Last post on May 16, 2013 at 2:46 PM
You are in the Prices Paid - Buying & Leasing Experiences
What is this discussion about?
Mercedes-Benz E-Class, Sedan, Wagon
#1215 of 1933 Re: 2012 E350 Convertible- Is this a good price??? [abacomike]
Nov 07, 2011 (11:24 am)
Thanks for the example Dewars... Purchase makes sense when you plan to keep the car for 5 years....I keep a car 2 maybe 3 years at the most...I like change. Leasing makes sense for me because a) I can deduct part of the cost; b) I know what my car will be worth after 24,30,33,36 months (not that I get the money, but it's the residual value). I am almost positive that the residual value on my 2011 bluetec is far in excess of what a dealer will be able to sell the car for in 24 months.
I believe that most people don't take multiple security deposits because a) they are unaware of the option; b) they think that paying the money up front lowering their monthly payment is wonderful; c) dealers don't understand multiple security deposits; d) dealers know that a low monthly payment sells car, so they push money down.
abacom...sounds like you made the right financial decision for your situation. For those like me who like to change cars, multiple security deposits are almost always a great option.
Finally, if you look at Dewar's example...you save $1400 over 2years by loaning Mercedes $5000. that's over 12% per year on that $5000. Compare that to just keeping that money in a money market account, CD or bank account for two years...earning less than 1%.
#1216 of 1933 Current lease terms
Nov 11, 2011 (6:29 pm)
Great discussion on leasing options! Thanks.
Does anyone have the latest lease terms?
I'm looking at a 2012 E350 4matic, I'd like to know the terms on both the gas and the Bluetec.
Also, when you talk about multiple security deposits, how much per deposit? how much of a reduction do you get in the rate per deposit?
You state that you get the deposit back at the end of the lease, do you earn interest on the deposit?
#1217 of 1933 Re: Current lease terms [richardnva]
Nov 11, 2011 (7:49 pm)
There is no bluetec 4matic in the US....so that's not an option.
Each security deposit towards your maximum 10 security deposits is your calculated monthly payment rounded up to the next $50. Different dealers seem to do this different ways and no one seems to know how it's supposed to be done. In my case, they said that each security deposit was my monthly payment including tax (no rounding up). Others have had their monthly payment without tax rounded up to the nearest $50. In both cases the discount for the multiple security deposits is used to calculate the monthly payment and the security deposits.
Each security deposit reduces your MF by .00007 so if you take the maximum of 10, your MF is dropped by .0007. This drop in MF can amount to $50 a month saving. No, there is no interest on the security deposits...the "interest" is the $50/month that you are saving. That is an effective interest rate in excess of 10% in most cases.
Mercedes dealers seem to play with money factors and acquisition fees....they raise them to inflate their profit. The acquisition fee should be $795...if your dealer is charging more, he is keeping it as profit. Tougher to determine is when the dealer marks up the money factor. Unless you determine the rate for your tier by looking at the finance manager's screen or some document from Mercedes Finance, assume that they are marking that up for even more profit. Some dealers use Tier 2 as the base rate which is wrong....your base rate is based on your credit tier and good credit is Tier 1.
Finally, multiple security deposits aren't applicable to "promotional rates"...however they still can result in lower cost, but only if the dealer doesn't mark up those money factors.
Confusing I know...but mercedes finance does not enforce anything with their dealers and they seem to accept any lease the dealer writes, whether it follows the rules or not. This becomes even more obvious if you buy mercedes insurance as part of your lease. Some dealers include it as a "feature" so like any other feature, if you are charged a MSRP for service of $1000 and your lease has a 60% residual, you will only pay $400 for that service. Sounds great and it is...but some dealers won't do it that way, some dealers will tell you that mercedes will only allow you to residualize $600 of the maintenance and others will tell you that you have to pay the entire $1000 over the length of the lease. It doesn't matter which is correct because different dealers do it different ways....and mercedes finance seems to accept it no matter how the dealer does it. You just sort of have to wing it and see what your dealer will do for you.
It's a financial swamp out there. Dealers don't understand Mercedes leasing program, some don't understand multiple security deposits, some don't know that you can residualize at least part of maintenance, but they do understand how to mark what they do know up to make more profit. I wish I could give you accurate answers, but the fact is that since mercedes finance pretty much accepts anything, it's just up to you to negotiate whatever you can. Hopefully there's some useful information in this and my other posts to help.
#1218 of 1933 Re: Current lease terms [ghstudio]
Nov 12, 2011 (9:25 am)
Thanks for the update, let me restate to see if I understood correctly.
Max of 10 security deposits
Each deposit is equal to your monthly payment
Each deposit reduces your MF by .00007
So if your monthly payment is $600 and I want the max, then I put down a depost of $600 x 10 = $6000?
MB holds my deposit for the duration of the lease and returns it to me at the end of the lease?
Is that correct?
#1219 of 1933 Re: Current lease terms [richardnva]
Nov 12, 2011 (10:44 am)
You got it.... but understand that there seems to be no fixed policy by dealers and/or mercedes on the actual amount of each security deposit. In my case, I paid my actual monthly payment including tax as each security deposit with no rounding. Others have paid their monthly payment (not sure if it was with or without tax) rounded up to the next $50. Based on posts in this and other forums, Mercedes finance seems to accept whatever the dealer does.
Be careful about saying that you're putting money down....you are not. You are making multiple security deposits. Putting money down is just paying in advance so your monthly payments are smaller and you don't get that money back. Big difference. I know you know this...but don't confuse the dealer by using the wrong words.
#1220 of 1933 Conquest Cash
Nov 13, 2011 (12:13 am)
Can someone tell me if the $4,000 Conquest Cash applies to the 2012 E350? I know the $2,000 Conquest Cash applies to any new 2011 or 2012 models. Thanks.
#1221 of 1933 Re: Conquest Cash [ucsf]
by kyfdx HOST
Nov 13, 2011 (10:42 am)
The $4000 was on 2011 E-Class models... The 2012 E-Class only has $2000.
#1222 of 1933 California E350 Sedan Lease MF and MSDs
Nov 15, 2011 (1:54 pm)
Working this deal:
E350 Sedan Luxury P1
$48900 negotiated price
30 month lease 12K miles/yr.
MF .00192 for tier 1a credit
Autopay reduces MF by .00001
Dealer says "Mercedes doesn't do MSDs anymore."
Options: $795 Acquisition, $448 license fees
Option 1: $1852.81 cap cost reduction/downpayment $546.85/month incl tax
Option 2: $3719.59 cap cost reduction/downpayment $523.58/month incl tax
Does California allow MSDs?
Does MF look right?
Any advice is appreciated. Thanks.
#1223 of 1933 Re: California E350 Sedan Lease MF and MSDs [rrosenbeca]
Nov 15, 2011 (2:00 pm)
2011 OR 2012?
#1224 of 1933 Re: California E350 Sedan Lease MF and MSDs [kevinc5]
Nov 15, 2011 (2:59 pm)