How much MF mark up does MBFS allow dealers? And all other FAQ by @bmwmb


Just reached to a dealer on a 23% off MSRP loaner 2020 C300 4matic sedan with the numbers I got from Edmunds for 24/12k lease (62% RV and 0.0003 MF), but the dealer replied with different numbers. They offered a deal with 0.0013 MF (3.12% APR vs 0.72%!) and the RV was kind of at around 60% (after adjusting miles, still lower RV than the calc).

They also had a $1095 acq fee as opposed to the calculator’s $795.

So the deal they offered (and didn’t want to negotiate at all) was $1000 down and monthly of $503 incl. tax.

When I put the Edmunds based numbers in the calculator I got $946 down and $452 monthly (which is almost $2k less than their deal):

Eventually, after a very short back-and-forth with an online representative when I said the 0.0013 MF looks high, they simply declined to negotiate and just kind of said “no, bye”.

Was I being unrealistic or rude asking for Edmunds MF? It was the first time I reached to a dealer so trying to learn from it.

The MF, provided by Edmunds, is the interest rate for Tier 1 (Top Tier) credit with MBFS. Assuming that you have Tier 1 credit, you should get the base MF. I suspect that the dealer increased the MF to offset the 23% discount. There is a cap as to the amount MB dealers may increase the MF, but I don’t recall the amount. Edmunds Forums may know.

With respect to the RV, it is fixed by the bank and can’t be changed. Its possible that they reduced the RV to account for the loaner miles, but I’ve leased a loaner MB before, and they used the ‘correct’ RV (i.e., they didn’t adjust).

As for acquisition fee, I think MB increased it to $1095, but it may depend on vehicle. Edmunds would know as well.

My recommendation would be to either ask for more of a discount to offset the MF or walk. If you decide to move forward, consider MSD’s to reduce the inflated MF.

1 Like

There’s no reason to assume they should or will give a non marked up mf just because you have tier 1. Further, it’s really in your best interest to have them mark the mf up as high as they want, as long as you get a commensurate discount.

Use buy rate to inform your target pricing, but don’t worry about if they give it or not. You shouldn’t care how they get to your numbers.


I am curious, does Mercedes have a tier 0? When I questioned an mf markup they said that’s tier 1 mf, but if you qualify for 0…

Wasn’t sure if he was just making that up.

Great credit means that you are eligible for a deal at the base rate mf, it does not mean you are entitled to one. Most captives allow the dealer to mark up the mf for a greater profit. Expecting a 23% off deal with base rate mf and a non-marked up acq fee may be going a little too far for this dealer. Would you be ok at 20% off and base rate mf / acq fee…perhaps propose that to them. As stated above, its up to the dealer to move things around in the hopes of reaching your target deal…either they can, can’t or you meet in the middle or call it a day and find another dealer.

If I recall correctly MBFS allows dealers to mark up the acq fee by $300 which they did in this case. It’s clear the dealer has structured the deal to make money on finance and acq fee mark-up…it’s up to you to decide.

Yes, it is called paying cash. You get the lowest interest rate of 0%.


Yep, that was clear to me too. When I mentioned it’s high they kind of walked at me pretty much definitively. Since the discount was high (23% off original MSRP) it didn’t make sense to me to ask for an additional discount.

I knew they could mark up MF (from reading around) but didn’t think it’s going to be ~$2k overall over the base MF & RV.

I don’t know what tier I am at, but my Experian FICO is usually around 740 and I have a car loan in my credit history. I didn’t fill any application.

The way they walked at me felt like they thought I am trying to rip them off. The only two things I questioned were the acq fee (that was lower in the calculator) and the high MF. I was ready to sign with the calc numbers, but less so with their offer. It’s my first time reaching to a dealer so I am not shocked I did bad at it, but it makes things tougher since I thought the MF isn’t going to be adjusted that much and I could just reach out to the dealer on an already discounted car and just close the deal.

So does that mean that when I use the calculator I should use the 0.0013 from now on to get a better sense of what to expect from the dealer? Obviously, I didn’t feel comfortable asking for additional discount on a 23% off vehicle

I’ve never seen an mb dealer not mark up the acq fee.

What was your target pricing going into the dealer conversation?

1 Like

Evaluate the deal as a whole. If a good deal on this car say 20% off and base MF, does that equal the same payment as 23% off but a marked up money factor?


Work out a target deal based on buy rate and researched pre-incentive discount targets. If you see a dealer advertising an exceptionally large discount, expect it to have huge caveats go with it. Pricing is holistic and it’s very easy for a dealer to advertise one value that looks amazing to make it look like the deal is good. It’s up to you to have established your pricing targets before talking to the dealer so that you can easily cut through the bs.

1 Like

You need to look at the deal as a whole. What is the effective pre-incentive discount at base MF?

Edit: typed this the same time as @wam22 evidently :rofl:


My target pricing was what I have in the calculator. The car is very optioned. I am not necessarily looking for an optioned car, my (beginner) logic was that the car with the highest discount is going to be the best lease deal. Obviously it’s incorrect. I am okay with very standard MB C300 4matic, so if I can get a lower monthly with lower discount, I would sign it.

Like it was mentioned earlier, I am not nitty gritty on how they get to my number. I am more “concerned” my research isn’t going well as it seems that simply seeing a discount and getting the MF & RV from Edmunds, and adding all that to the calculator wasn’t getting me an offer with the number I wanted (or anticipated based on the calculator).

I expected caveats, but looks like I missed the huge part :laughing:

1 Like

That is not how you should come up with a target price. I could put any selling price in the calculator, but that does not mean that a Lamborghini is suddenly in my price range.

You need to evaluate what other deals were signed at with the pre-incentive discount and what rebates you qualify for. Look at some broker deals in the marketplace or search the forum for recent deals.


So the lease hacker score is 8.7 years on 20% off and base MF. It’s not what I expected.

Could you clarify that? I calculated based on the base MF

If I adjust your calculator you posted with the base MF and the RV you believe to be correct to be 503 with 1k its about a 20.5% discount off MSRP which still sounds like a pretty amazing deal for a Mercedes Demo.

Well, let me clarify. The calculator was based off of RV & MF from Edmunds, the adjusted RV based on current miles, my state’s tax rate and a vehicle that was advertised with 23% off MSRP. I didn’t make my number up.

I took them from Edmunds. The dealer didn’t offer them to me so depends how “correct” is defined…

The discount online may include incentives you don’t qualify for. You negotiate what you can, if dealer marks up mf, argue discount and mf.

Everything is made up till you get info from dealer, what you’re doing is eyeballing a reasonable amount then basing an offer of that and negotiating till you get where is realistic / where you want.

Commensurate marked up mf with greater discount etc.