# Lease Extension Fact vs. Fiction



## quackbury (Dec 17, 2005)

My 2017 540 comes off lease the end of this month, and I've been on the fence about extending while the COVID plays out. I've seen posts on here about a fantastic offer: extend your current lease for 2 months at a 50% reduction in payment. "Wow!", I thought, "That sounds terrific!"

I spent half an hour on the phone with the Lease End folks at BMWFS yesterday. According to them, that program does not exist. "Yeah, we've been getting calls about that. It's a rumor on the internet. We will be happy to give you a 6 month extension, which you can end early, for YOUR CURRENT LEASE PAYMENT. There is no super-duper 2 month 50% off program."

So does the 6 month, full price payment make sense? It may.

Like every lease before, I am over miles on my current lease. I always buy the extra miles the day I return the car, at the discounted rate of 23 cents per mile (24.5 cents per mile with sales tax). I'm hardly driving these days. Extending my lease gets me 1,250 additional miles for every month I extend. If I only drive the car 500 miles this month, that means 750 miles get credited against my over-mileage at lease end, and those 750 miles will save me +/- $185 when I finally do turn the car in. Better than a sharp stick in the eye, but certainly not the 50% savings that have been rumored.

But following that strategy would also mean I'd be on the hook for scheduled maintenance, plus anything that breaks. Not worth it. Besides, I need that new car smell.

It's possible the guy I spoke with at BMWFS was wrong, so if anyone here has actually gotten that half-price lease extension, please post your story. My friend the French model likes to tell me that if it's on the internet, it must be true, but in this case he appears to be mistaken.


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## 1968BMW2800 (Aug 13, 2016)

Get the new car, Quack. Move on. Smell the ether. It will make you almost happy.


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## Shon528 (Oct 3, 2003)

I am almost inclined to believe that it is on a case by case basis and depends on who you're speaking w/ at BMWFS. Quack, myself, and one of the gentleman that has posted about receiving the free month and 50% off offers are in the same area and shop at the same dealers. I'm willing to bet that there is no official offer, but the provision is there.


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## ctorrey (Mar 17, 2007)

I just posted this today on another thread. Scroll to post #40 for my experience...

https://www.bimmerfest.com/forums/showthread.php?t=1374529&page=2


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## dll2k4 (Feb 6, 2010)

I am on the fence for a late summer M340i ED.

I've not seen any success in obtaining a two-month extension at 50% of the normal payment, but I did extend my lease for one month at 50% off. I also have the ability to extend up to an additional 5 months at the normal monthly payment.


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## shakes (Mar 15, 2007)

I received a complimentary month lease extension on my 2018 430xi gran coupe. It expires May 27th. I have a new car ordered that is shown as "at the dealership," but my salesperson has been furloughed and no one has contacted me yet. I'm still weighing my options since I'm not driving anywhere.


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## Ibiza (Jun 15, 2007)

I expect BMWFS future offer's to improve, as I just was provided a bulletin this morning that my 2020 M4 vert order will probably be cancelled by BMW, as "M4 Convertible: Limited production in run-out June with no replacement afterwards". 

"The ramp up period will affect the output in May and June where production will be lower than our initial planned and allocated production volume for April and May. As a result, not all the vehicles that are currently "On Order" will be produced and the majority will have to be removed from the system". 

BMWNA and BMWFS is going to have an issue with the used car market being flooded, as I'm not going to extend my current 2018 F83 at the current lease terms, considering it has the ED lease modifier, higher MF than what is presently offered, and lower residual. I'll ground the lease, as I can drop down one car (2018 X5M), while I wait for the G83 latter next year. 

Do you have a car to fall back on? I remember that you have a new car on order?


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## RangerWalker (Feb 9, 2008)

ctorrey said:


> I just posted this today on another thread. Scroll to post #40 for my experience...
> 
> https://www.bimmerfest.com/forums/showthread.php?t=1374529&page=2


That's a very informative post. You did all that via messaging on the MyBMW site? I have to say, when I spoke with someone at BMWFS, they offered nothing other than the 6 month extension at same payment. I'm inclined to just return it and move on. My lease ends mid-June.


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## quackbury (Dec 17, 2005)

Yeah, I ordered back in January, and the car has been sitting at the VPC for 6 weeks now. But I am having second thoughts.

I ordered a virtual duplicate of my 2017, main differences being I deleted the ventilated and massaging seats, and added Driving Assistant Plus. My 2017 was perfect for my pre-COVID life, which included a lot of long (250 mile) drives to see clients., with inevitable traffic jams. The ZDB was going to be my new toy; other wise I was replicating my 2017, except for the tach which now goes in the wrong direction. It was a useful business tool, safe, reliable, and moderately fun to drive.

I was locked on the January deal, which I thought would only get better as the MF dropped. But my "new" payment would actually be about $100/month higher than my existing one (except for the payment waivers the first 2 months), and I'm doing no business travel now. Maybe it's the 'Rona, but I'm a lot less excited about another executive saloon right now. So I am exploring all my options. I'm thinking my next car after this one will be an M440i vert, so all I really need to do is tide myself over till they are built and de-bugged.

An F33 440 vert or M4 vert might be just the ticket. I've been looking at Swap-a-lease and Leasehackr. I prefer to think of it as "helping someone out of a jam" rather than "profiting from someone else's misfortune". The great thing about going on Swap-a-lease is being reminded how many folks are completely inept when it comes to negotiating leases, and pay a ridiculous "stupidity tax" every month. Nonetheless, there are a couple of incentivized deals which would cost a lot less than my "new" 540, and get me through till the M440 arrives. And there are a couple of killer deals on new or demo cars available on Leasehackr that benefit from the current low MF and payment waivers.

Would I feel badly about not taking delivery? Maybe. But it is a beautiful build and I'm sure they would find a home for it in short order. Probably more profitably than my mini deal. And the dealer has been remarkably non-communicative, so I will tell myself its his fault he let me wriggle off the hook. In the interim? It's fun to be actively car shopping. Much more so than listening to the MSM amp up their doom and gloom narrative.


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## 1968BMW2800 (Aug 13, 2016)

quackbury said:


> Yeah, I ordered back in January, and the car has been sitting at the VPC for 6 weeks now. But I am having second thoughts.
> 
> I ordered a virtual duplicate of my 2017, main differences being I deleted the ventilated and massaging seats, and added Driving Assistant Plus. My 2017 was perfect for my pre-COVID life, which included a lot of long (250 mile) drives to see clients., with inevitable traffic jams. The ZDB was going to be my new toy; other wise I was replicating my 2017, except for the tach which now goes in the wrong direction. It was a useful business tool, safe, reliable, and moderately fun to drive.
> 
> ...


Wise words, clear thinking.


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## dkreidel (Aug 24, 2005)

quackbury said:


> Yeah, I ordered back in January, and the car has been sitting at the VPC for 6 weeks now. But I am having second thoughts.
> 
> I ordered a virtual duplicate of my 2017, main differences being I deleted the ventilated and massaging seats, and added Driving Assistant Plus. My 2017 was perfect for my pre-COVID life, which included a lot of long (250 mile) drives to see clients., with inevitable traffic jams. The ZDB was going to be my new toy; other wise I was replicating my 2017, except for the tach which now goes in the wrong direction. It was a useful business tool, safe, reliable, and moderately fun to drive.
> 
> ...


Where were you when I had to "give" Carmax my '18 440xi Individual vert with only 11,000 miles? 2 sets of forged HRE wheels and tires, Dinan Stage 1, Merino leather, ...


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## namelessman (Dec 23, 2004)

quackbury said:


> I was locked on the January deal, which I thought would only get better as the MF dropped. But my "new" payment would actually be about $100/month higher than my existing one (except for the payment waivers the first 2 months), and I'm doing no business travel now. Maybe it's the 'Rona, but I'm a lot less excited about another executive saloon right now. So I am exploring all my options. I'm thinking my next car after this one will be an M440i vert, so all I really need to do is tide myself over till they are built and de-bugged.


The thought process should be similar to many customers looking for new cars. E.g. some in my circle of contacts did/will back out of ordered cars, and instead ponder to get back to basics, like a mid-range Civic/Accord, no kidding!


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## Ibiza (Jun 15, 2007)

quackbury said:


> I was locked on the January deal, which I thought would only get better as the MF dropped. But my "new" payment would actually be about $100/month higher than my existing one (except for the payment waivers the first 2 months.


I assume that the "locked" expired due to closure of the VDC. Did the residual drop that's the $100 price difference.

My estimate lease payment was going to drop around $200 from the 2018 M4 vert to 2020 M4 vert-- only difference was 2018 had individual paint at $1950 to 2020 with $550 SMB and Apple Car Play is now included.

I'm sure if you decide to "walk", BMW NA and the Center should make it right-- otherwise, an other lost sale.


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## Ibiza (Jun 15, 2007)

namelessman said:


> The thought process should be similar to many customers looking for new cars. E.g. some in my circle of contacts did/will back out of ordered cars, and instead ponder to get back to basics, like a mid-range Civic/Accord, no kidding!


BMW NA sent a bulletin out today that a lot of orders that were accepted at 111 status will be cancelled due to incorrectly estimating the factory and suppler network ramping up production for April and May prior to the model year change over in July-- customers who want to purchase, can't.


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## Ibiza (Jun 15, 2007)

dkreidel said:


> Where were you when I had to "give" Carmax my '18 440xi Individual vert with only 11,000 miles? 2 sets of forged HRE wheels and tires, Dinan Stage 1, Merino leather, ...


I remember your 2018 build, just seems like yesterday, as it was beautiful.


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## ams3141 (Apr 25, 2017)

Ibiza said:


> BMW NA sent a bulletin out today that a lot of orders that were accepted at 111 status will be cancelled due to incorrectly estimating the factory and suppler network ramping up production for April and May prior to the model year change over in July-- customers who want to purchase, can't.


Curious, does this only apply to MY20s? I'm starting the process of contacting dealers to see when I might be able to build a 2021 330e so hopefully I can still move ahead with that.


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## namelessman (Dec 23, 2004)

Ibiza said:


> BMW NA sent a bulletin out today that a lot of orders that were accepted at 111 status will be cancelled due to incorrectly estimating the factory and suppler network ramping up production for April and May prior to the model year change over in July-- customers who want to purchase, can't.


Wow this is unprecedented. The same can be true even for econo brands, so maybe backup plans(e.g. motorized skateboards? ) need to be seriously considered ....


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## CTSoxFan (Oct 20, 2006)

dll2k4 said:


> *I am on the fence for a late summer M340i ED*.
> 
> I've not seen any success in obtaining a two-month extension at 50% of the normal payment, but I did extend my lease for one month at 50% off. I also have the ability to extend up to an additional 5 months at the normal monthly payment.


I hope this is already booked since they are not taking any orders after 5/18/20...

https://www.bimmerfest.com/forums/showthread.php?t=1379415


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## dll2k4 (Feb 6, 2010)

CTSoxFan said:


> I hope this is already booked since they are not taking any orders after 5/18/20...
> 
> https://www.bimmerfest.com/forums/showthread.php?t=1379415


Thanks and indeed, I received a production number in early March for a 7/9 pick up. I am fully prepared to travel, the only question remaining is whether Germany will let us in the country with no quarantine requirement.

The pre-COVID plan was to visit eight countries over 6 weeks, but the prospects of that are not looking great. Our schedules could allow for pushing the ED back to early August for a quick two-week jaunt, but no later.

Hoping for the best...


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## Ibiza (Jun 15, 2007)

ams3141 said:


> Curious, does this only apply to MY20s? I'm starting the process of contacting dealers to see when I might be able to build a 2021 330e so hopefully I can still move ahead with that.


Orders that were accepted, such as status 111, that will now not have a MY2020 June 2020 build will be changed to a MY2021 starting with July 2020 production. If the customer declines, BMW and the center are suppose to work with the customer, as this also includes any price changes for MY2021.

You simply can not flip on a switch and expect factories at 100% efficacy, as the tier 1 suppliers and their suppliers have to ramp up production, especially as BMW Group uses just in time production.


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## gkr778 (Feb 8, 2013)

quackbury said:


> Rant of the Day:
> 
> I've been mentally replaying my dealer visits yesterday, and some different dealer websites I visited. It dawned on me: Every dealer in a 100 mile radius has 5 to 15 brand new, low-price 228 GC's in inventory. Front Wheel Drive BMW's! Designed for and marketed to newcomers to the marque, likely coming from a Corolla, Civic, etc.
> 
> ...


Yes, F44 is assembled at the Leipzig plant and yes your sense of entitlement knows no bounds.


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## 1968BMW2800 (Aug 13, 2016)

gkr778 said:


> ... and yes your sense of entitlement knows no bounds.


What? Priority delivery of a P1 order? Delivery at the price and terms understood at time of order? For a serial leaser/loyal-to-the-brand returning customer?

It is true, by definition, all BMW customers run along the "entitled" side of the bell shaped curve. The brand has cultivated us to be thus.

Let's stay focused on what BMW should be doing to attend to those most responsible for the brand's ongoing success. I'm still trying to figure out how wiping out customer orders, allowing customers to experience inconvenience and outright hassles with lease returns, and bumping well-kitted ordered cars in favor of generics....

Quack needs no defenders, he can stand his own ground, but I'm standing with him on this one, _courteously_, of course.


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## SteveinArizona (Sep 12, 2016)

quackbury said:


> Rant of the Day:
> 
> I've been mentally replaying my dealer visits yesterday, and some different dealer websites I visited. It dawned on me: Every dealer in a 100 mile radius has 5 to 15 brand new, low-price 228 GC's in inventory. Front Wheel Drive BMW's! Designed for and marketed to newcomers to the marque, likely coming from a Corolla, Civic, etc.
> 
> ...


+1000. Great post, great points.

Many folks who buy the 228GCs will think they are buying a four door version of the wonderful 2 series. When they eventually find out that they have bought a Golf (equivalent), they will not be happy not will they return as customers. But in the meantime BMW is abandoning its best customers by stopping German pickups for American customers, delaying delivery of cars such as this, etc.

But...the best answer is that there are many, many car companies and if BMW abandons its best customers, there are many others happy to serve us.


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## Alpine300ZHP (Jan 31, 2007)

Guys. The 2 GC is an xdrive only platform. Not that I don’t agree with Quack’s assessment of the car and it’s market.... Even the Roundel editor who tested the car for this months issue noted the same thing I said when the car came out....the 2 GC is the same price as a base 330i when equipped similarly and the 330i is a far better car. BMWNA was smoking crack when they thought that 2 GC would be a good seller at that price point. Absent big rebates to get the lease payment to 299 a month, the 2 GC is a complete fail. 


Sent from my iPhone using Bimmerfest


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## quackbury (Dec 17, 2005)

Alpine300ZHP said:


> Guys. *The 2 GC is an xdrive only platform*. Not that I don't agree with Quack's assessment of the car and it's market.... Even the Roundel editor who tested the car for this months issue noted the same thing I said when the car came out....the 2 GC is the same price as a base 330i when equipped similarly and the 330i is a far better car. BMWNA was smoking crack when they thought that 2 GC would be a good seller at that price point. Absent big rebates to get the lease payment to 299 a month, the 2 GC is a complete fail.


While you and I agree on most things, and I agree with the rest of your post, the part I bolded is incorrect. While BMWNA is importing only the xDrive variant (for now), the platform is in fact FWD, like the Mini it's based on. From automotive News Europe:

The 2-series Gran Coupe shares its *front-wheel-drive platform* with the 1-series hatchback and 2-series Tourer minivan. BMW's other compact cars, the 2-series coupe and convertible, are underpinned by rear-wheel-drive architecture.​
https://europe.autonews.com/automakers/bmw-expands-2-series-fwd-coupe-styled-sedan


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## 1968BMW2800 (Aug 13, 2016)

I have yet to drive a 2 GC. But then, my daily driver is a Clubman S All4 with a Dinan plugged in for a little more kick, with much the same driveline and chassis, so I am certainly familiar with the underpinnings. Absolutely a hoot and a half to drive... in the MINI configuration.

We all understand the market is shifting in many uncharted ways. And price point is a factor -- not so much MSRP, but drive off and monthly payment remain the biggies in front of most car buyers.

One result of COVID is that dealers of all makes and brands have been scrambling to shift their processes toward low contact/no contact dealings with potential buyers. This, of course, changes the paradigm for the majority of car dealers who used the meet-and-greet, walk around, test drive, come on in, sit down, let's go over my manager's numbers steps to the sale process. 

As a mostly elite group of buyers, we 'Festers fall way outside the norm. It is understandable that BMW, like Mercedes, keeps looking for that new magic niche to snag new customers.

My issue is, will we be forsaken as BMWNA chases conquests? Will only the $80K ~ $120K top line Bimmers be "reserved" for us? Or will the processes needed to sell to the 2 GC conquest buyer infect things up and down the line?

Meanwhile, I'm gloating because I went to my BMW Center to get a new BMW and, to my amazment, got a MINI instead, and then went back for another MINI. So I'm an early adopter and I've snagged the pole position in the race to the bottom. Woo Hoo! 

The advent of the 2 GC , as well as Quack's mistreatment by BMWNA and his dealer, is all my fault. I feel special.


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## quackbury (Dec 17, 2005)

Happy endings Report.

So I will bring my saga full circle. (gkr778 you should stop reading now, as continuing may upset you further.)

Channeling my inner 1968BMW2800, I reached out _politely_ to the owner of the dealership. I've been buying cars from him since 1981, and we're in that fuzzy gray zone of less-than-friends-but-more-than-acquaintances, following each other on social media, having half-hour visits when I stop by for service, etc. The type of relationship where, when I come by for service, he often lets me take whatever he's driving that week as my "service loaner". I've had some fun with "his" M6, Macan Turbo and other neat rides, and he even offered me his Audi R8 on one visit. My complaint was the P1-order-vs-228-GC-deal, and he owned that. With much of his staff furloughed (not just at the BMW store, but also the Porsche, Audi, RR and MacLaren stores he owns) he'd told BMW to suspend deliveries of what they had for him at the port. Like most decisions in life, it was made for the right reasons but had unintended consequences, like five other long-time customers who were in the same boat as I am.

The next day, the GM reached out to me to "make it right":


My deal - which was originally at invoice, then went $500 over invoice, is now $1,500 UNDER invoice.
They have offered to ground my 2017 lease now, and comp me a loaner to drive, gratis, for however long it takes my 2020 to arrive.
They have assured me that they will lock this month's program - with the two payment waivers - for as long as it takes to get me my car. If BMWNA won't cooperate, the dealership will stroke me a check to make me whole.

In short, a Master Class in Customer Relations, making an admittedly-entitled customer feel even more special. Great things happen when you ask, especially when you ask _politely_. As my late father used to say, "It never hurts to ask - the worst that can happen is they say no, but many times you will be pleasantly surprised."


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## 1968BMW2800 (Aug 13, 2016)

Get down with your bad-monkeyazz self!!!


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## 1968BMW2800 (Aug 13, 2016)

"no" is just the start of a conversation.


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## Alpine300ZHP (Jan 31, 2007)

quackbury said:


> While you and I agree on most things, and I agree with the rest of your post, the part I bolded is incorrect. While BMWNA is importing only the xDrive variant (for now), the platform is in fact FWD, like the Mini it's based on. From automotive News Europe:
> 
> The 2-series Gran Coupe shares its *front-wheel-drive platform* with the 1-series hatchback and 2-series Tourer minivan. BMW's other compact cars, the 2-series coupe and convertible, are underpinned by rear-wheel-drive architecture.​
> https://europe.autonews.com/automakers/bmw-expands-2-series-fwd-coupe-styled-sedan


Ok Quack. We are in agreement. I took your use of the word "platform" to mean that the 2 GC was a FWD car rather than what you actually meant which was that the platform is a FWD Mini based platform, which is entirely correct. FWIW, I heard that the FWD version was not going to be imported, but that might be incorrect information.

Sent from my iPhone using Bimmerfest mobile app


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## Alpine300ZHP (Jan 31, 2007)

quackbury said:


> Happy endings Report.
> 
> So I will bring my saga full circle. (gkr778 you should stop reading now, as continuing may upset you further.)
> 
> ...


Excellent outcome and goes to show that a relationship with a dealer can make all of the difference.

Sent from my iPhone using Bimmerfest mobile app


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## Ibiza (Jun 15, 2007)

Great outcome, glad it all worked out for you, as the dealership did the right thing in the end-- just too much stress you had to deal with.


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## ard (Jul 1, 2009)

SteveinArizona;133421z said:


> But...the best answer is that there are many, many car companies and if BMW abandons its best customers, there are many others happy to serve us.


Yeah, well I think BMW figured out- quite some time ago- that there are a ton of customers in the sea, and finding them is pretty easy. English speaking..Chinese speaking...they dont actually care too much

However they DID spend time making noises so customers THINK they are special...


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## Shon528 (Oct 3, 2003)

quackbury said:


> Happy endings Report.
> 
> So I will bring my saga full circle. (gkr778 you should stop reading now, as continuing may upset you further.)
> 
> ...


Now THAT is coming around full circle!


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## Autoputzer (Mar 16, 2014)

The e-mail preview on my phone displays the first half sentence of a post in a thread I'm subscribed to. When I saw "Happy endings report" and "... coming full circle" I deleted those e-mails. 

The monkeyazzduck's experience brings out a good point. Repeat customers are treated better than those who shop dealerships every time they buy or lease a car and rarely do so from the same dealer two times in a row.

My employer sent me to some kind of class once about management, leadership, or whatever. One of the important things I learned there was that *** happens in every business or organization, but the great businesses and organizations use those negative events to actually strengthening their relationships with their customers.

Back in January, BMW of Bubbaville had so many new cars coming in that they were storing truckloads of 3 Series cars at their Chevy lot, and telling the Chevy salesmen to feel free to sell them.


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## alex2364 (May 8, 2006)

For those that chose to do the 6 month lease extension, is BMW FS offering the buyout discount during and at the end of the 6 month extension? I would like to have the option of buying out my car at the end of my extension if I can***8217;t find anything I like.


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## 1968BMW2800 (Aug 13, 2016)

alex2364 said:


> For those that chose to do the 6 month lease extension, is BMW FS offering the buyout discount during and at the end of the 6 month extension? I would like to have the option of buying out my car at the end of my extension if I can't find anything I like.


I would strongly suggest you contact BMWFS and clarify:

1, What will the new residual be at the end of the 6 month extension term?

2, Will the new residual be the maximum buyout price?

3, Will there be a special buyout price as good or better than the discounted buyout offer extended at the original lease end?

Confirm anything and everything you are told with email or other written follow up, and, of course, log names of persons at BMWFS and exact time and date of conversation(s).


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## dll2k4 (Feb 6, 2010)

1968BMW2800 said:


> I would strongly suggest you contact BMWFS and clarify:
> 
> 1, What will the new residual be at the end of the 6 month extension term?
> 
> ...


++

and here is one data point:

I have just started the first month of a lease extension (with payment made at 50% discount). My residual just dropped from 61% to very close to 60% of MSRP, minus the $6000 payoff discount.

I am going to return the vehicle in late June, and am still holding on to some hope for an early August ED.


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## alex2364 (May 8, 2006)

I contacted BMWFS and they can't promise the buyout discount beyond my current statement period. So my residual at end of the 6 month extension would be $1k less than what my buyout price is currently. It doesn't make sense when I'm paying $950/month. :thumbdwn:


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## 1968BMW2800 (Aug 13, 2016)

alex2364 said:


> I contacted BMWFS and they can't promise the buyout discount beyond my current statement period. So my residual at end of the 6 month extension would be $1k less than what my buyout price is currently. It doesn't make sense when I'm paying $950/month. :thumbdwn:


Assuming the residual diminishes monthly by the depreciation portion of your monthly payment, it might then also be impacted by a residual percentage adjustment, so you're treading water.

Get all the numbers in writing from BMWFS. Get them to explain any residual adjustment, and any payoff adjustment, and how they are calculated.

You want the formula.


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## namelessman (Dec 23, 2004)

alex2364 said:


> I contacted BMWFS and they can't promise the buyout discount beyond my current statement period. So my residual at end of the 6 month extension would be $1k less than what my buyout price is currently. It doesn't make sense when I'm paying $950/month. :thumbdwn:


What is buyout discount offered by BMWFS, e.g. $4k to $6k?

And with the buyout discount(if any), how is the final buyout price compared to FMV?

Assuming the goal is to own the car even after 6 months, then the comparison will be the current final buyout price(after buyout discount), versus extra 6 * $950 = $5.7k + buyout price 6 months from now.


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## alex2364 (May 8, 2006)

namelessman said:


> What is buyout discount offered by BMWFS, e.g. $4k to $6k?
> 
> And with the buyout discount(if any), how is the final buyout price compared to FMV?
> 
> Assuming the goal is to own the car even after 6 months, then the comparison will be the current final buyout price(after buyout discount), versus extra 6 * $950 = $5.7k + buyout price 6 months from now.


Current discount is $4500. So my current payoff amount including discount is $45,600.03. According to Edmunds, my trade in value is $40,700.

The problem is I don't know what I want to do. Usually in the past I've always had something new in mind when my lease is up. Right now there's nothing new and exciting that I really want. The current M4 is exactly the same as what I drive now, the new 4 series/M4 grill is butt ugly, I don't know if I'll be happy with M340i. I looked at a leftover 2019 Porsche Cayman/Boxster GTS but dealers aren't discounting them more than 13%. That's not worth it for a year and half old car.

So right now I'm leaning towards extending my lease and see what happens at the end of the year.


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## ams3141 (Apr 25, 2017)

namelessman said:


> What is buyout discount offered by BMWFS, e.g. $4k to $6k?
> 
> And with the buyout discount(if any), how is the final buyout price compared to FMV?
> 
> Assuming the goal is to own the car even after 6 months, then the comparison will be the current final buyout price(after buyout discount), versus extra 6 * $950 = $5.7k + buyout price 6 months from now.


My "Customer Purchase Promotion" from BMWFS is $6k on my '17 330e. 
This is significant, but still puts my lease payoff about $2500 above the private party value and over $7k higher than KBB's trade in value. Imagine if it didn't have the $6k incentive, I would be paying significantly more than any other CPO customer would be. It's a great car though- less than 14,000 miles!

It clearly does not make financial sense to purchase my car, even with the incentive, as I've already paid for it over 3 years, why finance another 4-5 years whilst paying more than its worth?

Of course, I'm not really seeing the value in the lease extension, as BMWFS has not offered me any discount on my current monthly payment. Can't get a dealer to commit to a build, nor can I buy a 330e off the lot as they haven't arrived yet! I have the feeling my next vehicle may very well not be a BMW at this rate.


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## Autoputzer (Mar 16, 2014)

ams3141 said:


> My "Customer Purchase Promotion" from BMWFS is $6k on my '17 330e.
> This is significant, but still puts my lease payoff about $2500 above the private party value and over $7k higher than KBB's trade in value. Imagine if it didn't have the $6k incentive, I would be paying significantly more than any other CPO customer would be. It's a great car though- less than 14,000 miles!
> 
> It clearly does not make financial sense to purchase my car, even with the incentive, as I've already paid for it over 3 years, why finance another 4-5 years whilst paying more than its worth?
> ...


BMW's usually don't start being an aggravation until about 70k miles or so. For you, that'd be somewhere around 15 years. $2500 above private party is about where you'd be finding a used one on a lot, maybe less.

Your lease payment has been significantly less than what buying and financing the car would have been. But, you have no equity in the car. All your payments have been interest and deprecation. If you bought it and finance it over five years, your monthly payments would be lower than your lease payment, and your payment into equity would be less than the monthly depreciation. At some point in the future, you'd actually have significant positive equity in the car if you wanted to punch out early by selling the car.

Leasing is a very expensive way to drive a BMW if you only drive 5k miles/year. You're statement that buying it off-lease "doesn't make financial sense..." argument is really just a "I want a new car" in disguise.

Quackbury is a bazillionaire, owns his own business and most likely writes off HIS BMW under the business. He also drives about 20k miles/year. For him, leasing is a no-brainer. But, even being a bazillionaire, he bought a three year old BMW for his wife, who doesn't write off the car under a business and likely doesn't drive 20k miles/year. The duck realizes that under normal circumstances a three year old BMW is much cheaper to drive than a new one.

My 535i is just over six years old. I track my annual deprecation, maintenance, and capital costs. It's averaged $867/month. That's about where I would have been leasing two of them instead. But, it's the seventh, eighth, and ninth years where I'll end up saving about $25k over what I would have spent leasing three of them.


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## ams3141 (Apr 25, 2017)

Autoputzer said:


> BMW's usually don't start being an aggravation until about 70k miles or so. For you, that'd be somewhere around 15 years. $2500 above private party is about where you'd be finding a used one on a lot, maybe less.
> 
> Your lease payment has been significantly less than what buying and financing the car would have been. But, you have no equity in the car. All your payments have been interest and deprecation. If you bought it and finance it over five years, your monthly payments would be lower than your lease payment, and your payment into equity would be less than the monthly depreciation. At some point in the future, you'd actually have significant positive equity in the car if you wanted to punch out early by selling the car.
> 
> ...


That's a fair point - I suspect that I am not the only one on these forums who gets the new car itch every few years and enjoys driving new cars on a regular basis. Given that, the idea of paying for my current vehicle another 5 years, knowing there is a newer and better product out there isn't terribly appealing.

My first vehicle was a low-mileage 2012 Ford Focus that I purchased used in 2013. I put a hefty sum down on the car in order to keep my monthly payment low (I was in college at the time and was paying for that in addition to the car), and ended up dumping it in 2017 for a BMW after dealing with years of technology gremlins and constant transmission problems. I got hosed in doing that, as I never got the money "back" that I'd put down- sold the car before it was paid off and the depreciation on those cars was terrible, so I barely got more for it when I traded it than it was worth. That experience made me lease the BMW I have now- a brand new car that is always under warranty, affordable (for a BMW) monthly payments and the opportunity to have a new car every 3 years. $0 down as well, so no chance of losing money the same way I did before.

I'll have to do a deeper analysis on it, but you may be right that I could purchase the 330e with the 6k discount and have a lower monthly payment (assuming a 5 yr loan), which would solve the issue I have with the lease extensions which is paying the same payment for a 3 year old car that is less valuable than it was originally.

Then there is the question of the car's worth- hopefully it does not depreciate faster than my payments against the loan, but you never know. I'd be starting out at a disadvantage, since the payoff is higher than the book value. I was upside down for a long time on the Ford (maybe not surprising), and would prefer to avoid those situations if possible.


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## 1968BMW2800 (Aug 13, 2016)

ams3141 said:


> My "Customer Purchase Promotion" from BMWFS is $6k on my '17 330e.
> This is significant, but still puts my lease payoff about $2500 above the private party value and over $7k higher than KBB's trade in value. Imagine if it didn't have the $6k incentive, I would be paying significantly more than any other CPO customer would be. It's a great car though- less than 14,000 miles!
> 
> It clearly does not make financial sense to purchase my car, even with the incentive, as I've already paid for it over 3 years, why finance another 4-5 years whilst paying more than its worth?
> ...


When you first leased this car it was with the assumption that there would be no discount from residual available if you were to choose lease-end buyout. Now, Christmas comes early and BMW throws an extra 6 grand at you.

I would not evaluate the BMWFS offer only in terms of relative current market value, as this is a very dynamic number that may well be a much lower number shortly. There are a lot off BMWs coming off lease that have yet to work their ways through the auction system.

The question becomes: What is the car's value to you over the next 5 - 7 years? How would you feel about driving a very low mileage car without warranty? Where does driving the latest and greatest fit into your lifestyle, taste, and budget?

Some of us New Car Smell addicts long ago gave up on making the numbers work. We want a nice new car every three years and, after grinding out the best possible deal, we pay the opportunity cost for our addiction.

My father's last BMW, the last of many, lived in our extended family for many years after Pops went on to his eternal reward. I think he paid about $27,000 out-the-door for that 1990 5 series, so, in the long run, full value was more than received over a couple of decades.

If you love the car and don't want to part with it, and feel confident it won't give you costly trouble (that "e" makes me a bit nervous as it is still complex technology), buy the car.

If you look in the mirror and realize the New Car Smell curse has you by the neck, go find something new and fun -- lots of excellent choices among many good brands.

Best of luck. Life is short.


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## Autoputzer (Mar 16, 2014)

ams3141 said:


> That's a fair point - I suspect that I am not the only one on these forums who gets the new car itch every few years and enjoys driving new cars on a regular basis. Given that, the idea of paying for my current vehicle another 5 years, knowing there is a newer and better product out there isn't terribly appealing.
> 
> My first vehicle was a low-mileage 2012 Ford Focus that I purchased used in 2013. I put a hefty sum down on the car in order to keep my monthly payment low (I was in college at the time and was paying for that in addition to the car), and ended up dumping it in 2017 for a BMW after dealing with years of technology gremlins and constant transmission problems. I got hosed in doing that, as I never got the money "back" that I'd put down- sold the car before it was paid off and the depreciation on those cars was terrible, so I barely got more for it when I traded it than it was worth. That experience made me lease the BMW I have now- a brand new car that is always under warranty, affordable (for a BMW) monthly payments and the opportunity to have a new car every 3 years. $0 down as well, so no chance of losing money the same way I did before.
> 
> ...


Batteries are the 800 pound gorilla in the room when it comes to maintenance costs for any older hybrid. I don't know the answer for a 330e. I know what it was for a coworker's Accord Hybrid and my sis-in-law's Prius. Those batteries needed replacing after about eight years.

A rule-of-thumb or an average car with average mileage (~12k/year) is that depreciation is: 25% from MSRP the first year, 20% down from book value the years the car goes out of warranty, becomes seven model years old, and goes over 100k miles, and 15% of book value the remaining years. Here's a spreadsheet of those rules-of-thumb applied to a $60k car. Your depreciation rates would be less due to your low annual mileage.

My estimated $25k savings are including spending $2k/10k miles ($0.20/mile) in maintenance costs in the out years.

If you're worried about repair costs, talk to one or more dealers about an extended warranty. But, on average, extended warranties are a bad deal. If they weren't, those selling them would lose money.

I like the new car smell too. But, I've learned it's more fun when it's in a car with "M School" or "Porsche Driving School USA" decals on the doors. When I break one of those cars, they bring me another one. So, that ends up being where the $25k I save by keeping my BMW's to 100k miles goes.


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## JTM09 (Jan 12, 2006)

alex2364 said:


> Current discount is $4500. So my current payoff amount including discount is $45,600.03. According to Edmunds, my trade in value is $40,700.
> 
> The problem is I don't know what I want to do.


Lots of guys in the same situation here ..me included



alex2364 said:


> Usually in the past I've always had something new in mind when my lease is up. Right now there's nothing new and exciting that I really want. The current M4 is exactly the same as what I drive now, the new 4 series/M4 grill is butt ugly,


If the G series M is as ugly as speculated, the F series may hold some value



alex2364 said:


> I don't know if I'll be happy with M340i.


You won't. I had one as a loaner and it was mehhh



alex2364 said:


> I looked at a leftover 2019 Porsche Cayman/Boxster GTS but dealers aren't discounting them more than 13%. That's not worth it for a year and half old car.
> 
> So right now I'm leaning towards extending my lease and see what happens at the end of the year.


 I'm thinking about a '17 911 now ...


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## alex2364 (May 8, 2006)

JTM09 said:


> Lots of guys in the same situation here ..me included
> 
> If the G series M is as ugly as speculated, the F series may hold some value
> 
> ...


I decided to lease another M4 and agreed to a deal with the GSM of dealer. I'm scheduled to sign it this weekend.

$85,135 MSRP
$74,919 sale price (12% discount before incentives)
36 months
10k miles
.00118 MF
$3250 incentives
$500 BMW CCA rebate
$200 Doc fee
$300 DMV fee

$702/month if I pay tax and fees up front, or $854/month with $0 due at signing.


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## Autoputzer (Mar 16, 2014)

alex2364 said:


> I decided to lease another M4 and agreed to a deal with the GSM of dealer. I'm scheduled to sign it this weekend.
> 
> $85,135 MSRP
> $74,919 sale price (12% discount before incentives)
> ...


&#8230; can't beat that. Congratulations!

That's about where I was (depreciation, maintenance, and capital costs) with a $73k MSRP 535i after six years and 66k miles. The Floriduh 6% sales tax and a jack and aftermarket spare tire took my out the door cost almost back to MSRP.


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## quackbury (Dec 17, 2005)

Solid deal, particularly with the 2- or 3-month payment waiver. Well done!

I bust his chops a lot, but the KoS (King of Spreadsheets) does have some good ideas from time to time (sort of the blind squirrel analogy). Like his endorsement of the BMW credit card. The card gives you FIVE TIMES points when used at a BMW dealer, so I am planning on using mine for my drive-off costs. If I do 4 MSD's, the drive-away costs on my 2020 will be +/- $5,500, generating 27,500 in points, worth $250 towards a lease payment, or $312.50 for a Rewards Card redeemable at the dealer's parts department. I have my BMW Card set up on AutoPay, so it's "free money" and using it for the inception costs will pay for my floor liners, trunk mat and other doo-dads.


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## Autoputzer (Mar 16, 2014)

quackbury said:


> Solid deal, particularly with the 2- or 3-month payment waiver. Well done!
> 
> I bust his chops a lot, but the KoS (King of Spreadsheets) does have some good ideas from time to time (sort of the blind squirrel analogy). Like his endorsement of the BMW credit card. The card gives you FIVE TIMES points when used at a BMW dealer, so I am planning on using mine for my drive-off costs. If I do 4 MSD's, the drive-away costs on my 2020 will be +/- $5,500, generating 27,500 in points, worth $250 towards a lease payment, or $312.50 for a Rewards Card redeemable at the dealer's parts department. I have my BMW Card set up on AutoPay, so it's "free money" and using it for the inception costs will pay for my floor liners, trunk mat and other doo-dads.


That monkeyazzduck&#8230; he so funny.

I prefer "Emir of Excel."

BMW FS's changed their credit card from Visa to MasterCard this year, and farmed it out to Elan Financial.

The old BMW FS Visa advertised 3% or 4% rebates at BMW dealerships. But, down in the fine print was a little blurb that it was at ANY car dealership. The Visa database apparently couldn't keep track of the brand of the dealerships. I was planning to replace my twelve year old Cobalt with another GM POS (collecting $4k in rebates on my GM MasterCard), and then putting the rest of the cost on my BMW FS Visa.

Another scam with the BMW FS Visa was that you collected your rebates as a credit on your Visa statement after you bought a BMW. I put about $5.5k of the cost of Frau Putzer's X3 on the BMW FS Visa, and then got 4% of that back ($210).


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## Ibiza (Jun 15, 2007)

The take away from Autoputzer aka KoS is the 55% residual inflection point after year 3. If the residual offered by BMWFS is higher than 55% then lease, but a model such as a M2 should be purchased/financed due to the residual lower than 55%.


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## 1968BMW2800 (Aug 13, 2016)

alex2364 said:


> I decided to lease another M4 and agreed to a deal with the GSM of dealer. I'm scheduled to sign it this weekend.
> 
> $85,135 MSRP
> $74,919 sale price (12% discount before incentives)
> ...


Nicely done. Enjoy!!

I'm thinking about starting a New Car Smell Addicts support group.


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## Autoputzer (Mar 16, 2014)

1968BMW2800 said:


> Nicely done. Enjoy!!
> 
> I'm thinking about starting a New Car Smell Addicts support group.


Just remember those fumes are chemically similar to estrogen... so... well you know...

New car smell = man boobs 

When things are normal (not during a pandemic), I don't fight tooth and nail over price. With loyalty and USAA I get where I need to be on price even with splitting the difference between MSRP and "invoice." Plus, BMW of Bubbaville's done me more than a few solids over the last 19 years.

But, the OP's results are making me think about seeing if there's something interesting in BMW of Bubbaville's inventory... and still in the wrappers.


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## 1968BMW2800 (Aug 13, 2016)

Autoputzer said:


> Just remember those fumes are chemically similar to estrogen... so... well you know...
> 
> New car smell = man boobs
> 
> ...


Exactly. That's why it will be a "support" group. Bras may be required. 

It is interesting that several posters on various threads have complained that dealers won't play ball.... and yet, veterans of the deal game are demonstrating that the more things appear to change the more they remain the same. Dealers need to sell cars; 'Festers need to get good deals. The balance of the universe continues.

Congratulations to those who have done good deals on vehicles they will enjoy.


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## ams3141 (Apr 25, 2017)

alex2364 said:


> For those that chose to do the 6 month lease extension, is BMW FS offering the buyout discount during and at the end of the 6 month extension? I would like to have the option of buying out my car at the end of my extension if I can't find anything I like.


I just heard back from BMWFS - the account rep. told me that the discount is not guaranteed to last the length of any extension - in my case it is currently valid through early July (about a few days prior to my lease contract termination date).

I inquired about the residual after the six month potential extension - unchanged from the current residual. It sounds like they'd prefer if I either purchase the car now (with discount) or do the extension then lease/buy something new. I don't think their goal is to have someone do a six month extension on the lease, then try to purchase the car at a discount.

I also asked about the 50% discount on a lease extension for 1 month that some other 'festers had mentioned - they told me this was only applicable to those with May lease expiration dates as they had nowhere to return their cars to in many cases.


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## 1968BMW2800 (Aug 13, 2016)

ams3141 said:


> I just heard back from BMWFS - the account rep. told me that the discount is not guaranteed to last the length of any extension - in my case it is currently valid through early July (about a few days prior to my lease contract termination date).
> 
> I inquired about the residual after the six month potential extension - unchanged from the current residual. It sounds like they'd prefer if I either purchase the car now (with discount) or do the extension then lease/buy something new. I don't think their goal is to have someone do a six month extension on the lease, then try to purchase the car at a discount.
> 
> I also asked about the 50% discount on a lease extension for 1 month that some other 'festers had mentioned - they told me this was only applicable to those with May lease expiration dates as they had nowhere to return their cars to in many cases.


Thanks for letting us all know.

Sounds like six month lease extensions are simply a convenience without specific financial benefit beyond avoidance of committing to a new lease or purchase now.

There is always the possibility of purchase discounts at the end of a lease-end extension, but BMWFS is saying, "don't count on it."

So if one believes purchase will be exercised, BMWFS is, _at this time_, saying, "buy it now." Which I would be disinclined to do.

Which brings us all back full circle to what Quack was exploring in this thread from his first post.

My most significant takeaway from this very informative discussion is: The future is uncertain; all important decisions in life are made on the basis of insufficient data. You pays your money and you takes your chances.

Drive what you love.


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## ctorrey (Mar 17, 2007)

One quick note about the 6 month extensions; you can opt out at any time during the 6 months. Of course one of the downsides is that after 36 months, complimentary maintenance expires. Warranty still in effect though.


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## Autoputzer (Mar 16, 2014)

ctorrey said:


> One quick note about the 6 month extensions; you can opt out at any time during the 6 months. Of course one of the downsides is that after 36 months, complimentary maintenance expires. Warranty still in effect though.


The 36 month brake fluid change starts counting when the car is made, not when it's bought. So, get that done during the initial lease period. Oil changes are 10k miles/12 months. So, you should get getting one those for free right near the end of the original 36-month lease period.

You have to worry a little more about the 4/32" tread depth requirement at lease turn-in. It's a trick to go 36k miles or even 30k miles on the OE tires and still have 4/32" of tread left. If you have a square set-up, you can improve your chances by rotating the tires and keeping some extra pressure in them.

I don't lease, but I should make it to 45k to 50k miles and still have 4/32" of tread. But, I'm special.


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## ams3141 (Apr 25, 2017)

Autoputzer said:


> BMW's usually don't start being an aggravation until about 70k miles or so. For you, that'd be somewhere around 15 years. $2500 above private party is about where you'd be finding a used one on a lot, maybe less.
> 
> Your lease payment has been significantly less than what buying and financing the car would have been. But, you have no equity in the car. All your payments have been interest and deprecation. If you bought it and finance it over five years, your monthly payments would be lower than your lease payment, and your payment into equity would be less than the monthly depreciation. At some point in the future, you'd actually have significant positive equity in the car if you wanted to punch out early by selling the car.
> 
> ...





Autoputzer said:


> If you're only driving 5k miles/year, owning is a lot more attractive than leasing. Nothing much goes wrong with BMW's until around 60k or 70k miles. Somewhere around 20k miles/year, it's a no-brainer to lease a BMW. At ~12k miles/year, the break-even point between buying and leasing is somewhere around six years. Six years is about the average turn-over for new cars sold in the U.S. My 535i is six years old and had 65k miles on the last anniversary of its purchase. Considering deprecation, maintenance, and capital costs, I was just about where I would have been if I'd leased two of them. *It's the 7th, 8th, and 9th years where my savings will be huge, on the order of $25k, over leasing a new one.*
> 
> Buying a hybrid when you drive 5k miles/year didn't make financial sense. But, even if you have to replace the batteries in the 9th year, you'd still be money ahead. If they go out during the warranty period. you won a $5k scratch-off ticket.
> 
> ...


Apologies for bumping an old thread yet again, but wanted to come back to the depreciation topic. Now, I work in FP&A (think budgeting) not accounting specifically so that might explain some of my ignorance on this topic... but as mentioned in previous posts last July I took up BMWFS on their offer to purchase at lease-end on my 2017 330e. With them offering $6k off the residual and the difficulties at the time with getting a G20 330e (covid/supply), plus me not finding a deal I liked with some other brands it seemed like a great decision. I figured after some time I would start building a bit of equity rather than just being a serial leaser especially with the ultra-low miles I drive thanks to living close to places I need to go and WFH. 

In addition to BMW throwing me a cookie with the $6k, I put a fairly decent chunk of cash down since I had it and it lowered the payment a bit/saved a bit of interest over the course of the loan. Even with that, the depreciation appears to be outpacing the loan payments quite a bit, as I've been underwater the whole time thus far. I realize I'm not even a year in yet but I experienced a similar tanking value with my first car (2012 Ford Fuc-, ahem Focus) and when I finally dumped it for the 330e I never really did recoup my initial down payment on that and only barely had positive equity in it after 4 years or so (also a 5 yr loan). 

Is there something I'm missing with depriciation on BMWs? I check it once a month or so on Edmunds, KBB and even when punching in the seriously low mileage (not quite at 16k on a car delivered Jul 2017) and excellent condition it seems to keep dropping and the payments aren't catching up fast enough. Am I doomed on this too or just need to wait it out a couple years to start seeing the positive equity?


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## CTSoxFan (Oct 20, 2006)

ams3141 said:


> Apologies for bumping an old thread yet again, but wanted to come back to the depreciation topic. Now, I work in FP&A (think budgeting) not accounting specifically so that might explain some of my ignorance on this topic... but as mentioned in previous posts last July I took up BMWFS on their offer to purchase at lease-end on my 2017 330e. With them offering $6k off the residual and the difficulties at the time with getting a G20 330e (covid/supply), plus me not finding a deal I liked with some other brands it seemed like a great decision. I figured after some time I would start building a bit of equity rather than just being a serial leaser especially with the ultra-low miles I drive thanks to living close to places I need to go and WFH.
> 
> In addition to BMW throwing me a cookie with the $6k, I put a fairly decent chunk of cash down since I had it and it lowered the payment a bit/saved a bit of interest over the course of the loan. Even with that, the depreciation appears to be outpacing the loan payments quite a bit, as I've been underwater the whole time thus far. I realize I'm not even a year in yet but I experienced a similar tanking value with my first car (2012 Ford Fuc-, ahem Focus) and when I finally dumped it for the 330e I never really did recoup my initial down payment on that and only barely had positive equity in it after 4 years or so (also a 5 yr loan).
> 
> Is there something I'm missing with depriciation on BMWs? I check it once a month or so on Edmunds, KBB and even when punching in the seriously low mileage (not quite at 16k on a car delivered Jul 2017) and excellent condition it seems to keep dropping and the payments aren't catching up fast enough. Am I doomed on this too or just need to wait it out a couple years to start seeing the positive equity?


This is hard to answer without knowing where you stood on the car on the day of inception. Granted they gave you the $6k cookie, and you put something down, but how far under water was the residual vs. market. There have been extreme cases that I have seen where the spread between residual and market were north of $10K. But for arguments sake, lets say with the extra cash you were at or slightly above market at that point. As I am sure you're aware, with any simple interest contract, your early payments are heavily skewed towards paying interest, not principal. In fact, in most 5 year auto loans you aren't above water until after 3 years of payments (not counting cases where there were large down payments). So for you to be underwater in year one is not so surprising. I would look at the projected depreciation curve of a new 330e (or the equivalent) to get an idea of how much the car depreciates each year...might give some insight into when you may be above water. Of course this is all academic as the only thing that will determine the value of the car is the market dynamics...


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## 1968BMW2800 (Aug 13, 2016)

ams3141 said:


> Apologies for bumping an old thread yet again, but wanted to come back to the depreciation topic. Now, I work in FP&A (think budgeting) not accounting specifically so that might explain some of my ignorance on this topic... but as mentioned in previous posts last July I took up BMWFS on their offer to purchase at lease-end on my 2017 330e. With them offering $6k off the residual and the difficulties at the time with getting a G20 330e (covid/supply), plus me not finding a deal I liked with some other brands it seemed like a great decision. I figured after some time I would start building a bit of equity rather than just being a serial leaser especially with the ultra-low miles I drive thanks to living close to places I need to go and WFH.
> 
> In addition to BMW throwing me a cookie with the $6k, I put a fairly decent chunk of cash down since I had it and it lowered the payment a bit/saved a bit of interest over the course of the loan. Even with that, the depreciation appears to be outpacing the loan payments quite a bit, as I've been underwater the whole time thus far. I realize I'm not even a year in yet but I experienced a similar tanking value with my first car (2012 Ford Fuc-, ahem Focus) and when I finally dumped it for the 330e I never really did recoup my initial down payment on that and only barely had positive equity in it after 4 years or so (also a 5 yr loan).
> 
> Is there something I'm missing with depriciation on BMWs? I check it once a month or so on Edmunds, KBB and even when punching in the seriously low mileage (not quite at 16k on a car delivered Jul 2017) and excellent condition it seems to keep dropping and the payments aren't catching up fast enough. Am I doomed on this too or just need to wait it out a couple years to start seeing the positive equity?


So, here's the deal. We drive these cars because we can and want to. Value is in the ride. Sometimes, when the stars align just right (especially if one drives a little and keeps a good car for a long time with minimal repair costs), depreciation is somewhat mitigated.

But, as in any addiction, we pay for the pleasure. Your experience confirms this.

I once landed an insane lease deal on a Jag. Despite a $20,000 discount from MSRP on the front end, and additional $1,500 cash back from Jaguar USA, and great lease terms, at the end of a two year lease the car, in near showroom condition, was worth less than the residual and the dealer who grounded the car at lease end sent it to the auction.


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## namelessman (Dec 23, 2004)

ams3141 said:


> Is there something I'm missing with depriciation on BMWs? I check it once a month or so on Edmunds, KBB and even when punching in the seriously low mileage (not quite at 16k on a car delivered Jul 2017) and excellent condition it seems to keep dropping and the payments aren't catching up fast enough. Am I doomed on this too or just need to wait it out a couple years to start seeing the positive equity?


Someone at work bought a brand new Model S at Tesla's liquidation sale at end of Jan. 

There weren't many units available, and his car is $60k for a AWD with 400+ miles of range, with 0-60 at 3+ seconds. The same car went for $120k 3 years ago.

So the same car's MSRP went down 50% in 3 years, so just imagine the resale for those sold 3 years ago with 30k-50k miles on it, say, $40k? If correct then will be a huge drop from $120k.

As far as payments can't catch up to FMW drops, one way to think of this is to treat these cars as utility, e.g. a hammer, a fork, with $0 value at end of useful life. 

So don't worry about positive/negative equity, pay what is owed and get the utility out of the tool, and be happy.


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## ard (Jul 1, 2009)

ams3141 said:


> positive equity?


In a car?! Positive equity????

Never. Buy it, drive it, toss it.

Its not a house...you pay for the luxury of having fancy transportation.


If you look at a car, every 2-3 years divide the value by two. But it new, in 3 years it is worth 50%...refi that at "50% of MSRP" and in 3 more years its now worth 25%.... This means you will never, ever come out ahead on 'equity' (edit: except maybe on the last 6 months of a payment schedule, maybe 3 months)


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