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raz,
In a direct answer to your question, yes, BMWFS will negotiate your residual at your lease end. I was in the same situation as you at the end of mine, and even though my residual was higher than market value, I wanted MY car. I knew the history, I knew how it had been treated/driven/maintained etc.
My salesman negotiated the deal for BMWFS, and knocked $3k off of the residual. It's like any other car buying experience. BMWFS likes the transition because they sell a car that they would otherwise roll the dice on at a future auction, and possibly not see the money they were hoping to get. Good luck.
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