate the expediency. Remember that second to the Service department, Financing & Insurance is the dealership's strongest profit generator.
Your guard is down ( you think the negotiations are over so you relax), and that beautiful new car is RIGHT THERE, just need to sign some DMV and loan papers, and the guy is so much nicer and calmer than the sales team was. So you buy "wear and tear insurance" (Don't) and "wheel protection insurance" (Also Don't)and whatever else.
Meanwhile, the MB website is underpricing leases based on their own residuals, money factor and MSRP numbers, so you might be in for a surprise when it comes time to buy.
MSRP - Depreciation = cost to be financed. So a $50000 car with a 50% residual would leave $25000 to be financed. (The capitalized cost).
Discounts off MSRP, and credits like equity from a trade would reduce that amount (a capitalized cost reduction.) if the dealer gave you $2000 off MSRP and there was $8000 in trade equity, you'd reduce the $25000 to be financed by $10,000, to $15000.
If you wanted to do a Sign&Drive (no money due at signing) you'd add back in the acquisition fee (around $1000) the dealer prep fee (around $900) any tag fees (around $200), plus any optional warranties, wear and tear insurance, etc. So minimally put $2100 back on to the $15000, and you get a net capitalized cost of $17,100.
The money factor ( also set by the manufacturer) represents the interest charged on the financing. Multiply the money factor by the amount financed to get your financing cost.
Your monthly lease payment is the ($17,100 + financing costs) divided by lease term, plus your state sales tax.
That's all there is. If not a sign and drive, then back out the $2,100 in dealer fees from the $17,100 and pay those up front, reducing the amount financed by $2,100. There should never be a $5000 to $8000 black hole that the buyer can't account for.
When I do a lease deal, I have my laptop and spreadsheet running. That way as variables change (and they will) I can update on the fly and have the spreadsheet recalculate the impact on payment. (I'll post it if anyone wants it). I'm in complete control throughout the deal.
In the finance guys office no paperwork gets generated until our numbers agree. The spreadsheet shows the variance between what the payment should be vs what the dealership is quoting. I'll have them swing their monitor around so I can see where we're off. 99% of the time it's some extra stuff they've quietly added to MSRP..."leather protection" or "paint sealant" or "undercoating". I'll get that all backed out so the numbers line up.
I'm usually within a couple of dollars a month off, essentially rounding errors, and that's fine. The last deal I was off by 50 cents, but originally we were off by almost a hundred dollars in payment, and a couple extra grand financed.
Once the FI guy showed me his hand, they had created a misc category called "additional up front fees: $2500". Just pure profit they couldn't get in through the front door. Once that was out, we lined right up and the deal was done. Without the spreadsheet it would have been hard to flag that, especially in the excitement and emotion of the deal in play. You might easily agree to an extra $50 in payment just to get out of the guys office. They wear you down.
Do FI guys hate me? Yes and no. If they thought they were scoring a big commission on the financing, they're not happy, but they do their job and close the deal. If they're no nonsense professionals they appreciate the expediency. Remember that second to the Service department, Financing & Insurance is the dealership's strongest profit generator.
Your guard is down ( you think the negotiations are over so you relax), and that beautiful new car is RIGHT THERE, just need to sign some DMV and loan papers, and the guy is so much nicer and calmer than the sales team was. So you buy "wear and tear insurance" (Don't) and "wheel protection insurance" (Also Don't)and whatever else.
Meanwhile, the MB website is underpricing leases based on their own residuals, money factor and MSRP numbers, so you might be in for a surprise when it comes time to buy.
12-21-2015, 04:47 PM
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