Do not approach the dealer at all until you have a better idea of which direction you want to go. You have 3 basic options:
Buyout the car and keep it. You can buy the car directly from MBFS, you do not need to involve any dealer.
Sell the car to a dealer, get something else. Get quotes from Carvana, Vroom, Carmax, local delaers, etc. and compare that to your current buyout to see how much equity you have. Research the new car lease/purchase as a separate transaction.
Just turn in the lease at the end. Not recommended unless you don’t have any equity.
Which option is best depends entirely on if you want to keep the car or not and how much equity you may have.
Thanks Jeff for the guidance! First time leaser - apologize advance for silly questions for the options -
Buyout the car from MBFS - is this price negotiable (as the buyout price is listed on the contract)? Do I contact MBFS directly online?
This is to do some research on how much my car is worth with its current condition and sell that to the dealer? (Do I need to buy the car first before I can sell it to the dealer? assuming at the end of the lease, I don’t own the car?)
Curious why this is not recommended? Is it cuz current car prices are high now?
I don’t mind keeping the car as I barely drove it in the past 3 years - trying to understand how to negotiate the best ‘deal’ / option at the end of the lease.
This is not really the best way to think through your options.
Do you really need a car? If so, what kind of car best suits your needs for the next X years? And what is X?
It’s not a binary choice between keeping or not keeping this car. You can choose to spend $26k + TTL on this car, not have a car, or spend $26k + your equity on any number of other vehicles depending on what your needs and holding period are predicted to be.
I was in a similar situation recently and decided to go with option #1. Here’s the reasoning: we needed a car and Mercedes leases are very high right now and the dealers seem to have very hard prices with little to no room for negotiation - basically very different attitude than when we dealt with them to lease the vehicle three years ago.
Now, option #1 means we have all the other options on the table. It means that, once we own the vehicle, we can sell it at a later date, and specifically at a higher price than the buy-out quote by close to ten thousand dollars at CarMax! We only used about 2/3 of our miles and the vehicle is in excellent condition.
The buyout price isn’t negotiable, this is the residual value listed on your lease contract (plus any taxes). Just pull up your account online at MBFS and request a payoff quote, there will also be instructions on how to pay it off.
MBFS recently changed their rules so you can sell a lease to any dealer (previously it was only MB dealers), you don’t have to buy the car first. You can sell to another dealer at any time between now and lease end. So get your payoff online (see above) then shop it to a lot of dealers to see who offers the most.
Not recommended as it wouldn’t make any sense to just turn the car in if you could otherwise sell it to another dealer (see #2 above) and walk away with an equity check for potentially thousands.
It is very easy, as mentioned, just pull up your account at MBFS online and click “Request a Payoff Quote”. It will bring up your payoff amount and instructions on how to pay it off, either by mailing a check or online. If there is any purchase option fee then it will be included in the payoff quote above.
If you buy the car directly from MBFS (as you should) then you are not going to be offered a CPO or extended warranty or anything like that.