I created this spreadsheet in Google Sheets that allows you to compare the monthly payments of buying versus leasing in one sheet. It will also show how much interest you pay, so you could add up leasing and buying out the lease with a loan versus just buying with a loan up front to see how much you ultimately spend.

Please only update the cells in yellow, blue, green and grey on the left column. I included areas to enter various fees and even negative equity. Just leave them at $0 if they aren’t applicable.

https://docs.google.com/spreadsheets...t?usp=drivesdk

 

Very cool, thanks for sharing!

 

One important thing to keep in mind is that the dealer will always include the first month’s payment as part of the initial cost. This doesn’t take that into consideration. I tried to make it all work but it got a little complicated because it was iterative.

So, what you have to do is determine the lease payment with the terms you want. Then either subtract that amount from your down payment in the formula to get to your final payment or add that amount above and beyond the down payment at the time of purchase to keep the payment as indicated.

Or, you can just ignore it knowing the shown payment is close enough, but if you want it spot on, you have to account for the initial payment that will be deducted from your down payment, which in turn won’t affect the net capital cost. This is for leasing only.

For example: say you put $5,000 down and the payment comes out to $2,000 a month. In reality, you are only putting $3,000 down because the dealer will subtract out the first payment, so you either have to actually put $7,000 down or enter in $3,000 down and see what your actual payment will be.

Also, this only works if your state charges sales tax on the payment versus all of it up front.

 

You all know a lot more about leasing than I do. I only leased once in my life... I've been overseas for 20 years. But looking at the lease landscape I see BMW 7 series getting killer rates and lease monthlies. I really think MBFS will push sales this fall of it's luxury cars. I think MF .0035 is double what we'll get offered - regardless of what the FED does -- with monthlies above $2500 and some closer to $3000 when the BMW 2027s are half that cost. I own a BMW XM and looked into getting a 2026 (738hp) and the dealer was offering 20% off MSRP on a $161000 car. I saw 2026 S class leases for $1600 on the web - and yes I know MBUSA are trying to dump the 2026s.

My best logical guess—based on current Mercedes-Benz factory launch patterns and internal dealership rate data—is that there is a 70% probability Mercedes-Benz Financial Services (MBFS) will offer promotional lease subsidies by the time the first wave of 2027 S-Class models deliver in September and October.
While it is true that manufacturers usually withhold discounts on a newly refreshed flagship, Mercedes-Benz is currently operating under a strict national directive to achieve 400,000 annual U.S. sales by 2030. To hit this target, MBFS has been aggressively heavily subventing lease programs across their premium tiers to prevent inventory stagnation.
The likelihood of incentives arriving for your delivery window breaks down based to two key factors -
Why Subsidies Are Highly Likely (70% Probability) (pumped w help from AI)

• The S-Class Launch Strategy: The 2027 S-Class is a massive, heavily redesigned mid-cycle refresh with over 50% of its components replaced. Historically, when Mercedes launches a highly complex technological refresh (like the incoming standard MBUX Superscreen array), they prefer to push buyers into short-term leases (like their current 13-month and 24-month promotional programs). This protects the brand's long-term residual values by keeping a steady loop of gently used, high-tech inventory returning to dealer certified pre-owned (CPO) lots.
• Q3/Q4 Volatility: S class will hit the dealership floor right as the industry transitions into the competitive end-of-year sales push (September/October). Dealerships will be highly motivated to move premium vehicles to meet annual quotas, which routinely forces MBFS to offer aggressive regional lease "hacks" or hidden dealer cash incentives to keep momentum strong.

cheers... 30% chance I'm wrong
Awesome spreadsheet btw.

 

I'd be very surprised if they subsidize 2027 sales, they will 26 units to get rid of them. I think MB is content selling far fewer units of the S Class.

 

Mercedes, Porsche and Audi aren’t as generous as BMW when it comes to residual values and money factors, at least that has been my experience.

 

I simply can't believe they will lease these cars at 8.4%+ when all that consumer money goes into the toilet and the residuals are 49%, No person w/ 5th grade math will do that when you can get financing for 4.4% at USAA or any credit union now. I called today and verified. Oh and after 3 years of financing I believe you will be in the black (a residual is not the retail selling price (market value)


Side-by-Side Financial Position at Month 36
Assumptions: $135,000 estimated 2027 MSRP, $15,000 down payment, Virginia dealer doc fee of $899, and home registration in Clark County, NV (8.375% sales tax rate).

Financial Metric at Month 36 36-Month Lease (Subsidized Tier) 72-Month Finance Loan (Lookback at Month 36)
Contract Input Rates 0.00144 Money Factor (3.456% APR) 5.50% Tier-1 72-Month APR Contract Value 46% ($62,100) guaranteed by MBFS None (You own the actual market depreciation)
Sales Tax Structure 8.375% on the monthly payment only
8.375% full upfront tax capitalized ($11,306) Monthly Payment (w/ Tax) $2,090.36 / month $2,159.95 / month Total Out-of-Pocket (36 Mos) $90,252.96 (Down payment + 36 payments) $92,758.36 (Down payment + 36 payments)
Financial Status at Month 36 Walk away clean with $0 owed Owe $71,531.38 remaining to the bank

Crucial Financial Insights at Month 36

Out-of-Pocket Parity
Over the first 36 months, your total cash outlays are remarkably close. You will have paid $92,758.36 on the 72-month loan versus $90,252.96 on the 36-month lease (throw away that money)—a tiny difference of just $2,505.40.

Oh and I honestly dont believe they will sell a 3 yr old $160,000 S class for residual value at $55k. Hell didn't that guy post on this forum that he just bought a 2021 W223 for $65k and raves about the deal he got. Leases only work if the interest rate is low. No savvy salesman will say "hey lease this car with 9% interest rate and a large deposit and high monthlies"

Everyone will sort it out for themselves.

cheers

 

Let's see....Audi discontinued the A8 I think. Mercedes S class sales have been cut in half in the last few years. Porsche has done well w/ their EV Macan ,,, but back to the luxury sedans...

BMW is on a roll past 2 years.......
U.S. sales of the BMW 7 Series have rebounded strongly in recent years, reaching 11,393 units in 2025—a slight increase from 10,715 units in 2024 and 10,810 in 2023. This recent surge reverses a slump from 2020 through 2022 and brings annual volume back to the model's 2016 levels.
Beers on me if I'm wrong..............

 

They don't lease the S Class at those MFs now, that was the MF for Frenetics GT, thats a special car and thats a different matter. MFs on the S Class right now are .00144 for the S580 and 51% and the S500 is 0.00093. You wont see MFs for the S Class over say .0024 even when the refresh is brand new.

The real killer is the lack of rebates. When I leased my S580 there were $16,000 in rebates, and the 7 Series has $10k+ in rebates. S Class has none. They do have a $1,500 conquest certificate, thats it. So you can get 10-11% off of a car like this PLUS the rebates, so that means on a 7 you're looking at $25,000+ off MSRP and that dramatically reduces the lease payments, more than MF or residual could.

Absolutely you are right about the lease vs finance, it makes it hard and I think thats one of the reasons why sales volumes are down. You have a lot of customers like me who lease for business reasons and the poor leases drive us to other products. 7 Series has great lease support, and as much I don't love how they look for $600-$900 a month more I'd have a very hard time going S Class. Buying vs leasing presents all kind of complications for me taxwise I just don't want to deal with.

 

You are right on all of this. Just completed 2 full days of a long-trip shopping around for an SUV, and was at one of the biggest benz dealers. I asked them about their deals and so on, and they said that since covid (when financing rates were really low in the years from 2020-2023 calendar years when the S pre fl was launched, many buyers more than ever before were just financing. 2024 was peak for financing rates that has slowed financing down, but then since 2025 auto-financing deals made sense again especially nowadays. They said that cash buyers and financing is still a good portion of their business now so Mbenz is not too concerned about lease anyway (it's just part of the picture). Salesman was really excited for the FL to see if he can move more cars than before.

I was at a Lexus dealer too for the LX, which is an SUV that does not lease that great, and I was shocked that he said the MAJORITY of their buyers are actually cash buyers, followed by financing.. He said most of his buyers can easily afford the car with no budget issues and go for section 179 or whatever regardless, but regardless that's what I do myself anyway.

When we were looking at X7s, the dealer said that regardless of the great leases, they have many customers who still prefer to save tax and buy cash but many also finance their cars nowadays. He refused to share the exact ratio but said that lease buyers are not as high as I was hinting. He said that there is tension always between their X7 buyers and the GLS, but many many of their new 7 buyers came from the S after the new generation and those were much easier customers to switch. Something they have never been able to do even though in 2021 and 2022 they had the previous 7 generation that leased also really cheap, but most people still got the S at that time until the new gen of the 7. Most sales are the gas model too which has less attractive deals. I guess people like the product, and just like you said, for the S new facelift, mbenz will try to do whatever it takes to take back their customers, which is by offering a good product first combined with good deals if they can keep their expenses low.

I sometimes wonder, out of the many warranty issues (which Mbenz is paying for) with the pre-fl, how much of that has impact their ability also to offer good deals? They must be factoring for that as these cars have been costing them too much due to all the warranty stuff and buybacks. Just a thought.

 

Great post.

I ordered the S class coz of the refresh when the new XM was stale. But I wanted to lower my monthly (I financed the XM) and I was bummed with all this 0.0035 MF talk - its the MF in the spreadsheet too. But I was expecting rebates and discounts like you said. I have the $1500 conquest cert like you said, and I have $500 and $500 for Military and USAA discounts. I put $5k down to order and my XM is about $11k in the black on a trade-in. That right there is $18.5k deduction for a lease or finance. I did look at 7 series online today and their EVs have a $7500 lease rebate as well as other incentives. That's my fallback plan if I cant find a deal on the S class I ordered. I just really want a 8 cyl and I dont think the 7 series has that planned for this year.
Plan A is to lease S class for 24 months then buy it because the RV is so low.

The other advantage for financing is you can refi if the rates go down...

cheers

 

And you would qualify for loyalty and the elite loyalty, so thats another $7,500...so rebates on an i7 are $15,000 for you on top of the $15,000 or so you can get off the car's MSRP. $30k off of MSRP makes for a very attractive payment.

 

You're absolutely right. But BMW is Plan B - but I''ll likely choose the XM because 7 series MY2027 doesnt have a 8 cyl model yet. I still have hope that MBFS will come through for their high-end customers

 

I'm interested to see what happens...

 

Glad to see calculators for people to play through scenarios but I hope nobody would entertain the MF or durations.

I suggest to not go beyond the 36 months for a lease and ask the community the best possible MF rate. These aren't real of course but dealers habitually pad the MF to offset discounts or trunk money.
I also found that for out of state lease deals, dealers are unaware of the sales tax practices of other states, so make sure that dealers always post their complete lease sheets including MF.
MN sales tax for example only applies to the lease portion of the car, not the price.

Residual has the more significant impact on the actual monthly rates and it's on of the most common area where people overpay. Residual can't be touched by dealers but depends on the mileage. Go low on mileage. If you think you'll use 15k a year you might want to go 12k or even 10K. You get a higher residual and it's easier to pay for extra miles or even negotiate them away during the next pull-ahead as dealers are incentivized to move you into a new car.

Also, you will pay max rate for a '27 S-Class. Any early lease deals with pay the highest rate, so figure if you can wait for 6 months. This is not the case for EV's

 

Yeah, the residuals on 48 month leases go down a lot on higher-mileage leases, but it’s actually not that bad on lower mileage leases, like 7.5k, and can lower your payments a lot depending on the car, model and terms.

But the step between 24 to 36 to 48 in residual values at 10k or more miles is pretty big, in fact the magnitude decline in residual values can be twice as high moving from 36 to 48 versus 24 to 36, and sometimes the monthly payment will actually go up between a 36 and 48 month lease. Like always, do your homework, which this spreadsheet can help uou with. You can find residual values and money factors on different terms at Edmund’s lease forum.

 

Correct, I would not automatically say no to a 48 month lease if the numbers make sense. Like Frenetic said low mileage 48 month leases can make sense.

 

Just an FYI, but you don’t need permission to use the spreadsheet. You can just save as or download a copy. I have the original locked.

 

Thanks OP for creating this spreadsheet. I got intrigued by the idea of leasing since I always buy in the past, might try it out next time. So for those who end up ending the term early say by "trading-in" basically you pay buyout price including buyout fee right? For those who are able to do that and not have negative equity, any advice? Like what mileage was signed on the contract and what mileage do you end up driving? How many months early do you usually end the term at prior to maturity? Do you take advantage of pull forward programs but that is usually only available near the end of the term.

 

Think about leasing just as a form of balloon financing. There is a payoff like any loan, its usually the residual plus all the remaining payments. Some companies have lower payoffs if you buy it yourself or trade it in to their brand vs a competitor, just have to be aware of that upfront. When you get to the end of the term you either pay the balloon payment (the residual) or give the car back.

You CAN trade out of it at any time, but you will almost certainly be very upside down until near to the end. Every month the payoff goes down by the amount of the payment (roughly). Where within that time period depends on the car. For instance in our Pacifica I have 4 payments left and I am positive now, I could trade it in today and be out of it clean. Some cars you have to wait until right at the end when its just the residual. I had a 2014 Jeep Grand Cherokee I traded out of only a year in and was out clean...it just depends. My W222 I was 4 months until the end and I was out clean.

You wouldn't use any pull ahead or anything like that because those are incentives to turn it in not trade it in. When you turn it in you are subject to all the terms, if you are over mileage or if you have damage or if you need tires etc you have to pay for all of that. When you trade it in you owe nothing because those things are all factored into the trade in value that you have negotiated.

I have leased many cars since around 2010...man...let me think...12 cars including the two I have now...and I have traded out of all of them, never turned any of them in and never paid $1 in negative equity. It also helps in MD that we pay sales tax on the entire purchase price of the car on a lease, so if I lease a $100,000 car I have to pay 6.5% of $100,000 in taxes. If I turn the car in at the end I just lose that sales tax and I have to pay sales tax on the whole price of the new car. If I trade and get $50,000 in trade they subtract that from the $100,000 for the new car and I only pay 6.5% of $50,000 in taxes. So that saves me $3,250 in taxes, so even if its negative a little bit it still works out.

 

Yeah, there’s nothing wrong with leasing. You’re not getting ripped off. It’s identical to financing except you’re only paying for the depreciation over the term of the lease. it’s perfect for people who like new cars every few years and/or not sure if they want to keep a car long term.

Like Steve said, you can always buy out your lease. In some cases the actual value of the car might be worth more than the residual so you can actually make money because the residual that Mercedes sets is an estimate, it could be worth more or less.

If the actual value of the car is less than the residual in the lease terms then you actually came out ahead in total payments and paid less overall than what the car is worth. If the actual value of the car is worth more than the residual at lease end then you actually overpaid, but you can make that up by buying your lease at the lower value knowing it’s actually worth more. The differences usually aren’t significant enough to warrant that but they were during the crazy used car pricing a few years ago. You could have easily flipped your lease for a profit on certain models.

 

Yep, and to me its just straightforward. I don't have to tie up a bunch of money in depreciating cars, I have a set monthly expense for cars that is easily tax deductible with no concerns about depreciation or recaptured depreciation, and I know and understand leasing well so the numbers and all are second nature to me.

 

Very detailed, received with thanks. Read all and noted down. Thank you both.

 

I only do 7500mile leases. 30 months or 36 months have been the sweet spot in the past, especially with pull aheads. For EV's it has worked out to go 18 to 24 months as the residuals have been bumped up unrealistically to incentivize those cars.
Along with the tax benefits you get to change a bit more often