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      05-23-2008, 12:38 AM   #1
Omnimagus
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Can I do better? Is payment too high?

Not sure if this would be the right place to post about this topic. I first posted over in the Car Ordering section but no one responsed. I apologize if you have read this already.

Anyways I fell in love with the 3 series coupe so now I'm looking to buy one. My budget is limited. I've been thinking ALOT, so I am unclear on some things I was hoping someone here can help me with.

Firstly, what is bad about leasing a car if you can get the car for below MSRP? Every payment you make is reducing your OTD price thus towards the end if you wish to buy the car, you can just buy it outright then right?

2. I was able to find a new 328i coupe that is almost in the US with the following:

Black Sapphire or Jet Black (I forgot)
Navi
Premium Package
Sports Package
Auto w/ Paddles
iPod
(Heated Seats if is Jet Black)

The sticker price was around $44,8XX. Sorry didn't catch the exact number but the dealer was able to take $18XX right off, totaling to $43000. Does this price sound about right? I know I can do a better.

The residual I believe is 58% for a 42 months lease, 10,000 miles per year. I think the mf is .0240. Can they even do 3 and a half year leases???

Basically, what can I work on from here? I wanted to purchase at first but leasing is sound great at the moment. If I wish to keep the car after the lease term, I'll just buy it, would probably need a bank financing which will have a much higher financing rate than the 3.9% BMW has to offer. And if I don't want to keep the car afterwards, I'll just drop it off and be done with.

Am I missing something here? Are my logics way off? Please help. Oh yea with pretty much no money down except 1,500 which included first month payment, taxes, fees, and stuff, my monthly is 690.xx for 42 month, 10,000 miles per year lease. Is that high?

The residual is off of the MSRP price? Ouch.
With a 0.0024 MF that equals to 5.76% APR.

So does that mean if I'm buying AFTER my term expires I'm paying the full sticker price + my 5.76 lease rates + further financing charges if needed?

Thank you very much for your time,
Ryan
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      05-23-2008, 01:21 AM   #2
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tell the dealer to do $2000 off and lets wrap it up. and make sure they throw in the floor mats.
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      05-23-2008, 04:53 AM   #3
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If you have a limited budget, maybe a BMW isn't the right choice for you. With the economy in it's current state, don't put yourself in a position where any minor changes will cause your finances to tighten up too much for you to handle.

If you really need a new car, look for one that still gives you breathing room in your budget. There are plenty of good cars with low cost of ownership, good gas mileage, etc. for alot less then a BMW. Get what you can afford now and look at a BMW later when your finances can better support it.
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      05-23-2008, 05:06 AM   #4
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for 44,8xx just get a 335i
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      05-23-2008, 05:17 AM   #5
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Quote:
Originally Posted by bigpapapablo View Post
for 44,8xx just get a 335i
+1


58% residual on a 48 month lease? That residual doesn't sound right to me. I was at the dealer yesterday and the 335 residual went down to 54% on a 36 month lease anyways at a payment of 680 a month for 48 months, your total is 32,640 dollars. You might as well buy the damn thing by then
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      05-23-2008, 05:41 AM   #6
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budget limited and twin turbo (+chip) 6 cylinder doesn't seem like a wise choice.

You know leasecompare will lease you a used car. Ie 1 year old 328 coupe goes for about $10G off msrp. They will lease it to you at a higher rate but you've just taken a huge cut off the payment since you aren't paying first year dep.

Even better on porsche and audi(S5!) . huge depreciation when you drive it off the lot.

it's a solid idea if you can't swing it. Matter of fact if i had not liked the new car experience i would have done that. It is far more logical.

2007 335i coupe 10K miles prob get it for $36.5K... then lease it for 36 months. check out leasecompare.com

Once you add safelease and safeguard and dinan you had added about $75/month to your payments (but dont finance them use a much lower BT offer)
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      05-23-2008, 06:15 PM   #7
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Thanks for the response

Thank you everyone for taking time to give me some advice.

When I meant limited budget, I meant limited car budget as in only have such and such amount to spend. I definitely still have other investments that can help me offset things if anything were to happen. I like to have some self-discipline especially with a purchase this big. As much as I love the 335, I would prefer to stay alive and avoid insurance premiums. Additionally, since I'm quite tech savvy, I like to have many bells and whistles to things. This also deterred me from ordering a month ago. I was really close on a deal but I just couldn't get myself to do it because technology changes too fast and I'm sure my taste will too. Take my laptop for example, I got four laptops in two years, quite unacceptable behavior but so far still loving my Vaio SZ. I currently drive a bare bone RX350 which is absolutely not fun to drive at all.
What's more is there is nothing to mess around in the car when I am waiting for friends, gf, boredom, and stuff. Would love the Navi which is why I rather get a loaded 328i than a stock 335i. I LOVE my technologies.

Anywhoo, today I called in the dealership and ask for exact numbers as I was unsure on the residual. Turns out that the residual for a 36 month lease is 55% and 52% for a 42 month lease. Money factor is indeed 0.00240 for both leases.
The breakdown of JUST the dealer fees are as followed: Dealer Fees - $389 and Acquisition fee - $825. Acq. fee seems awfully high compared to others where they were around $625-ish :/

If I'm able to get $2500 off the car, $1500 down payment the car will be $644.58 including taxes. Since this would be my first leased car, are any other terms negotiable? I know MF and MSRP can, anything else? Terms are 42 months, 10,000 per year. Where else can I wiggle ?

Starr – I have actually been looking for a used car as new cars are just too much of a depreciating asset for me. I’ve searched and searched and even came across LeaseCompare but was not sure exactly how they operated. Are you saying I could buy a used vehicle from perhaps eBay and then LeaseCompare will buy that vehicle and lease it to me? That sounds exactly what I’ve been looking for if that’s the case.
I would like to thank everyone again for taking their time and offering me some advices and insights. Very much appreciated!
Ryan

Last edited by Omnimagus; 05-23-2008 at 06:15 PM. Reason: Wall of Text!
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      05-25-2008, 01:35 AM   #8
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I would just buy a used one and resale it after 3-4 years if I were you You would end up paying over 32 grand to lease a new one, when you could just buy a used one with low miles and probably have some equity after a couple of years!
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      05-25-2008, 02:22 AM   #9
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i almost got the same stuff on my 328 with 1300 down on a 36 month lease and 15k miles a year i pay 660 with tax and my car was about 44k when i bought it. i got floors mats and bmw t shirt for free lol ps only thing i dont have is the paddel shifters
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      06-03-2008, 11:16 PM   #10
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Quote:
Originally Posted by yoyeewee View Post
tell the dealer to do $2000 off and lets wrap it up. and make sure they throw in the floor mats.
its sad whe we live in a world that we have to wory about if the dealer we are buying our $40,000 dollar cars is going to give us floor mats. when i got my car, i never even mentioned floor mats having leased about 4 mercedes benz in my family. When i picked up my e90, it had all weather floor mats on top of the regular floor mats. It was not until i came on this forum that i found out the floor mats technically do not come with the vehicle.
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      06-06-2008, 11:32 PM   #11
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Granted you are in murky waters leasing a car for that long.. I would never do a lease more than 36months, if you look at the residuals and money factors going from 36 to 48+ you take a big big hit.

June lease rates for the coupe, again notice the MF base rate going from .00185 to .00263.. And remember dealers will add on .0004 which they make profit and you can split that 50/50 with proper negotiation. But again the MF goes to hell after 36 months plus the amount of residual drops significantly.

24 Month Residual 65% of MSRP .00185 Base Rate
36 Month Residual 55% of MSRP .00185 Base Rate
48 Month Residual 40% of MSRP .00263 Base Rate
60 Month Residual 32% of MSRP .00263 Base Rate

Remember the old buy vs lease, leases work very very good for 36 months or less after that usually buying wins out.
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      06-07-2008, 01:03 PM   #12
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Quote:
Originally Posted by AndrewAZ View Post
Granted you are in murky waters leasing a car for that long.. I would never do a lease more than 36months, if you look at the residuals and money factors going from 36 to 48+ you take a big big hit.

June lease rates for the coupe, again notice the MF base rate going from .00185 to .00263.. And remember dealers will add on .0004 which they make profit and you can split that 50/50 with proper negotiation. But again the MF goes to hell after 36 months plus the amount of residual drops significantly.

24 Month Residual 65% of MSRP .00185 Base Rate
36 Month Residual 55% of MSRP .00185 Base Rate
48 Month Residual 40% of MSRP .00263 Base Rate
60 Month Residual 32% of MSRP .00263 Base Rate

Remember the old buy vs lease, leases work very very good for 36 months or less after that usually buying wins out.
Andrew: Do you know the 36 mo MF / Residual for the E93?

Thanks
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      06-09-2008, 09:52 AM   #13
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Could you please explain the Base Rate? Does it relate to Money Factor and if so how?
I had two dealers use two different money factors on the same day on the same vehicle and lease terms.
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      06-10-2008, 03:12 PM   #14
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Quote:
Originally Posted by odiesback View Post
Andrew: Do you know the 36 mo MF / Residual for the E93?

Thanks
Go to leasecompare.com and they have all factors listed.. But the E93 factors right now suck..

2008 BMW 335i Convertible
24 Month – Residual 65% of MSRP – .00215 Base Rate
36 Month – Residual 54% of MSRP – .00215 Base Rate
48 Month – Residual 42% of MSRP – .00263 Base Rate
60 Month – Residual 33% of MSRP – .00263 Base Rate


Right now they best deal is on the 328i sedan, its got a residual just 1% higher than a 335i but the MF difference .00165 vs .0021 (Base rates) so a dealer can add up to .0004.

Last edited by AndrewAZ; 06-10-2008 at 03:31 PM.
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      06-10-2008, 03:28 PM   #15
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Quote:
Originally Posted by krypton View Post
Could you please explain the Base Rate? Does it relate to Money Factor and if so how?
I had two dealers use two different money factors on the same day on the same vehicle and lease terms.
Base rate is the same thing as money factor.. Base rate is what BMW gives out. If you are given the base rate forma dealer they make 0 profit in financing on you. So BMW allows dealers to add up to .0004 onto the base rate which is how they make more money off you.. Now like everything when buying a car you can negotiate it, its not uncommon to get an agreement to split that .0004 50/50 aka reducing the mark up on the MF to just .0002.

Generally people make errors in leasing by just looking at the monthly payments. Dont concentrate on the monthly payments..


First step to leasing a car is.

1. Negotiate the purchase price. I wouldn't pay more than $500 above invoice for a lease car.
2. Money factor, know your base rates (Go to lease compare and they list the base rates). Negotiate your MF rate try a 50/50 split.
Once you have done the above always put down the minimum down payment which is usually licensing and taxes plus a security deposit.
3. Residual values are fixed so this doesn't matter the only thing you can change about a residual value is if you need more miles, generally going from 10k miles a year to 15k miles a year lease you subtract 3% off the residual value.

If you do that and ignore everything else you should end up with a good deal.. DO NOT DO NOT LET the sales guy make you an offer, you make them the offer. Its much easier to start off that way since you asking for a good deal vs having a sales guy who thinks you are retarded and knows nothing about leasing trying to get you to put down $5k and pay $800 a month its harder to get him to work down to putting $1k down and paying only $600 a month..

Just another tip, get on the internet and search for a few dealers, in my town I have 3 BMW dealers, so what I do is send out an email to the internet sales manager saying I want X car with X options and I am willing to pay X over invoice and a MF of ___ can you do that.. They will generally come back with a no but an offer use that offer to email another dealer you have gotten a response form saying X dealer is offering me X can you beat it.


My best advice is make an excel spread sheet.

Have the following labels on the top row

Cap cost, Residual %, Residual value, Term, Depreciation fee, Money Factor, Finance Fee, total monthly, total cost.

Here are some pictures of my excel sheet I use, one shows the formulas.. I do a lot of work before going into the dealer and usually end up not needing to take my laptop with me but usually keep it in the car just in case.

But one thing play around with money factors in the excel they make a big difference. And basically the excel sheet shows you how much you are paying for the deprecation of the car and to financing. And the MF aka financing fee is usually what ends up screwing you. Remember MF * 26000 = interest rate.
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      06-16-2008, 05:22 PM   #16
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Thanks Andrew, Your speadsheet is very handy.

Not sure what you mean when you say split the MF 50/50? So far I've negotiated a 335xi at invoice w/a base MF for June of .0021. Can I try and negotiate the MF with my dealer to .00105?
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      06-17-2008, 05:07 PM   #17
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Quote:
Originally Posted by Mero View Post
Thanks Andrew, Your speadsheet is very handy.

Not sure what you mean when you say split the MF 50/50? So far I've negotiated a 335xi at invoice w/a base MF for June of .0021. Can I try and negotiate the MF with my dealer to .00105?
Yes.. You can negotiate the dealer down to the buy rate if they are trying to move cars..

Right now I am in the process of leasing another car and I have them down to a tad below invoice and at the buy rate for the money factor.
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      06-18-2008, 12:36 PM   #18
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Quote:
Originally Posted by AndrewAZ View Post
Yes.. You can negotiate the dealer down to the buy rate if they are trying to move cars..

Right now I am in the process of leasing another car and I have them down to a tad below invoice and at the buy rate for the money factor.
Good to know! Thanks!
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