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To lease a Demo or Not

 
Old 09-25-2017, 06:41 PM
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To lease a Demo or Not

Hi all - I'm in the market for a GLS. Ideally, wanted 24 or 30 months but those programs aren't that great. I was offered the following and wondering if it's worth entertaining:

Current miles: 5,000
MSRP: $76,000
Drive off (first month + fees): $2,500
Monthly payment: $757/mo plus tax
Miles: 10k/year
Term: 36 months

Would love to hear your thoughts.

Thanks
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Old 09-26-2017, 12:15 AM
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ask for the cap cost, money factor, and residual. monthly 757 but 2500 drive off? that sounds more than just first month plus fees.
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Old 09-26-2017, 01:38 AM
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Thank you for the reply. In my history of leasing, I've never paid attention to those numbers as I have always either returned my cars at the end of the term or found someone to take over my leases beforehand. Is there a reason I should know those numbers if I plan to do the same with this car?

The remainder of the $2500 goes towards a down payment. But I wasn't given the exact amounts as we were just going over first payment and monthly payments.
Thanks!
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Old 09-26-2017, 01:58 AM
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Well....

You're looking at a pretty "base" GLS if MSRP was $76K..

1. Make sure the features and options it has will make you happy

2. If retired Loaner - then it should be 8%-10% off MSRP going into the top of the lease... and that discount is giving you the same effect as "cash".. you should be getting quoted 1st payment only..no need to the $2500 or whatever..

3. If your lease payment will include taxes - then you need to focus on total payment incl tax..

4. It's 5-days count down to end-of-month/end-of-quarter - every dealer wants to sell most units into EOM/EOQ

5. Look at the National Program... your discount is same as adding cash it calls for.. eyeball the national deal w/details - and you will have a good perspective if your dealer is being straight up with you.

Keep the beat !
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Old 09-27-2017, 12:18 PM
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Their response

Here's what their response is to the questions posed here:
Selling price is $67500
MF is 0.00071
$43708.85
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Old 09-29-2017, 12:15 AM
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sorry for late reply. 0.00071 means 1.7%, i think that's pretty decent. if you want you can go to edmunds forum under the GLS and read up what the current money factor is. but 1.7% seems pretty good

msrp 76k, so they are discounting about 10k, looks like it's a demo car so i say it's "ok" imho

residual is 57%, this is probably fixed by mbfs but it's a good reference.

i say overall the rate is good, but on the cap cost fabbrisd1 probably has some good advice
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Old 10-14-2017, 09:36 AM
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2019 GLS450
Originally Posted by DoctorJeff View Post
Thank you for the reply. In my history of leasing, I've never paid attention to those numbers as I have always either returned my cars at the end of the term or found someone to take over my leases beforehand. Is there a reason I should know those numbers if I plan to do the same with this car?

The remainder of the $2500 goes towards a down payment. But I wasn't given the exact amounts as we were just going over first payment and monthly payments.
Thanks!
This is why dealers love customers that only shop monthly payments. It is in your best interests to understand all the moving parts of a lease. MF is your interest rate, how do you know if it is marked up and you're paying more than you have to? Cap cost is the actual selling price of the car. The lower you negotiate the cap cost, the less you're paying per month. Acquisition fee you should know also as Mercedes Financial only charges $795 but the dealer is allowed to mark it up to $1095. If you don't ask for these numbers, then that is another $300 that you're unnecessarily paying. Residual value is set but can change monthly. If this month it is only 55%, might be wise to wait to see if it goes up next month to 59% for example. That 4% difference can be ~$100/month. Why would you want to have a down payment on a lease? You're only pre-paying part of the lease but your total lease obligation remains the same. I hate to see people put thousands down (cap cost reduction). In most states, that cash down is taxable so again, adding to your cost. Also, if the car gets totaled, doesn't matter if you hit a wall, get t-boned by an inattentive driver, or a tree comes down on the car, the insurance company pays off the car to Mercedes Financial. You do not get that down payment back.

Last edited by skw; 11-18-2017 at 12:16 PM.
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Old 10-14-2017, 07:28 PM
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Well... all and all informative comment - however, often mixed with personal opinion.

What might be the best lease strategy/objective/choice for one buyer - might be a entirely different strategy/objective/choice for another buyer.

1. For some buyer's - cash into the front end of the lease can be their useful tool for them to bring down monthly payments to their desired monthly budget - that's their choice

2. For some buyer's - a One Pay single payment lease is their best choice

The other thing on lease's - as compared to check-writing-cash-purchase - \a Lease Program it ALWAYS comes down to what-payment/what-term/what-mileage.

The information that most customers don't ask for - when they should ALWAYS ask for is - What happens at the Lease End - what are my ending costs ? and the 2nd question - If I want to move forward to my next Mercedes earlier - what can I expect you can do ?

Most customers - and almost ALL salesmen - brush over this too fast with too little factual information.

Keep the beat !


Whether no-cash or cash-in - it a budgeting choice by the customer.
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