How does a scenario of the market going back to normal have any possibility of selling the car for today’s buyout plus approximately $3,000 in tax?
In a normal market that car would be underwater today, as the best German lease deals have usually relied on inflated RV.
That’s why I said anything lower than buy out up till 6k is still cheaper than leasing a new car.
Wasn’t saying that they can sell it for that buyout + tax
Just laying out best to worst case scenario
Of course, that’s assuming the Benz doesn’t need any major repairs or maintenance in the next year as the warranty will be up. Heck, tires/brakes will run over 2K!
I bought out my Audi at lease end (36 months), and literally a week later the steering rack failed. It would have been a $3000 repair. Fortunately, Audi was very kind and smart…this was the initial year of the A4…the car that turned around Audi’s fortunes after their acceleration/braking fiasco, and I think they wanted to be on their best behavior…no bad press or opinions.
Agreed & i am against buying out luxury SUVs after the lease.
My original solution has been to extend.
I was just laying out some scenario to the question posted by another poster about losing the 9k in equity.
It was under a 48month warranty, wasn’t it?
You keep mentioning this for scenarios 2 & 3 as if scenario 1 doesn’t require buying/leasing another car after selling this one.
But by then market is normal…LH score of 10+ so the payment will be like low $400s , right?
Even in a ‘normal’ market well-specced GLCs were never easy to get with a LH score like that. To get a payment low enough for a 10+ score you’d need to somehow be at least 10-15% off MSRP and with an almost interest-free MF, or pricing only a very stripped-down base FWD model. MB never incented GLCs that aggressively any time that I remember. Would be interesting to hear how the OP landed the current ~500/month deal to see if its realistic that the scenario would ever repeat itself, even once the extreme market pressures are gone.
I recall it being out of warranty…it was nearly 25 years ago…I can’t remember what I had for breakfast!
The deal was at 16% off MSRP. Didn’t do anything special besides getting quotes from a bunch of dealers and getting the most decent one to go a bit below the lowest price offered. It was at $455 + tax, roughly around $499 and change.
As someone mentioned, I like the idea of putting some (or all of $9k) toward the next lease and enjoy another brand new car, especially you really like Benz.
If the market gets better, you won’t get $9k at that time, and you’ll stuck with a 4-yr old car.
If the market gets worse, the chance you have the same decent ride is kind of unknown because there is chance you won’t get $9k (your car has more mileage)
I guess that happened a lot back then! I used to get similar offers on X3s, but never seriously shopped MBs.
Sounds like you know all the inputs, so in my mind the decision isn’t just a math problem or financial 4D chess. I think the key questions are:
How badly do you need/want to pocket the equity in your current GLC? (Sounds like not a major priority)
How badly do you need/want to drive the car you like or a close equivalent? (Sounds like a high priority)
How much room do you have in your budget for a higher payment? (Sounds like you want to stay in the same range)
Finally, maybe the most key question to the buyout or trade-in question - will you be happier just knowing you’re driving something you like, and whats done is done with the numbers, or will you be happier feeling like you bought yourself time to make a decision and feel like you got a good deal?
Cash the $9,000 check and sleep on it.
Guarantee all these thoughts of putting $9,000 down on your next lease will disappear.
Better yet, cash the check, pull out a stack of 450 $20 bills and sleep on that.
I think you got my priorities correctly. It’s not about “making $9K”, that’s not a priority. It’s really the decision between buying out the existing GLC or leasing new. I think in my case (where an extra $20-50/month doesn’t really matter), we’d just lease a new GLC.
It’s unclear to me that the market will stabilize in a year, so it may be a case where the current GLC is out of warranty, supply chain is still disrupted, who knows what other virus will land here, etc. But I think in 3 years things will be stable.
So yeah, this is less about “a solid financial decision” I guess.
You should really verify first if MB allows 3rd party dealer buyout anymore. When I tried to sell my MB last month Vroom came back after a week saying that they won’t buy MB lease. I got email from Carvana recently that they stopped buying MB lease. Your only options will be to sell to a MB dealer or buy yourself and sell within 10 days to avoid tax. In any case the payout can be vastly different. I saw the offer fluctuating by $2.5k within a week.
MB stopped fully on 9/1. The 3rd parties just started earlier because they knew what a pain it would be if something delays it.
Is that confirmed by MBFS? I got this email from Carvana which did it state anything about MB stopped selling to 3rd party:
“ Thank you for taking the time to submit your vehicle for a value with Carvana. At this time, we are not able to move forward with purchasing your leased vehicle as Carvana’s policy does not align with Mercedes-Benz policies, and this prevents us from being able to purchase leased vehicles from this provider.
We do apologize for any inconveniences at this time and hope that you’ll consider Carvana in the future for any vehicle purchases and/or sales.”
If it’s confirmed by MB then this wiki needs to updated: List of Lenders that Charge Third-Party Buyers a Higher Payoff - #201 by forbs.
I don’t know if there is an ‘official’ but this post says 9/1
I’m not sure your question has anything to do with the brand of your car. It is simply should you buy out your current lease or should you lease a new car - isn’t it? I don’t think anyone knows when the market will stabilize - I had an analyst tell me it would be Q1 2022 and I was on a call with an electronics company who said 2023 so who knows.