Leases, the 2026 Lineup, and How the Money Actually Moves

A lease is not a loan on the whole car — it's a loan on the car's depreciation. The customer pays for the portion of the vehicle's value they use up during the term, plus a financing charge, plus tax and fees. Understanding that one idea makes every other lease term make sense.

The core idea

When a bank finances a purchase, the customer eventually owns 100% of the car's value. When a bank leases a car, it's really predicting two numbers: what the car is worth today (capitalized cost), and what it'll be worth when the lease ends (residual value). The gap between those two numbers — the depreciation — is what the customer pays for, spread over the term. On top of that depreciation, the bank charges rent (interest) for the privilege, expressed through the money factor instead of an APR.

Where each number comes from

Residual value and the base money factor are set by the manufacturer's captive lender — for Mercedes, that's Mercedes-Benz Financial Services (MBFS) — and are not negotiable line items. Capitalized cost is negotiable: it's built from the selling price, minus any dealer contribution, rebates, or trade equity, plus anything the customer chooses to roll in. The only other lever a dealer legally controls is markup on the money factor above MBFS's buy rate — more on that in the F&I section.

The full vocabulary a customer will hear on a lease worksheet, and what each term actually controls.

What happens when the term is up — or when the customer wants out early.

At scheduled lease-end

• Return the vehicle — subject to the disposition fee, mileage overage, and any excess wear charges.
• Buy the vehicle — purchase at the pre-set residual value, either cash or financed as a new retail loan through MBFS or elsewhere.
• Lease or buy another Mercedes-Benz — the most common path; often waives the disposition fee and can roll positive lease-end equity into the new deal.

Ending a lease early

Customers are not "stuck," but exiting early isn't free — the remaining depreciation and finance charges are still owed one way or another. Options include a lease pull-ahead (MBFS periodically offers programs waiving remaining payments to get customers into a new lease), trading the lease's equity (if the car's market value exceeds the lease payoff) toward a new deal, or a straight lease buyout followed by private resale.

The letter identifies the body style / class. The number that follows historically approximated engine displacement; today it signals output/trim tier rather than literal displacement (a "300" isn't a 3.0L anymore in most cases). EQ-prefixed names are the all-electric line, mirrored roughly to their combustion counterparts.

Organized smallest-to-largest within body type. Starting MSRPs are base trim before destination charge and are subject to change — always confirm current pricing against the live configurator or DMS before quoting a customer.

Entry / Compact SUVs

Compact / Mid Sedans & SUVs

Mid-Size Sedans, Wagons & SUVs

Full-Size & Flagship

Performance & Roadster

All-Electric (EQ) Line

National averages — always confirm live rate sheets with your F&I office, since Mercedes-Benz Financial Services runs its own tiered and subvented programs separate from the general market.

Rates have been gradually declining since mid-2024, after climbing from 3.85% (Dec 2021) to 7.89% (July 2024). Experian's Q4 2025 data put "super prime" (highest-tier) borrowers at an average 4.66% APR, versus 16.01% for "deep subprime" — that spread is the entire credit-tier story in two numbers.

How dealer reserve works

When a deal is submitted to a lender, the lender returns a buy rate — the actual rate they're willing to fund based on the customer's credit, income, and the vehicle. The dealer is not required to pass that rate through. Instead, F&I can add a markup — commonly 1–2.5 percentage points, regulatorily capped in that range — and quote the marked-up sell rate to the customer. The spread between buy and sell is dealer reserve, kept as profit. On a $30,000, 72-month loan with a 2% markup, that's roughly $1,800–$2,000 in reserve on a single deal.

MBFS is the captive lender — it sets residuals, base money factors, and runs the subvented rate/lease programs that make Mercedes competitive against APR-driven competitors.

How current programs are typically structured

• Tiered APR financing by term length — e.g., a recent structure ran roughly 1.99% for 24–36 months, 2.99% for 37–48, 3.99% for 49–60, and 4.99% for 61–72 months on eligible models, with G-Class and GLS often carrying their own separate (and sometimes more aggressive) tiers.
• Model-year-specific offers — MY25 (prior model year) inventory frequently carries more aggressive APR and lease cash than current MY26 stock, since MBFS is incentivizing move-through before the new model year fully takes over.
• Loyalty & Conquest credits — loyalty credits for existing Mercedes owners/lessees typically range from roughly $1,000 (EQB) up to $20,000 (Maybach); conquest credits reward customers switching from another brand, usually in the low thousands depending on model.
• 39-month lease structuring — a common MBFS technique uses the 36-month residual value but stretches the term to 39 months, giving the customer three extra months of use at the same residual — which lowers the effective monthly payment without changing how the vehicle actually depreciates.
• One-pay leases — available across the standard MBFS lease program; the lump-sum payment is based on the discounted present value, so effective money factors run lower than monthly-pay leases. GAP is still included.

Illustrative real money factors & residuals (GLE line, pulled from active customer-forum quotes)

Figures above are point-in-time examples pulled from active deal discussions and will not reflect this month's program — always pull the current rate sheet from MBFS/DMS before quoting.

F&I — Finance and Insurance — is the back-end profit center of the dealership and the final stop before delivery. Every deal that isn't paid in cash flows through this office.

• Structures financing — submits the credit application to lenders (captive and outside banks/credit unions), manages buy-rate-to-sell-rate spread, and presents payment options.
• Presents protection products — vehicle service contracts, GAP, tire/wheel, prepaid maintenance, and more, typically through a tiered "menu" presentation.
• Handles compliance and paperwork — ensures required disclosures, fair-lending compliance, and contract accuracy before a deal is funded.
• Manages lender relationships — knows which lenders to submit which credit profiles to, and negotiates buy rates across the credit spectrum.

Even when front-end (vehicle sale) margins compress, F&I often holds up total dealership profitability — finance reserve, service contracts, and ancillary products commonly represent 30–40% of total gross profit per vehicle.

The floor process you run, structured into stages — with what each stage is actually accomplishing underneath the surface.

Everything worth knowing before or as you sit down at the desk — organized by category. You won't ask all of this as a checklist out loud; work it into natural conversation during discovery and let the rest surface as you build the deal.

The standard field set every dealership credit application (and VinSolutions-style desk log) needs to run credit and structure a deal. Get this complete and accurate at the desk so nothing stalls the deal downstream.

Applicant Information

• Full legal name, date of birth, SSN
• Driver's license number and state
• Current address, and how long at that address (many lenders want 2 years of residence history — if under 2 years, get the prior address too)
• Housing status — own, rent, or other — and monthly housing payment amount
• Phone number and email

Employment & Income

• Current employer, position/title, and length of employment
• Gross monthly or annual income
• If self-employed or business owner: business name, structure, and how income will be verified (tax returns, bank statements)
• Prior employer if current tenure is under 2 years

Co-Applicant (if applicable)

• Same full field set as above — name through income — for any co-signer or joint applicant
• Relationship to primary applicant
• Whether both incomes are relied upon to meet monthly obligations (relevant context for the deal structure, not just a formality)

Deal-Specific

• Vehicle of interest — new/used/CPO, year, make, model, stock number
• Trade-in details — year/make/model, mileage, condition, payoff amount and lienholder if applicable
• Desired structure — cash, finance, or lease
• Down payment amount
• References (some lenders still request personal references, especially on thinner credit files)

Common floor objections and how to respond — without touching numbers, which stays with the desk.

Common questions customers ask before the numbers conversation, and how to answer them accurately without stepping into F&I/desk territory.