hundolots

What is a fair monthly payment for a 2019 S560 that’s $111,000? Figure $5-8k for trade-in. I’ve never leased an S class before (only financed) and I don’t wanna get taken.

i don’t know how long the lease is going to be. Feel free to weigh in, make suggestions on that.

mikey94025

If you don't want to get taken, don't think in terms of the monthly payment as that changes based on so many factors including length of term. Instead, treat it like a financing decision where you understand the finance charge and term of the lease. Ask what the "money factor" is, which is just another term for finance charge for a lease. Multiply by 24 (or 2400) and that gets you something approximately close to APR: https://www.investopedia.com/terms/m/money-factor.asp. You are getting taken if your money factor works out to 6% or more, but they entice you with a low "monthly payment". And as others have posted here, NEVER PUT MORE MONEY DOWN FOR A LEASE THAN REQUIRED. Doing so is called "cap cost reduction" and is just a fancy way of prepaying a little of each monthly payment but there is no financing advantage (i.e., it's reverse float of your money). Cap cost reduction is just a way to make the monthly payment more acceptable to a customer, but they're just doing it themselves.

The other major factor for leasing is the residual, i.e., how much your car is expected to be worth at the end of your leasing term. You want the residual to be really high if you want to borrow less and you want lower payments, but it means that at the end of the lease if you really want to buy the car then it may be expensive (or worse, cost you more than it's worth). The dealer wants the residual to be lower than really want your car will be worth at the end of the leasing term so they aren't under-loaning you money, though that makes your monthly payment increase and unattractive to customers. If you drive low miles per year then they will increase the residual percentage by a point or two, because presumably the car will be worth more at the end of the lease (though in reality few customers pays more for "low miles" cars).

The best leases are for cars that are worth a fair bit at the end of the leasing term, like Mercedes vehicles, because then the monthly payments are reasonable and for companies willing to have low money factor for their leases, like BMW. The worst leases are cars that depreciate more than others, like American and Audis, because the residuals are lower so lease monthly payments are relatively higher vs. competing brands.

I like leasing and recommend that you consider ignoring all of this and just treat it like a really long monthly rental. If you're happy with paying the money to rent the car each month then go for it, if it makes you happy!