Lease Return Options
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Super Member
Joined: Jul 2017
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From: Teaneck, NJ
2023 EQB300
Lease Return Options
When my GLC300 lease was up in Oct/20, I simply returned the vehicle since value was pretty much same as residual. My MY21 GLE350 which was replacement for the GLC also now comes up in Oct. It now seems that Mercedes does allow the ability to trade the vehicle with the selling dealer paying off the lease much as a loan. I could also sell the vehicle to Carvana or CarMax. At the moment, value exceeds the lease buyout but obviously none of us know how much used car values will soften over the coming months. If I were to go with a different brand, I know dealers would trade the GLE, probably for more than I would get from Carvana or CarMax. Would a Mercedes dealer trade the car ? I know they would much prefer that the car come back as a lease return which they could then buy from MB at a much lower wholesale than the residual and turn a nice profit on it (and no, I do not object to businesses making a profit). That's what happened with my GLC-- dealer bought it and they got a very nice price for it. In other words, looking for best way potentially to capture some equity from the GLE.
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From: Fredericksburg, VA
2020 Mercedes GLE350 4Matic; 2023 Tesla Model Y
The answer is it depends. What are your state rules on lease buy backs and selling to a private party? Will your State allow uou buy out the lease, then quickly sell it without paying tax -- pass the tax bill to the purchaser? What does your lease contract state? Here's a decent article on the possibilities.
Yes, You Can Sell a Leased Car
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From: Colorado
'21 AMG53 wDPP & ARC, 19 GLC300 - Former-03 C240,2 ML BlueTecs,20 GLE450 E-ABC,15 Cayenne D,17 Macan
The answer is it depends. What are your state rules on lease buy backs and selling to a private party? Will your State allow uou buy out the lease, then quickly sell it without paying tax -- pass the tax bill to the purchaser? What does your lease contract state? Here's a decent article on the possibilities.
Yes, You Can Sell a Leased Car
You'll likely have to pay sales tax in the state where you register - I'm not aware of any States near the Rockies that don't.
Edit: The sales tax will be on the buyout price, not the original sales price, since each lease payment was taxed.
Last edited by mikapen; Jan 28, 2023 at 02:36 PM.
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From: Florida (727)
Check to see what the CURRENT rules and restrictions are for selling a lease vehicle and whatnot. I know Mercedes Benz Financial (or whoever does the MB leases) prohibited selling the leased vehicles or trading them into other dealerships because the consumer was making money. They may have loosened those restrictions since that time but you need to check.
Before COVID there were not many restrictions with selling or trading in a leased vehicle, but since COVID and sometime in 2021 or 2022 the lessor stopped allowing the lessee to sell or trade to another and would only allow the lessee to purchase the vehicle or to return it. Your GLE should have a lot of positive equity so it would be worth just buying it at the end of the lease and waiting a few months or so until you find the right vehicle for your needs. If you trade it into the dealership they will give you very little for it or they may even try to say that they cannot give more than the buyback value stated in your lease.
I will say for my situation, my lease comes due in a tad over 1 year from now and I am planning on purchasing my 21 GLE 350 at the end (unless they can give me a stupid crazy deal on another GLE). The buyback after taxes should come out to around $38K-$39K for mine which is cheap IMO and it should be worth about $5K more than that at that time if things continue the way they are. This is a very rough estimate.
Before COVID there were not many restrictions with selling or trading in a leased vehicle, but since COVID and sometime in 2021 or 2022 the lessor stopped allowing the lessee to sell or trade to another and would only allow the lessee to purchase the vehicle or to return it. Your GLE should have a lot of positive equity so it would be worth just buying it at the end of the lease and waiting a few months or so until you find the right vehicle for your needs. If you trade it into the dealership they will give you very little for it or they may even try to say that they cannot give more than the buyback value stated in your lease.
I will say for my situation, my lease comes due in a tad over 1 year from now and I am planning on purchasing my 21 GLE 350 at the end (unless they can give me a stupid crazy deal on another GLE). The buyback after taxes should come out to around $38K-$39K for mine which is cheap IMO and it should be worth about $5K more than that at that time if things continue the way they are. This is a very rough estimate.
Last edited by makris0000; Jan 28, 2023 at 02:06 PM.
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From: San Francisco Bay Area
2019 C63CS
As said above, you can generally trade in a leased car, but since the pandemic there are restrictions and you can only trade in to a Mercedes dealer for another Mercedes. If the dealer is fair, they'll give you market value and you can put the equity towards your next car or have them write you a check. Fundamentally, you can't sell a leased car before buying it out. As a lessee, you don't own the car, so you don't have the right to sell it. Some states as mentioned above give you a very short window during which you can buy out the lease, then sell it to a private buyer and only the private buyer has to pay the taxes on the buyout. Generally this is difficult, though, because you likely won't get the title in time. But you can always buy out the lease and then sell it. You will have to pay taxes on the buyout, but if you have a lot of equity you may still come out ahead when you sell it. Or maybe you decide to keep the car for a little longer and then sell it. That's what I did 10 years ago or so the last time I leased. I liked the car, so I bought it out, kept it for another few years until there was something else I really wanted and then traded it in. Nowadays I pay cash for my cars, especially since I did European Delivery with both of my most recent cars and the car is mine, so I can do with it whatever I want, and no lien on it.
Last edited by superswiss; Jan 28, 2023 at 03:04 PM.
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From: Scottsdale AZ
2015 CLS 550 2015 ML 400 Previous 2020 GLB 250 2019 A 220 2005 ML 350 1989 300 E 2001 SL 500
When my GLC300 lease was up in Oct/20, I simply returned the vehicle since value was pretty much same as residual. My MY21 GLE350 which was replacement for the GLC also now comes up in Oct. It now seems that Mercedes does allow the ability to trade the vehicle with the selling dealer paying off the lease much as a loan. I could also sell the vehicle to Carvana or CarMax. At the moment, value exceeds the lease buyout but obviously none of us know how much used car values will soften over the coming months. If I were to go with a different brand, I know dealers would trade the GLE, probably for more than I would get from Carvana or CarMax. Would a Mercedes dealer trade the car ? I know they would much prefer that the car come back as a lease return which they could then buy from MB at a much lower wholesale than the residual and turn a nice profit on it (and no, I do not object to businesses making a profit). That's what happened with my GLC-- dealer bought it and they got a very nice price for it. In other words, looking for best way potentially to capture some equity from the GLE.
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Joined: Jan 2020
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From: Fredericksburg, VA
2020 Mercedes GLE350 4Matic; 2023 Tesla Model Y
I purchased my Mercedes, but I lease a 22 Honda Pilot as a commuter car. Out of curiosity, I checked what the rules are in Virginia. I did pay sales tax on the Pilot (for the full purchase price, Virginia doesn’t allow you to discount trade-ins from the tax due) and I also pay personal property tax. My name is on the lease. If I read this correctly, I don’t have to pay sales tax again if I choose to purchase the vehicle at the end of the lease. I didn’t know that.Virginia DOT
When a lease ends, the lessee can either return the leased vehicle, or buy it from the lessor.
If you return the vehicle, the lessor is responsible for any vehicle-related actions moving forward.
If you buy the vehicle, you must re-title the vehicle in your name and pay Motor Vehicle Sales and Use Tax (SUT), which is based on the residual value paid by the lessee to the lessor.
Virginia DOT
Buying Out Your Vehicle Lease
When a lease ends, the lessee can either return the leased vehicle, or buy it from the lessor.If you return the vehicle, the lessor is responsible for any vehicle-related actions moving forward.
If you buy the vehicle, you must re-title the vehicle in your name and pay Motor Vehicle Sales and Use Tax (SUT), which is based on the residual value paid by the lessee to the lessor.
SUT Exemption
If you already paid the SUT when you leased the vehicle, you may be exempt from paying it again, if:- You present proof you paid the SUT in Virginia
- The title includes your name on the lease and not a commercial entity
- You purchased the vehicle directly from the lessor, or from the selling dealer if one existed
Last edited by TexAg91; Jan 28, 2023 at 04:52 PM.
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Out Of Control!!
Joined: Nov 2018
Posts: 11,651
Likes: 5,468
From: San Francisco Bay Area
2019 C63CS
Originally Posted by TexAg91
I purchased my Mercedes, but I lease 22 Honda pilot is a commuter car. Out of curiosity, I checked what the rules are in Virginia. I did pay sales tax on the Pilot (for the full purchase price, Virginia doesn’t allow you to discount trade-ins from the tax due) and I also pay personal property tax. My name is on the lease. If I read this correctly, I don’t have to pay sales tax again if I choose to purchase the vehicle at the end of the lease. I didn’t know that.Virginia DOT
When a lease ends, the lessee can either return the leased vehicle, or buy it from the lessor.
If you return the vehicle, the lessor is responsible for any vehicle-related actions moving forward.
If you buy the vehicle, you must re-title the vehicle in your name and pay Motor Vehicle Sales and Use Tax (SUT), which is based on the residual value paid by the lessee to the lessor.
Virginia DOT
Buying Out Your Vehicle Lease
When a lease ends, the lessee can either return the leased vehicle, or buy it from the lessor.If you return the vehicle, the lessor is responsible for any vehicle-related actions moving forward.
If you buy the vehicle, you must re-title the vehicle in your name and pay Motor Vehicle Sales and Use Tax (SUT), which is based on the residual value paid by the lessee to the lessor.
SUT Exemption
If you already paid the SUT when you leased the vehicle, you may be exempt from paying it again, if:- You present proof you paid the SUT in Virginia
- The title includes your name on the lease and not a commercial entity
- You purchased the vehicle directly from the lessor, or from the selling dealer if one existed
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Thread Starter
Super Member
Joined: Jul 2017
Posts: 699
Likes: 158
From: Teaneck, NJ
2023 EQB300
Interesting fact that Carvana would have to pay tax. I'll discuss the idea of trade to capture equity with my rep. As a multiple-repeat customer and also owing to the high standards of this dealership, I should get a very honest assessment. And if MB no longer discounts below residual to the dealers, they may want to trade in order to keep my business. Buyout on the GLE will be around $35K. I would buy the car but wife positively hates it so better to keep her happy.
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Joined: Oct 2009
Posts: 7,073
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From: Colorado
'21 AMG53 wDPP & ARC, 19 GLC300 - Former-03 C240,2 ML BlueTecs,20 GLE450 E-ABC,15 Cayenne D,17 Macan
Thread Starter
Super Member
Joined: Jul 2017
Posts: 699
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From: Teaneck, NJ
2023 EQB300
Well, as they would say in court, I opened the door so I should respond. She hates it for the reason I love it-- size. Perfect size for me. Too big for her. And she finds MBUX overly complex. Often accidentally brushes the (unnecessary) touch pad. But loves the comfort on the road. Now after we possibly go to EQB for next car, we'll see what she says after the first Costco run.
