[jetblk328i]

yea i thought that when bargaining, dealers would be willing to lower the price more if paying with cash because in 4 years, they wont get the car back and have to sell it, unless its traded in, less trouble for the dealer. hmm

[QwaZyWabbiT]

Originally Posted by canucklion

^Qwazywabbit, so in you opinion (I know you're a CA), leasing is the best choice, financially, when buying new?

By far. The cost of money (money factor=rate) is lower than any finance rate you can get. Compared to cash, why on earth would you want to pay for the depreciation? If you stick that much money into any online bank account (ING for example) you will get 5% on your money. The rate for the lease is around 4-5 %. You would lease for close to nothing, in addition to have ZERO risk ie, if you wreck the car.

Example:
Pay cash:
48,000 335i (prem, sprt, auto, heat, ca, sat.)
54,000 out the door paying cash. The car will be worth around 30,000 at the end of 3 years (close appr.)
Total out of pocket for 3 years --54,000+tires and alignments

Finance:
10% down (4,800)
60 month note with 7.9 (market average in U.S.)
=960 month

total out of pocket for 3 years: 38400 (960x35 months + 4800 down)

However when leasing: using hypothetical numbers
36/15mi per annum
2k up front 700mo plus tax ;residual is 31,500
700x35months=24500+2k up front=26,500 total out of pocket for 3 years.
The 54k has been working for you the entire time gaining you interest, offsetting the money factor.

Plus when you own the car (finance or cash) you are at risk if anything happens to the car. If you have a wreck, and it cost 12k to fix (happend to me with my 335) then your precious car will be worth 12k less regardless of whos fault it may be. The market value for the car will drop like a rock in a pond. If you had leased the wrecked car, you are not penalized financially at all--you just turn the car in and walk away. But if you owned the car, you take the hit. Same goes if it is a total loss for whatever reason.

Next question...........

[canucklion]

thanks for your reponse, nice to hear from a CA regarding this topic

Originally Posted by QwaZyWabbiT

By far. The cost of money (money factor=rate) is lower than any finance rate you can get. Compared to cash, why on earth would you want to pay for the depreciation? If you stick that much money into any online bank account (ING for example) you will get 5% on your money. The rate for the lease is around 4-5 %. You would lease for close to nothing, in addition to have ZERO risk ie, if you wreck the car.

Example:
Pay cash:
48,000 335i (prem, sprt, auto, heat, ca, sat.)
54,000 out the door paying cash. The car will be worth around 30,000 at the end of 3 years (close appr.)
Total out of pocket for 3 years --54,000+tires and alignments


However when leasing: using hypothetical numbers
36/15mi per annum
2k up front 700mo plus tax ;residual is 31,500
700x35months=24500+2k up front=26,500 total out of pocket for 3 years.
The 54k has been working for you the entire time gaining you interest, offsetting the money factor.

Plus when you own the car (finance or cash) you are at risk if anything happens to the car. If you have a wreck, and it cost 12k to fix (happend to me with my 335) then your precious car will be worth 12k less regardless of whos fault it may be. The market value for the car will drop like a rock in a pond.

Next question...........

[QwaZyWabbiT]

Originally Posted by jetblk328i

yea i thought that when bargaining, dealers would be willing to lower the price more if paying with cash because in 4 years, they wont get the car back and have to sell it, unless its traded in, less trouble for the dealer. hmm

Things in a BMW dealership work a bit different than that.

[QwaZyWabbiT]

Originally Posted by canucklion

thanks for your reponse, nice to hear from a CA regarding this topic

Anytime man. I will anwer any question you have.

By the way, I edited that post to include the finance numbers.

[BMW F22]

let's put it this way: Brand new>demo>loaner

[jetblk328i]

cool, thanks man now, do you have any numbers on what the loaner with SG, auto, htd seats, and 6000 miles should go for? oh and the deep green with auto and htd seats brand new, as in what would my friend expect to pay?

[achien]

Originally Posted by canucklion

thanks for your reponse, nice to hear from a CA regarding this topic

Beware, CA have their own agenda. The dealership can only make more money off you, by becoming a bank, if you lease or finance.

[QwaZyWabbiT]

Originally Posted by jetblk328i

cool, thanks man now, do you have any numbers on what the loaner with SG, auto, htd seats, and 6000 miles should go for? oh and the deep green with auto and htd seats brand new, as in what would my friend expect to pay?

Unfortunatly, I dont know. The reason is your market is priced out different than mine (Atlanta). Keep in mind it is not CPO, therefore you may think about calculating .75 to 1.00 off per mile.

[QwaZyWabbiT]

Originally Posted by achien

Beware, CA have their own agenda. The dealership can only make more money off you, by becoming a bank, if you lease or finance.

Although we do make some money on the backend, it typically works out to be a couple hundred dollars--your institution will make much more than that. So to the BMW dealership, its doesnt matter to us how you pay for your car--its a cash deal to us no matter what--either you pay us or the bank pays us. People allow us to broker out rates because typically we can get cheaper wholesale rates than what a client can get on their own. For example, I had a client who got 6.79 from the credit union they have been with for 22 years. He had a 814 equifax beacon. We were able to get him 6.49 through one of our primary lenders.

Keep in mind, on the back end we make our money on the products we offer. They are products that the customer will benefit from. Usually the only ones I find that people absolutely benefit from are a Road Hazard protection plan and, if they lease, Insurance for lease turn in against excess wear and tear.

[jetblk328i]

ok so in that case the loaner should be around 31000 oe 30500? and i guess the new should be 33750 or 34ish that sound right?

[JmanE55]

Originally Posted by montreal_bimmer

the Brand Spanking New Car for sure....


is this a trick question???

+1 for the new one.

[QwaZyWabbiT]

Originally Posted by jetblk328i

ok so in that case the loaner should be around 31000 oe 30500? and i guess the new should be 33750 or 34ish that sound right?

Again, I am not sure. The one with 6k miles is a bit difficult for me to advise on. The new one with 3-100 miles should be market rate, or what you are able to negotiate. On the new one, do NOT expect the same discount as the one with 6k miles. Perhaps checking an indepentent resource like edmunds.com TMV will help you. Regarding the loaner, it is less expensive, but not necessarily a better value. Loaners are typically treated like an enterprise rental car.

[jetblk328i]

hah i got a camry for my lexus and i killed it so bad, anyways i based the new one as 500ish over invoice

[QwaZyWabbiT]

Originally Posted by jetblk328i

hah i got a camry for my lexus and i killed it so bad, anyways i based the new one as 500ish over invoice

case in point If you want 500 over invoice, what is your plan?

[jetblk328i]

i will tell my bud to get the new one however if that one is sold, then he will get the loaner because he wants to buy one TODAY and hes tired of shopping hah.

[QwaZyWabbiT]

I wish you luck. Tell him welcome to the BMW family and HAPPY DRIVING!!!

[jetblk328i]

yea he had his another car set but when he called the dealer yesterday, the car was slod 2 hrs ago so hes had a long journey. oh and what would you say, he plans on going to wisconsin and basically a 1000 mile road trip, would you say, to if it is the new car, to take it easy and not push it?

[theYardie]

Originally Posted by jetblk328i

i will tell my bud to get the new one however if that one is sold, then he will get the loaner because he wants to buy one TODAY and hes tired of shopping hah.

Yo man, talk your buddy out of the loaner. Two years ago my fiance bought a loaner, albeit a Volvo, and we started regretted it after year 1. It drove very nice initially. The car now drives like it's been beat up. It's not worth it, you really run the risk of just pissing money away. Now if he is able to lease the loaner that may make more sense.

By the way, I agree with everything Qwazy wrote about leasing vs buying. That's how I approached my lease even though I MAY buy the car eventually. That's only if it turns out to be a good trusty car mechanically and after I factor other things such as market value vs residual when the time comes.