[Bilbofraggins]

I've never leased a vehicle...I don't own a business...I know nothing about leasing, never inquired or considered it.

We usually keep our vehicles past the 48 month point. In this case, we added extended warranty to 7 years/140,000Km (way more than needed in my wife's situation).

Background, we just bought a leftover 2019 with factory hitch and 21" rims, 053km on delivery. Apart from that it's just a base M40i...or more importantly, the one my better-half picked.

She turned down ones with BMW Individual leather....its a daily driver and the occasional long trip. To be honest, a 2020 with normal discounts for loyalty etc, may have been the better product.

My next vehicle-out-the door is my 2013 X6M...wondering if the next one should be leased...or is it a status quo. Although, I have no plans to let the beast go.

This thread, is not really about options and the effect on the selling price...or even the selling price which of course is a massive factor.

I'm just intrigued to know what plane-jane average lease payments are and duration....

Input appreciated:

M40i, X Months, X Bucks....

Yours aye, Fraggins X6///M

[asyvan]

In general financing, leasing is a way to lower the risk and avoid a huge capital expense. It has a price as anything, that the overall cost is most likely higher.

Lowering the risk: This is by removing the insecurity of depreciation (and in the long run, repair costs) and moving to a fixed monthly fee. It has a price of course, the leasing cost is usually higher than if you owned the car yourself and financed it through a loan.

Avoid a huge capital expense: Even if you take a loan on the car, and not use leasing, you most likely will face a requirement of 20% as a capital expense. If you have that money in a previous car (trade in) or on your bank account then it's fine. Otherwise leasing is a way to get you a new car without a capital expense, but at a higher total cost.

Not sure this is what you wanted to hear though.

[Bilbofraggins]

That is much appreciated... some great background comments to get me and possibly others going...

[6ixSpd]

We also scooped up a last of 2019 inventory brand new M40i, although it has Ultimate Package and 21s. With the insanely low 0.99% finance rate (and another 0.75% off due to Loyalty bringing it to 0.24%) BMW had in late November, the implicit cost of borrowing was only $670 over 60 months. That's the lowest cost of borrowing charge I've ever seen from a German luxury brand new car.

In our case, leasing a 2020 30i with similar options was coming out to cost more per month and more paid in interest. And paying $10/month in interest on a $80k vehicle is absolutely incredible and one would have to be very foolish to even consider paying cash in this case.

It all comes down to what you're comfortable spending per month, the rates/costs of borrowing involved, and your personal preference for car use (long term ownership vs. cycling every few years).

And lots of people prefer to lease simply because they can get a new car in 4 years, not many actually keep their vehicles longer than that these days. In this scenario, you're basically renting a car for many years and have to accept that monthly expense as money forever gone.

[blschaefer1]

Originally Posted by asyvan

In general financing, leasing is a way to lower the risk and avoid a huge capital expense. It has a price as anything, that the overall cost is most likely higher.

Lowering the risk: This is by removing the insecurity of depreciation (and in the long run, repair costs) and moving to a fixed monthly fee. It has a price of course, the leasing cost is usually higher than if you owned the car yourself and financed it through a loan.

Avoid a huge capital expense: Even if you take a loan on the car, and not use leasing, you most likely will face a requirement of 20% as a capital expense. If you have that money in a previous car (trade in) or on your bank account then it's fine. Otherwise leasing is a way to get you a new car without a capital expense, but at a higher total cost.

Not sure this is what you wanted to hear though.

Leasing has other advantages related to risk and diminished value in the event of an accident and the car is repaired. If you own, you assume the diminished value risk. If you lease, the finance company does.

[Bilbofraggins]

Originally Posted by blschaefer1

Leasing has other advantages related to risk and diminished value in the event of an accident and the car is repaired. If you own, you assume the diminished value risk. If you lease, the finance company does.

Interesting comment...Thanks.

[Bilbofraggins]

Originally Posted by 6ixSpd

We also scooped up a last of 2019 inventory brand new M40i, although it has Ultimate Package and 21s. With the insanely low 0.99% finance rate (and another 0.75% off due to Loyalty bringing it to 0.24%) BMW had in late November, the implicit cost of borrowing was only $670 over 60 months. That's the lowest cost of borrowing charge I've ever seen from a German luxury brand new car.

In our case, leasing a 2020 30i with similar options was coming out to cost more per month and more paid in interest. And paying $10/month in interest on a $80k vehicle is absolutely incredible and one would have to be very foolish to even consider paying cash in this case.

It all comes down to what you're comfortable spending per month, the rates/costs of borrowing involved, and your personal preference for car use (long term ownership vs. cycling every few years).

And lots of people prefer to lease simply because they can get a new car in 4 years, not many actually keep their vehicles longer than that these days. In this scenario, you're basically renting a car for many years and have to accept that monthly expense as money forever gone.

I didn't even ask what the fiance rate was....I guess I should have...would have taken it...We just let our last 6 speed manual go...an E90 with a proper engine....sold on Kijiji in 3 hours...Maintained, looked and drove like new.

[blschaefer1]

Another advantage to leasing - the finance company assumes the risk on extreme depreciation of the vehicle. It's on you if you purchase.

You can purchase the vehicle at any time during the lease term. Let's say you love the vehicle, and at the end of the three year lease you want to purchase it. You can purchase it for the residual value. If the residual value is below market value, great, you win.

But what if that residual value is above market value for the car? Give it back, lease another new car. You win that way too.

Also, on the subject of taxes, most states only require you to pay taxes on the depreciated portion of the car, not the entire amount as would be the case if you purchase instead of lease. If you change cars every few years, this can be a significant savings.

The only real downside to leasing is slightly higher fees (acquisition, etc.) up front, and a possibly higher finance rate.

Having said all this, I bought my M40i because the I had clean title on a trade that minimized my tax liability and the incentives were higher from BMW finance on purchase vs lease.

[JamnX3]

Thanks for the summary. My lease ends March 2021. How early do you recommend leaving a leave? 6, 3 , 1 month before lease ends. I'm new to leases and want to make sure I take full advantage of all options.

I love this vehicle, but was thinking about the PHEV to get me in the car pool lanes.