12-09-2011, 10:35 AM | #1 |
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X3 Lease Rates
Is there any idea when the lease rates may come back to reality for the X3s? I am looking to pick up a 35i -Tech/Premium/Prem Sound/Cold Weather, and this will be our first BMW lease (currently have a Honda lease we are getting out of early).
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12-09-2011, 11:40 AM | #2 |
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what's reality? the current base rate mf @bmwfs afaik is .00195, which you can lower to .00146 with msd [7 deposits]. that's roughly 3.5% financing? is that not reality?
the current residual on a '12 is 54% @15k miles/yr, 36mo. i signed a contract on those numbers 1.5 weeks ago. pcd scheduled for january. do you think reality will be much sweeter? ps. fyi got the mf rates from ridewithg.com, got the residuals from bimmerfest.com Last edited by jk; 12-09-2011 at 11:51 AM.. |
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12-09-2011, 11:53 AM | #3 |
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From the 2 dealers I have spoken to in GA and TN, I am getting lease prices in the high 700s for a 28i stickered at $48K (Prem, Prem Audi,Convenience, Tech) with 12k mi/yr for 39 months, taxes rolled into lease (9.25%) ,drive-offs (1st payment, fees, no sec deposit), and a $495 Cap Red. And again, thats only for a 28i, not a 35i. I thought in reality the payments would be roughly $100 lower for a 35i with the same options.
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12-09-2011, 12:03 PM | #4 |
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from what i've read, you'll get better number for 36 months- apparently that's the sweet spot for them to turn around the vehicle as a cpo, so you get a better residual. the residual is 54% for 15k@36mo, and adjusted 2% for 12k [i.e. to 56%], another 1% for 10k.
i can't speak to the tax issue. do you know what money factor is being used? if not, ask. then pay 7 security deposits to lower the rate by .00007*7=.00049, for a pretty good guaranteed tax free rate of return. there's good info on calculating all the stuff at the 2 websites i mentioned. btw, on my x3 35i with premium, tech, premium sound and sap, with my 6.35% sales tax rolled in, the payment is about 770. you might also check with adrian at s. atlanta. he's a bimmerfest sponsor and a number of board members have spoken well of him as a straight shooter. |
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12-10-2011, 10:13 AM | #5 | |
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12-10-2011, 01:59 PM | #6 | |
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bmwfs is basically saying they think that in 3 years my x3 will be worth 54% of current msrp. my accountant said i'm better off leasing through my business, since i can deduct all the lease charges, while if i owned it the depreciation is limited to about $11k in the first 3 years. |
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12-10-2011, 10:19 PM | #7 | |
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So I think you answered my first question. Discounting the finance charges it looks like it will cost you a little over 7K/year (21.3K/3 years). If you lease or buy you still have finance charges so you have to take that out of the equation, right? Seems like you always have a car finance charge unless you pay cash for the car. So i wonder if after 3 years you decide to sell it privately what is a reasonable asking price? You say that BMW says your car is worth 29K. |
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12-11-2011, 08:16 AM | #8 | |
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12-11-2011, 11:24 AM | #9 | |
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Thanks Jk. Seems like a lease is a good option if you only want to keep the car for 3 years and always have payments. you can just walk away after 3 years and have spent a little over 9K/year including finance charges (in your case). Looks like you didn't put much money down either. If I went leasing route, is it crazy to put down a whole lot of money and reduce payments? |
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12-11-2011, 12:40 PM | #10 |
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I think the reason most people advise against putting a large down payment on a lease is that if your vehicle is stolen or totaled early in the lease, your down payment is lost forever. However, a down payment will reduce the overall cost of the lease because less money is being financed. Some might say you should keep the money and put it in an interest bering account but by my calculations, you save more in finance charges by doing the down payment than you would earn in interest in today's markets. Also, lower payments would look better on your debt to income ratio should you apply for some other credit (like a home mortgage) during the lease. I'm debating the down payment idea myself right now because I have a vehicle I can trade in and lower the lease payments on my X3 dramatically.
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12-11-2011, 01:23 PM | #11 | |
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if you have a limited lump sum to use up front, i think you're better off making 7 security deposits than a down payment. the return from lowering the mf is greater than the finance savings on using that same money as a down payment. otherwise, as pointed out above, the issue is the risk of [financial] loss in an accident or theft scenario. i didn't make ANY downpayment [other than the $500 cap cost credit offered by bmwfs], but i will be putting down 7 security deposit payments [=7*800= 5600] to lower the money factor from .00195 to .00146. if i 1. return the car in good shape, or 2. buy the car in 3 years, or 3. re-lease the car in 3 years, or 4. total or have the vehicle stolen, i will get that 5600 back and will have saved substantially on my finance charges in the interim. |
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12-11-2011, 03:35 PM | #12 | |
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Also, it used to be with inflation, that if you paid off over time you were paying off w inflated $ vs purchase price, etc. plus opportunity cost of paying money up front for cash vs. what it would earn all factor in. With very low inflation rates now , that might be out the window. Anyone have a financial calculator on them? |
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12-11-2011, 04:24 PM | #13 | |
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12-16-2011, 08:26 AM | #14 |
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As an update, we have been in touch wth several dealers, and the numbers have been the same. I think its due to the fact that X3's don't sit on lots much. The cars we are cross shopping are the FX35 (which we are getting very good numbers on w/12k/yr-36mo) and the Q5 (a little less expensive per month that the X3, but not by much). Still have more thinking to do.
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