# 335D Lease or Finanace Q



## BluTundra (May 11, 2011)

Hi everyone. I have a 335D lease or finance question for you all. 

I'm off to pick up my ordered car from the BMW dealership a whole 2 weeks after it was delivered (damned extended "vacation"!). I had the dealership prepare a lease offer for me on my car and I wanted to know your opinion on which direction I might go. Both are viable options for me... otherwise I wouldn't be tearing my hair out over the prospect! First the facts:

Total suggested Price: $55,900
Price after haggling: $49,600

If I were to finance, I would be putting down about $30,000 on the car to get the payments where I want them to be, ~$400.

As for the lease deal, the dealer has quoted me a 3 year, 15000 mile contract at $797.49 per month. That includes tax and fees. The total drive off for that would be $1556.59. 

Now, I know the lease and buy debate runs endlessly, and a lot of it greatly depends whether the buyer/lessee wants to change cars every 3-4 years. Well, I am the kind of guy that likes the new shiny. I'm also young and somewhat impatient. That being said, I prefer not to be a fool and hate being taken for a ride. So, before I ink any deal, I want to know what you all think of that lease number. Is the dealer trying to pull numbers that are out of the ordinary? Is this pretty much well within the norm? 

Or... am I a fool for even considering a lease? Your informed opinion matters to this poor, white knuckled buyer. And yes, I am absolutely... insanely excited to get this car!


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## Pasa-d (May 7, 2011)

If you're willing to put $30K down, do the single pay lease instead. It'd be about the same amount of cash then you'd have NO monthly payments! Plus, you save a whole lot of sales tax.


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## BluTundra (May 11, 2011)

Pasa-d said:


> If you're willing to put $30K down, do the single pay lease instead. It'd be about the same amount of cash then you'd have NO monthly payments! Plus, you save a whole lot of sales tax.


I'm sorry, single pay lease? I haven't heard of this before. What is this exactly? My CA didn't tell me anything about this.


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## Pasa-d (May 7, 2011)

Essentially your making all 36 lease payments up front (think 36x$797) but you get a small interest rate discount for doing so. It would probably end up something like 36x$780 or $28,080. It's kinda like buying the use of the car for 3 years, then you do what you want after that.

If you buy outright, you pay sales tax on the entire value, which in CA is not inconsequential, and you never get that money back. If you lease, single pay or multi pay, you only pay taxes on the amount of car you "use up", basically the difference between the MSRP and the residual. For you, this savings would be about $2200 (0.0975 x (49,600 - (55,900-29,068)). Plus you might get the little interest rate savings depending on what else you could do with the money.


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## BluTundra (May 11, 2011)

Pasa-d said:


> Essentially your making all 36 lease payments up front (think 36x$797) but you get a small interest rate discount for doing so. It would probably end up something like 36x$780 or $28,080. It's kinda like buying the use of the car for 3 years, then you do what you want after that.
> 
> If you buy outright, you pay sales tax on the entire value, which in CA is not inconsequential, and you never get that money back. If you lease, single pay or multi pay, you only pay taxes on the amount of car you "use up", basically the difference between the MSRP and the residual. For you, this savings would be about $2200 (0.0975 x (49,600 - (55,900-29,068)). Plus you might get the little interest rate savings depending on what else you could do with the money.


That is very, very interesting and not something I had heard of before. That pretty much tips the scales in to the lease field almost definitely for me. If that's something I can do, and I will ask about that tomorrow, it's probably what I will end up doing. They get the money up front and lose the risk, and I get a discount. Not bad.

Thanks for the pointer.


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## kestrel (Jul 5, 2009)

If you pay the entire lease upfront (ie have no monthly payments) my understanding is that if you total the car, that money is gone forever. 

Am I missing something?

If you want to lease, I think most people put nothing as cap cost reduction and do seven msds, which you get back at the end.


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## bayarea2007 (May 20, 2010)

the sales tax is federal tax deductible, not sure if it applies to leasing.


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## psycho1313 (Jun 22, 2011)

kestrel said:


> If you pay the entire lease upfront (ie have no monthly payments) my understanding is that if you total the car, that money is gone forever.
> 
> Am I missing something?
> 
> If you want to lease, I think most people put nothing as cap cost reduction and do seven msds, which you get back at the end.


You are correct under regular leases which 99% of people use. Never put money down if you can.

When the full lease term is prepaid as has been mentioned, it is a different contract which as far as I know has much better conditions and is more favorable. Most people just cant afford to prepay the lease in full.

So the money wont be gone forever. They will prorate the unused payments. Remember, he isn't putting money DOWN, he is PREPAYING the future payments.


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## safelight902 (May 4, 2011)

If you have a money to put down, this sounds really cool.
Thanks for the info.


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## wkahn1961 (Apr 13, 2010)

I see on the BMWUSA web site:


$439*/month for 27 months $3,500 ECO Credit available

they allow 10000 miles per year.

Monthly Lease payments of $439.00 for 27 months based on MSRP of $47,675.00. Vehicle may need to be ordered. Total Lease payments are $11,853.00. Excludes tax, title, license and registration fees. Program available to qualified customers and not everyone will qualify. Subject to credit approval. See participating dealer for details. Dealer contribution may affect terms. Lessee must cover insurance and all items not covered under the BMW Maintenance Program. At lease end, lessee will be liable for disposition fee ($350.00), any excess wear and use as set forth in the lease agreement and excess mileage charges of $0.20 per mile for miles driven in excess of 22,500 miles. Purchase option at lease end for $32,419.00 excludes taxes. Lessee acquires no ownership interest unless purchase option is exercised.


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## cssnms (Jan 24, 2011)

Pasa-d said:


> If you buy outright, you pay sales tax on the entire value, which in CA is not inconsequential, and you never get that money back. If you lease, single pay or multi pay, you only pay taxes on the amount of car you "use up", basically the difference between the MSRP and the residual. For you, this savings would be about $2200 (0.0975 x (49,600 - (55,900-29,068)). Plus you might get the little interest rate savings depending on what else you could do with the money.


We in MD get royally screwed since when you lease, you pay sales tax on the entire purchase price.


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## Capt_Amazing (Apr 29, 2011)

BluTundra said:


> Hi everyone. I have a 335D lease or finance question for you all.
> 
> I'm off to pick up my ordered car from the BMW dealership a whole 2 weeks after it was delivered (damned extended "vacation"!). I had the dealership prepare a lease offer for me on my car and I wanted to know your opinion on which direction I might go. Both are viable options for me... otherwise I wouldn't be tearing my hair out over the prospect! First the facts:
> 
> ...


I'm not sure if I did a great job haggling or it's b/c I special ordered my "d" so perhaps sunk costs are different for the dealer....but my #'s were no where near what your CA is quoting you...not even in the same ballpark. total cost was a couple hundred past $45k on a near fully loaded 335d M-sport w/o Nav. (Prem pack, Cold weather, M-Sport pack, ipod/usb, Harmon Kardon stereo upgrade, paddles on steering wheel, etc. )

If it's not too late...maybe you should look at special ordering your "d" to save some money.


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## kestrel (Jul 5, 2009)

Thanks for the clarification...didn't realize there was a separate contract for a prepay lease!


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## 67BMW/2 (Apr 15, 2011)

BluTundra said:


> Hi everyone. I have a 335D lease or finance question for you all.
> 
> I'm off to pick up my ordered car from the BMW dealership a whole 2 weeks after it was delivered (damned extended "vacation"!). I had the dealership prepare a lease offer for me on my car and I wanted to know your opinion on which direction I might go. Both are viable options for me... otherwise I wouldn't be tearing my hair out over the prospect! First the facts:
> 
> ...


Hello,

Just to chime in and comment. I recently leased a 335d with and MSRP of $55,500. The purchase price was negotiated to $48,500. The residuals and interest rates (money factor) change monthly and are published at ridewithg.com. Bottom line, your quoted lease payment is really high. Can you share what the residual and money factor is? The dealer should provide this to you. As I looked, Ryan Amico quoted me a very aggressive price right out of the gate. He is close to you so call him and get a quote to get the best deal. I am not associated with Ryan in anyway, I just appreciate a straight up sales guy. 
*
Ryans contact information is below:* Good luck:

We are Performance Center|Euro Delivery|BMW Individual Specialist
Need a quote??..Ryan Amico Email | T.805.482.8878 ask for Ryan Amico
www.stevethomasbmw.com | Facebook-STBMW | Facebook-Ryan | Twitter-STBMW


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## cssnms (Jan 24, 2011)

First and foremost the montly payment before your down payment sounds VERY high esp based off of an MSRP of $49k. Secondly the downpayment is extraordinary on a leased vehicle. Why not do a 27mo lease under the current BMW promotion with $2500 down at $439 mo? This is based on an MSRP of $47k, which granted is $2k less than your deal and based on 10k mi yr. Now if you negotiated the dealer to $49k because of additional options you added, you need to factor that into your payment which means you will need to put down approx another $2k to get your payment to $400 per month. Mileage can be negotiated and often times the dealer will give you the extra miles at no cost. Sounds a lot better than $30k down doesn't it?! Even if you didn't get the extra 5k mi per yr and had to pay for the extra miles on the back end of the lease you will still save yourself a bundle.

BMW Lease Promotion

http://www.bmwusa.com/standard/cont...O2l7t99Isd3G1l0Ka5YuwFKuQj5XOBR7svyiuTWubot3B


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## AutoUnion (Apr 11, 2005)

Lease and don't put anything down. Keep the $30k in the bank.


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## 67BMW/2 (Apr 15, 2011)

Yep, put zero down. The reason is in the remote chance your BMW gets totaled, you are out whatever you put down. If you do a prepaid lease (which I have never heard of) be really careful about due to this exact scenerio. 

If you want to get fancy and buy down the interest rate with a refundable security deposit (MSD's) its a good way to go. You can buy down the MF with up to 7 refundable security deposits. Each deposit reduces the MF by .00007. I happen to put down 7 refundable security deposits and reduced my MF by .00049 or 1.176% (multiply your MF by 2400 to get the interest rate). The MSD's are calculated by what your monthly payment is. I put zero down and my payment is $670/month. My security deposits were $700 each. I get the MSD's back after the end of lease. Its better than a down payment on a lease for a number of reasons.

Hope that helps...let us know how it goes!


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## TXPearl (Apr 16, 2010)

BluTundra,

Using your sales price + $725 lease acquisition fee (ignoring all sales taxes/fees), your lease payment would be $683.46. This assumes a base money factor of .0019. The dealer can mark up the money factor by .0004, or to .0023 (that would increase the payment to $716.11).

If you did the One Pay (I think that's what they call the single pay lease), you get a break on the money factor of .0008 and the total up front lease payment would be $618.15 x 36 = $22,253.51.

Which is a better deal? In this case, the One Pay. If you put that same amount ($22,253.51) as a down payment on a regular lease, you'd still owe a monthly payment of $23.02. Do the One Pay, you'll have no monthly payment, and you'll avoid putting your down payment at risk in the event of a total loss (note: this risk is often overstated, but it's worth something).

Perhaps an even better deal would be to opt for a 27 month lease. The numbers are...

Regular lease $0 down: $682.80/mo.
One Pay: 27 x 613.47 = $16,563.80

All assume 15K miles/yr.


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## BluTundra (May 11, 2011)

Thanks for all the help, guys. You're all a great resource. Unfortunately, I got swamped today and really didn't have a chance to respond to any of this. But suffice to say, your responses have definitely convinced me of the usefulness of this forum.

Now I know where to come for anything and everything 335d!


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## Pasa-d (May 7, 2011)

I just picked up my car tonight. I was intending to do the prepaid lease, but was told there is no money factor discount for that at the present time so it made no sense any more. Ended up doing the 27 month with max multiple security deposits.


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## edwin191 (Apr 27, 2011)

One thing to keep in mind is the first post BluTundra mentioned the $797/mo price includes all taxes / fees. The taxes need to be accounted for in TX Pearl's calculations.


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## cowbell (Jun 24, 2011)

I just picked up a 335d last week. Leased.
Sport Pkg, Premium Pkg and a few other options
Sticker was 53 and change. Negotiated price was 48.3k
36 month, 12k miles/year

I traded my 2006 Audi A3. They offered 11.5k for the trade. I rolled 9.5k into the lease with 2k check cut to me. This brought my monthly down to 526/month.

This car is awesome!


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## b-gal (Aug 20, 2011)

I am picking mine up tomorrow
2011 335d with M sport package, premium package, HK sound, Satellite Radio, Comfort Access, Ipod/USB, heated seats, Navigation, floor mats and after market window tint. $5k down and $670/month all taxes, fees included. Unfortunately my state adds the tax on total sales price of the MSRP to the lease. We're not a lease friendly state - but I like new cars every 3 years. Purchase really isn't for me and I don't want to deal with selling the car after 3 years. To me, cars are not investments - they are commodities.

I always suffer from buyer's remorse but figured that it's not 2003 any more when I last leased a 5 series Bimmer for $525/month and $5k down. I guess those days are long gone.


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## jagu (Nov 7, 2006)

cowbell said:


> I just picked up a 335d last week. Leased.
> Sport Pkg, Premium Pkg and a few other options
> Sticker was 53 and change. Negotiated price was 48.3k
> 36 month, 12k miles/year
> ...


Wow, so you effectively put $9500 down and your payment was still $500+ ?
They made out very well. :eeps:


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## BMW Power (Jul 25, 2007)

cowbell said:


> I just picked up a 335d last week. Leased.
> Sport Pkg, Premium Pkg and a few other options
> Sticker was 53 and change. Negotiated price was 48.3k
> 36 month, 12k miles/year
> ...


Congrats, the only problem with large money down on a lease is the risk of losing it if the car is stolen or totaled early in the lease, but you probably knew that.


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