# Buy vs Lease!



## dream_machine (Oct 7, 2004)

A general survey....How many of you guys buy your bimmer...and how many lease?


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## dallasfan824 (Nov 21, 2004)

Purchased mein.


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## Gabe (Sep 20, 2004)

This would be a great time to make use of the poll feature of vBulletin :thumbup:


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## BahnBaum (Feb 25, 2004)

My e46 is on loan from my bank.

The manner in which I paid for my e30 is still unclear. http://www.bimmerfest.com/forums/showthread.php?t=74151

Alex


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## jw (Dec 21, 2001)

This topic has been covered multiple times. Even a couple polls.

http://www.bimmerfest.com/forums/search.php?searchid=959742

EDIT: Grr... can't paste search result URLs.

http://www.google.com/search?hl=en&lr=&q=lease+vs.+buy+site:bimmerfest.com&btnG=Search


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## dallasfan824 (Nov 21, 2004)

BahnBaum said:


> My e46 is on loan from my bank.
> 
> The manner in which I paid for my e30 is still unclear. http://www.bimmerfest.com/forums/showthread.php?t=74151
> 
> Alex


So, ahem, did your friend ever have a problem? What the money collected? :dunno:


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## car_for_mom (Jul 15, 2002)

Karl Bimmer (2003 325i, 5-speed, TopasBlau, H/K Stereo, Premium Package) was ordered on 30 August 2002, and picked up 9 December 2002. There were 14 miles on the odometer

As of 22 December 2004, the odometer reads 61,537 miles (98,459.2 kilometers, Herr Moderator  ). In little more than two years, I have driven 61,523 miles, 98,437 kilometers. :eeps: 

Ain't no way I could lease...


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## BahnBaum (Feb 25, 2004)

dallasfan824 said:


> So, ahem, did your friend ever have a problem? What the money collected? :dunno:


Nope, my friend still checks his online checking account daily, and the money is still sitting there. My friend has been awfully tempted during this holiday season to remove the entry from his Quicken account, but my friend has not succumbed. The next event is my friend's trip in January to the North American International Auto Show in Detroit, for which he would love to take a new DSLR. We'll see if my friend can continue to hold out.

Alex


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## bbkat (Oct 27, 2002)

back on topic :neener: 

I leased so in a couple more years I can decide if the E90 will work for me


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## Alamo (Sep 17, 2004)

dream_machine said:


> A general survey....How many of you guys buy your bimmer...and how many lease?


Buy, pre-owned Certified. Let someone else take the hit and you still get the warranty


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## jw (Dec 21, 2001)

3 year lease. Dumped it at 33 months.


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## STEVE46 (Aug 25, 2004)

Alamo said:


> Buy, pre-owned Certified. Let someone else take the hit and you still get the warranty


Werd. The only difference between my 2001 330i and a new one is about $18,000.


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## jw (Dec 21, 2001)

STEVE46 said:


> Werd. The only difference between my 2001 330i and a new one is about $18,000.


Umm.. not exactly.


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## Rowag (Nov 12, 2004)

3 year lease here... leaving at 34 months.

The only time it makes sense to buy is if you're:

(a) looking to make it un-returnable if it was to be leased (mods, etc.)

(b) going to drive the car past the "upside down" point on the loan - i.e. you wlil actually be driving it "for free", or at least wouldn't owe any money if you sold it/traded it in.

(c) you're going to drive so many miles over 15k/year that the extra mileage costs on the lease throw you into purchase rate territory.


I'm currently a fan of leasing because:

- I love getting a new car every three years

- Spending 4-5 years buying a BMW is not currently the most cost-effective way for me to invest my cash (again, I don't need gobs and gobs of miles, and I don't want to do lots of mods)

- the current 1.9% lease rates and residuals on 3-series ROCK

- Ultra warranty, AND ultra maintenance. 3 years worth of maintenance (and wipers, rotors, pads, etc., etc.) can easily add up to a couple thousand bucks -- buy an older used car and you get to foot the bill yourself.


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## wmndriver (Jun 3, 2003)

Bought mine.


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## BrianS (Jul 26, 2004)

Purchased


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## Alamo (Sep 17, 2004)

STEVE46 said:


> Werd. The only difference between my 2001 330i and a new one is about $18,000.


Yep, that's what I have a 2001 330i with Prem & Sports pkgs. I paid $26,900 in june


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## dallasfan824 (Nov 21, 2004)

Alamo said:


> Yep, that's what I have a 2001 330i with Prem & Sports pkgs. I paid $26,900 in june


I am with you. I have a 2001 325 Ci, premium, sports, auto and paid $24,000 in June.


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## Alamo (Sep 17, 2004)

dallasfan824 said:


> I am with you. I have a 2001 325 Ci, premium, sports, auto and paid $24,000 in June.


The newer 3 series have their side turn signals a bit higher and shaped different. BIG DEAL. 
I never buy new. I let some fool take the hit.


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## jw (Dec 21, 2001)

Alamo said:


> The newer 3 series have their side turn signals a bit higher and shaped different. BIG DEAL.
> I never buy new. I let some fool take the hit.


You are definitely very uninformed about the differences between an '01 E46 and a '04/05 E46. Not only from a feature/function point of view, but also from a warranty perspective as well.


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## Rowag (Nov 12, 2004)

johnnygraphic said:


> So, to follow Rowags logic thru after a few leases...I put down $1000 and pay $550/mos on a $42k car with 15k miles per year. (Who really wants to put a measly 12k mileage limit on driving the ultimate driving machine?). Figures are from BMW site for 36 mos. At the end of the lease I've paid a total of $20,800 for the car.
> I walk back into the dealer and hand them the keys. Let's assume a 0 equity position. They roll me into another brand new car. Not assuming any trade up or any difference in financing, at the end of another 3 years, I've paid another $20,800 and wind up with a car that I have to turn in and walk away from, or purchase it outright and finance the balance (assuming a 50% residual on car #2-I have to finance another $21k for the next 5 years-avg auto financing on a purchase). I'm in car #2 for another 5 years with payments of $386/mos at 3.9% financing. Total of another $23,160 in payments. I've paid over the life of 2 cars (11 years!!!) a total of $64,760 to OWN one car. It gets worse if you go for a third or even fourth vehicle.
> 
> On the other hand, purchase that same car and stretch your payments over 6 years at 3.9% financing-$665/mos and you'll own your car for the paltry sum of $47,160 (no down payment). Lets say at the end of 6 years, the BMW has a 30% residual value(????), you have about $12,600 in equity. So, in 6 years, I own a car. If I leased, in 6 years I wouldn't have. It would have taken me 11 years and $64,760 to own 1 car. I'm 5 years and $17,600 richer.
> ...


Recall that the initial lease down payment includes your first month's payment, so you're really talking $20250 after the first 3 years.

Also don't forget tax in your purchase example. You're paying tax on the entire value of the car. Assuming 7% sales tax with the $42k amount your 72-month payments actually total $50475.51 ($701.05 * 72).

You're right - in 6 years you own a car. You've also been on-your-own for maintenance for almost 3 of those (you're driving 15k miles per year, remember?), PLUS your warranty is in the same boat... add even more to your monthly payment starting in year 4 to cover those.



johnnygraphic said:


> Yes, I know the logic, the difference in payments can be saved and accrue interest and you'll be ahead of the game. But, WHO SAVES THIS DIFFERENCE???


I do. :thumbup: I can think of about a dozen ways to spend that extra couple of hundred dollars a month that would give you a better return than a car (especially when you consider the 2% APR difference in my recent lease vs. purchase decision).

A car is a depreciating asset that I wouldn't purchase unless it was going to be extremely cheap to keep running long-term (a BMW does not fall into this category in my opinion) or I had some sort of an extra attachment to it (it's an M-car, it gets raced on the weekend, planning on giving it to the kid, etc.) I've bought other cars before, but always leased BMWs -- they simply have too many extra costs after sticker price to consider as a good long-term investment. If the good lease offers dry up, though, I'll probably change my mind or end up buying a Lexus.


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## Chris90 (Apr 7, 2003)

Rowag said:


> A car is a depreciating asset that I wouldn't purchase unless it was going to be extremely cheap to keep running long-term


When people say don't buy a depreciating asset, I think they mean don't pay cash for it. If you put nothing down and finance it, it's really not that different than leasing - you don't have any money tied into it. Either way you are paying interest, only you are underwater longer with a lease.


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## Chris90 (Apr 7, 2003)

icemanjs4 said:


> I can think of one exception. In my case, I had one semester left of college. Unsure of what the job market would be, I wanted to get a new car with a low price. I could either buy a stripped down Corolla, or lease a better car, with leather, cd changer, moonroof, etc. By getting a 4 yr lease, I forced myself to have at least 3 years on the job with which to save for my next PURCHASE. Now I'm buying a BMW. All around it worked out for me as a single term leaser.


Although it worked out for you, it's clearly not the wisest choice in an uncertain job market, with no job, to lease the more expensive car. If you couldn't find a job, and had to turn in your lease early, you'd be way under water.


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## ragskne (Nov 19, 2004)

I am still grappling with this same dilemma. When I first saw the lease numbers I thought it was a great deal. But then I decided to put my finance degree to work. In the end, the difference between the two after three years was a couple of hundred dollars. With purchasing, I like the fact there are no mileage limits, and if something better comes along in two years I can make a move. In addition, the great state of Pennsylvania has decided to add a 3% lease tax on top of the already ridiculous sales tax of 6 or 7%(depending where you live). For me, this is what has me leaning towards purchasing, no need giving the THE MAN anymore of my hard earned cash.


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## Rowag (Nov 12, 2004)

Dawg90 said:


> When people say don't buy a depreciating asset, I think they mean don't pay cash for it. If you put nothing down and finance it, it's really not that different than leasing - you don't have any money tied into it. Either way you are paying interest, only you are underwater longer with a lease.


 Actually that's the point - you DO have some money in something if you purchase it, regardless of whether you finance it or not.

If your lease payment is $100 a month and a financed purchase payment is $200, then (assuming the same APR on both) you've just bought $100 of the car's principal. As you make more payments the principal amount goes up (while the interest portion of the payment goes down), so next month you own $101 more, then $102 more, etc.

The point of owning a depreciating asset comes into play when you look at the money you've put into the car. You're putting an extra $100+ a month of your money into something that loses value over time. That $100 you put into the car will be worth less than $100 in a year, even if you don't drive it.

Conversely, if you put that $100 into an appreciating asset (a savings account, CD, money market fund, real estate, etc.) then a year later it will most likely be worth more than what you put in.

Now if you DON'T do that and just throw the money down the toilet ("yay, I saved $100 a month by leasing, I can go out to eat more often") then you definitely will be underwater if you leave your lease early versus if you made it a purchase. By purchasing you are forcing yourself into putting money into the principal of the car every month.

The bottom line when you're comparing lease vs. buy is that you need to do what makes financial sense for you based on the terms you can find. Usually if you need unlimited miles or plan on driving the car for a couple of years after you own it, then by all means purchase it. If, however, you can find a good lease deal and you're smart with the remainder of your living finances then it might make more sense for you financially (as it did in my most recent case).


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## Rowag (Nov 12, 2004)

ragskne said:


> I am still grappling with this same dilemma. When I first saw the lease numbers I thought it was a great deal. But then I decided to put my finance degree to work. In the end, the difference between the two after three years was a couple of hundred dollars. With purchasing, I like the fact there are no mileage limits, and if something better comes along in two years I can make a move. In addition, the great state of Pennsylvania has decided to add a 3% lease tax on top of the already ridiculous sales tax of 6 or 7%(depending where you live). For me, this is what has me leaning towards purchasing, no need giving the THE MAN anymore of my hard earned cash.


 Wow, 9% or 10% tax? :yikes: :yikes: :yikes:

That hurts!


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## Chris90 (Apr 7, 2003)

Rowag said:


> Conversely, if you put that $100 into an appreciating asset (a savings account, CD, money market fund, real estate, etc.) then a year later it will most likely be worth more than what you put in.
> 
> Now if you DON'T do that and just throw the money down the toilet ("yay, I saved $100 a month by leasing, I can go out to eat more often") then you definitely will be underwater if you leave your lease early versus if you made it a purchase. By purchasing you are forcing yourself into putting money into the principal of the car every month.


Yeah, that's what I think, if you invest the money you save by leasing, that's good. If you can only afford the $250/month for the lease, you probably are leasing too much car.


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## norihaga (Aug 25, 2004)

johnnygraphic said:


> So, to follow Rowags logic thru after a few leases...I put down $1000 and pay $550/mos on a $42k car with 15k miles per year. (Who really wants to put a measly 12k mileage limit on driving the ultimate driving machine?). Figures are from BMW site for 36 mos. At the end of the lease I've paid a total of $20,800 for the car. I walk back into the dealer and hand them the keys. Let's assume a 0 equity position. They roll me into another brand new car. Not assuming any trade up or any difference in financing, at the end of another 3 years, I've paid another $20,800 and wind up with a car that I have to turn in and walk away from, or purchase it outright and finance the balance (assuming a 50% residual on car #2-I have to finance another $21k for the next 5 years-avg auto financing on a purchase). I'm in car #2 for another 5 years with payments of $386/mos at 3.9% financing. Total of another $23,160 in payments. I've paid over the life of 2 cars (11 years!!!) a total of $64,760 to OWN one car. It gets worse if you go for a third or even fourth vehicle.
> 
> On the other hand, purchase that same car and stretch your payments over 6 years at 3.9% financing-$665/mos and you'll own your car for the paltry sum of $47,160 (no down payment). Lets say at the end of 6 years, the BMW has a 30% residual value(????), you have about $12,600 in equity. So, in 6 years, I own a car. If I leased, in 6 years I wouldn't have. It would have taken me 11 years and $64,760 to own 1 car. I'm 5 years and $17,600 richer.
> 
> ...


At a 58% residual value, a $43k 330 should come in at just under $25k in 3 years. CPO asking prices are in excess of that by a few thousand, but not out of the ballpark (mine was $28 for a $42k car).

Another way to look at it is that, in my car's case, it seems like actual depreciation/cost of use for 3 years was c. $14k. If the original lessee paid $21,000 for that, BMW got a 33% premium above depreciation. I can't claim to be able to do math, but clearly that averages out at c. 11% p.a. Compare that to a 36-month finance rate at 3.9%.

I guess one question is what the $3k a year difference in payments saved the lessee. I have no idea, never having leased, but I understand that leased cars get careful scrutiny when they're handed back, so I doubt he saved that much in maintenance and upkeep.


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## Jim H (Feb 9, 2004)

While I mentioned earlier that I chose to purchase, and that I definitely favor that angle, I do understand how a lease might be right for some people. It's just not right for me. I put down about 25% on my new car, which keeps the payments in check, and my interest rate is only 3.9% over 60 months. This is a comfortable position also because I could sell the car for more than I owe even right off the lot. Nice to be able to get out when I want to.

I plan to keep the car 8 - 10 years. My cost to do that, overall, including maintenance, is far less than leasing 3 times. No, I won't be driving a new car every 3 years, but if I _really _ wanted to do that, then I might consider leasing. I just don't like the idea of having to worry about what I do with my car, how far I drive it, etc. I want it to be mine. And it is--well, it _will _ be...just as soon as I make payment number 60.


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## PFBailey (Jan 9, 2005)

*Leasing vs. Buying*

Lots of math, but not much logic.

The bottom line is you'll pay much more per month to purchase than to lease, especially if you shop for lease specials that come out from time to time. And very few people keep cars the 6-7 years needed to pay them off. So you're never really purchasing anything - just doing a different mode of finacing which costs you more per month. And when you trade in, you don't make any money. You typically lose about as much or more money in depreciation as lease people do in making payments - what's the difference? For 90%+ of us, car payments are just a fact of life, so why pay more per month just to say "I'm buying this, but the bank still owns it!"

Lease unless you drive 20,000+ a year or you're a rare bird who pays off a car and keeps it 8-10 years. And if the "lease" word bothers you, think of it as "option buying".....you can always purchase the car at a depreciated price at lease-end if you really want. The only problem is you'll again be paying more per month to purchase your used car with a 3-year note than you would to lease a new one!

The only thing you have to gain by purchasing is being able to say "That 7-year-old beauty out front is ALL mine!" If that turns you on, go ahead.


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## Dave 330i (Jan 4, 2002)

I have the pick slip.


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## Moderato (Nov 24, 2003)

PFBailey said:


> Lots of math, but not much logic.
> 
> The bottom line is you'll pay much more per month to purchase than to lease, especially if you shop for lease specials that come out from time to time. And very few people keep cars the 6-7 years needed to pay them off. So you're never really purchasing anything - just doing a different mode of finacing which costs you more per month. And when you trade in, you don't make any money. You typically lose about as much or more money in depreciation as lease people do in making payments - what's the difference? For 90%+ of us, car payments are just a fact of life, so why pay more per month just to say "I'm buying this, but the bank still owns it!"
> 
> ...


I've thought about this too. Let's say you buy a 42K car cash and keep it for 10 years and drive it for 13.5K miles per year. How much would a 42K car be worth after 10 years with 135,000 miles? I'm guessing 5K. How much would you have spent in repairs during the last 6 years of ownership? Lets say on average 6K for the last 6 years. OK, do the math and that works out to be 42K - 5K (sale price) + 6K (maintenance cost) = a cost of ownership over 10 years to be 43K. (not counting insurance & property tax if your state has that). 43,000 / 120 months = $358.33 per month. So if you buy a brand new car and keep it for 10 years and then sell it, it will be cheaper then leasing.  If it's worth another 150 - 300 per month to always have a new BMW in your garage, then lease or sell it early.


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## mhiggi02 (Jan 8, 2005)

Alamo said:


> Buy, pre-owned Certified. Let someone else take the hit and you still get the warranty


Ditto :thumbup:


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## PFBailey (Jan 9, 2005)

*Leasing vs. Buying*



Moderato said:


> I've thought about this too. Let's say you buy a 42K car cash and keep it for 10 years and drive it for 13.5K miles per year. How much would a 42K car be worth after 10 years with 135,000 miles? I'm guessing 5K. How much would you have spent in repairs during the last 6 years of ownership? Lets say on average 6K for the last 6 years. OK, do the math and that works out to be 42K - 5K (sale price) + 6K (maintenance cost) = a cost of ownership over 10 years to be 43K. (not counting insurance & property tax if your state has that). 43,000 / 120 months = $358.33 per month. So if you buy a brand new car and keep it for 10 years and then sell it, it will be cheaper then leasing.  If it's worth another 150 - 300 per month to always have a new BMW in your garage, then lease or sell it early.


==================
I agree Moderato, it just ain't worth it! And since nobody pays cash, you have to count interest for a 5-6 year loan......so $42K is more like $46K. So that's nearly $400 a month to avoid leasing for....$400 a month!

Another factor you need to add in is the "cost" of explaining to women you meet along the way exactly WHY :smokin: you're driving a 8, 9 or 10-year-old piece of junk!


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## adgrant (Aug 13, 2003)

Moderato said:


> I've thought about this too. Let's say you buy a 42K car cash and keep it for 10 years and drive it for 13.5K miles per year. How much would a 42K car be worth after 10 years with 135,000 miles? I'm guessing 5K. How much would you have spent in repairs during the last 6 years of ownership? Lets say on average 6K for the last 6 years. OK, do the math and that works out to be 42K - 5K (sale price) + 6K (maintenance cost) = a cost of ownership over 10 years to be 43K. (not counting insurance & property tax if your state has that). 43,000 / 120 months = $358.33 per month. So if you buy a brand new car and keep it for 10 years and then sell it, it will be cheaper then leasing.  If it's worth another 150 - 300 per month to always have a new BMW in your garage, then lease or sell it early.


Maintence costs will vary depending on where you live. Where I live BMW mechanics charge in excess of $90 an hour. A brake job costs about $1,000. An inspection almost $800. I think the second inspection is even more. I prefer to drive a new BMW and not pay any maintence at all. I probably don't save any money after deprecation, but it keeps my blood pressure in check. Plus I get a new car every three years.


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## flashinthepan (Jul 25, 2003)

I have never seen a lease I liked. :thumbdwn:


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## cheng6991 (Jan 15, 2004)

I plan to lease a 330i ZHP with Xenon, leather , and cold weather package this month. Dealer incentives is $3800. What will be a good price in terms of monthly payment ? Sales tax is 8%.


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## SealBeemer (Jul 7, 2004)

Bought. Paid cash. Old fashioned: Save your money, earn interest, don't pay interest on a depreciating asset. Leasing is very expensive in the long run. IMHO.


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## PFBailey (Jan 9, 2005)

*Leasing vs. Buying*

Paying cash is great. But if any of us had the option of paying $40+K cash, we wouldn't be having this discusssion!


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## njnyc330i (Nov 3, 2003)

I leased it under my personal company.... and wrote it off as a business expense. I loved the car so much, I bought it for my personal "company car" lol!


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## Chris90 (Apr 7, 2003)

PFBailey said:


> You typically lose about as much or more money in depreciation as lease people do in making payments - what's the difference?


Except that if you finance, and then sell privately, you'll most likely suffer less depreciation than if you lease.


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## Chris90 (Apr 7, 2003)

PFBailey said:


> Another factor you need to add in is the "cost" of explaining to women you meet along the way exactly WHY :smokin: you're driving a 8, 9 or 10-year-old piece of junk!


My girlfriend, who has a six figure stock portfolio, required no such explanation.

Some of my friends though . . .


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## Chris90 (Apr 7, 2003)

adgrant said:


> Maintence costs will vary depending on where you live. Where I live BMW mechanics charge in excess of $90 an hour. A brake job costs about $1,000. An inspection almost $800. I think the second inspection is even more. I prefer to drive a new BMW and not pay any maintence at all. I probably don't save any money after deprecation, but it keeps my blood pressure in check. Plus I get a new car every three years.


Absolutely, if I didn't have access to a great BMW shop ($55/hour), and had to take my car to a dealer, no way I'd own an old BMW.

The shock is bad enough at $55/hour!

This is also a hidden cost of owning a Lexus, Acura or Infiniti - you'll pay probably 3 grand in the first 3-4 years that you won't pay with a BMW.


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## xspeedy (Apr 10, 2003)

Paying cash is the best move. It is the only way I'll buy a car. People talk about using the cash to earn more than what they pay in interest (same logic for leasing), but my portfolio is flat. Interest rates suck, so my cash isn't earning anything either.


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## brkf (May 26, 2003)

xspeedy said:


> Paying cash is the best move. It is the only way I'll buy a car. People talk about using the cash to earn more than what they pay in interest (same logic for leasing), but my portfolio is flat. Interest rates suck, so my cash isn't earning anything either.


Buy a house with the cash, finance the car. Rent the house, get lower taxes, an appreciating asset and that easily covers the cost of the car. :thumbup:

dropping 40k on a car is essentially pissing away 8k in year one alone. put the same dough into a house and you've got well over 10k in deductions in year one alone.

A minimum 15% ROI, plus no real out of cash expenses on the house. Can't go wrong.


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## Chris90 (Apr 7, 2003)

blueguydotcom said:


> Buy a house with the cash, finance the car. Rent the house, get lower taxes, an appreciating asset and that easily covers the cost of the car. :thumbup:
> 
> dropping 40k on a car is essentially pissing away 8k in year one alone. put the same dough into a house and you've got well over 10k in deductions in year one alone.
> 
> A minimum 15% ROI, plus no real out of cash expenses on the house. Can't go wrong.


Then strip the equity from your two houses with an ARM, and buy stocks!


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## James (Jun 30, 2004)

*Blue vs Green*

Blue is obviously a much better color then green. Anyone who says otherwise clearly has not read all the posts or never gone to school. I will always choose blue over green.

That's all I have to say about lease vs buy 

James.


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## xspeedy (Apr 10, 2003)

blueguydotcom said:


> Buy a house with the cash, finance the car. Rent the house, get lower taxes, an appreciating asset and that easily covers the cost of the car. :thumbup:
> 
> dropping 40k on a car is essentially pissing away 8k in year one alone. put the same dough into a house and you've got well over 10k in deductions in year one alone.
> 
> A minimum 15% ROI, plus no real out of cash expenses on the house. Can't go wrong.


If the choice is to put the cash into a car OR put the cash into a car, I would pay cash for the car and finance the house. At least mortgage interest can be deducted. My house hasn't appreciated much in the four years I've had it. The east and west coasts are booming, but Austin seems a bit flat.

I should be a contrarian.


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## brkf (May 26, 2003)

xspeedy said:


> If the choice is to put the cash into a car OR put the cash into a car, I would pay cash for the car and finance the house. At least mortgage interest can be deducted. My house hasn't appreciated much in the four years I've had it. The east and west coasts are booming, but Austin seems a bit flat.
> 
> I should be a contrarian.


Uh, you'd be financing the house too. And why wouldn't you buy in a location that's seeing a surge? I'd assume by buying a bimmer with cash you're talking 40k. Drop 40k on a small 200k condo/townhouse, mortgage 160k (about 1100 a month). then rent that place. You've now got deductions up the wazoo - taxes, repairs, depreciation. Plus the house goes up in value at least 10% a year. Plus you can travel to that new area and deduct the expenses. And if you don't want to handle the renting, let another place do it and they'll skim 10% or so off the top. Doesn't matter as that's a deduction too.

Sorry, in this market, paying cash for a car is throwing good money away. That money can be used to make so much extra dough it's silly. You can get a 40k bimmer on a 1.9% 60 month loan, and the amount you'd get in just tax deduction savings/returns would easily make the payments, WHILE the home appreciates. After five years you'd have an asset worth far more than your car, which was paid for by other people paying your rent!

Buy a bimmer for 40k, have a car with 32k the next year. Buy a condo with the 40k, have a good 10k in rightoffs at least and an asset worth 60k clear for you (40k down, minimum 10% appreciation on 200k = 20k).

huh, 60+k or 32k. Gosh, tough choice. :rofl: By year two, we're talking 27k v. 80k+. Heck, even without 10% appreciation, the rightoffs make it worth your while.


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## Chris90 (Apr 7, 2003)

blueguydotcom said:


> Plus the house goes up in value at least 10% a year.


Not really a student of history are you?


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## mbr129 (Aug 23, 2002)

Rowag said:


> ...3 years worth of maintenance (and wipers, rotors, pads, etc., etc.) can easily add up to a couple thousand bucks...


  How? A complete rotor + pad job at a stealership would cost at MOST $1500 (considering it is a less than $300 DIY job) and wipers?? :tsk: What, $20 at the most?. How does that add up to even 2K?

A lot of people make it to 50K miles on the original rotors.

Don't get me wrong, it is nice to have the free maintenance but be realistic.


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## jetstream23 (Mar 9, 2004)

xspeedy said:


> Paying cash is the best move. It is the only way I'll buy a car. People talk about using the cash to earn more than what they pay in interest (same logic for leasing), but my portfolio is flat. Interest rates suck, so my cash isn't earning anything either.


Half cash, half financed at 3.9% even though I could have paid cash in full. I should earn better than 4% on my money in the long-term (i.e. the length of the 5 year loan) in a diversified portfolio.


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## brkf (May 26, 2003)

Dawg90 said:


> Not really a student of history are you?


In Ca over the course of 20 years the prices have only climbed. Little drops but as with any investment like this it's a longterm thing. You don't buy rental properties looking to exit within the next 3 years- unless you want to jump to bigger properties. Obviously if the market takes a big enough dive you'll have to hold out and wait for it to rise again. Which it will.


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## jetstream23 (Mar 9, 2004)

mbr129 said:


> How? A complete rotor + pad job at a stealership would cost at MOST $1500 (considering it is a less than $300 DIY job) and wipers?? :tsk: What, $20 at the most?. How does that add up to even 2K?
> 
> A lot of people make it to 50K miles on the original rotors.
> 
> Don't get me wrong, it is nice to have the free maintenance but be realistic.


Free maintenance isn't really free, right? It's built into the cost of the car. My question - how much would the maintenance cost on a 330i for 4 years if you had to pay for it? Oil changes, inspections, brakes, wipers, etc.? Are we talking about $1,000 or more like $3,000 over 4 years?


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## adgrant (Aug 13, 2003)

jetstream23 said:


> Free maintenance isn't really free, right? It's built into the cost of the car. My question - how much would the maintenance cost on a 330i for 4 years if you had to pay for it? Oil changes, inspections, brakes, wipers, etc.? Are we talking about $1,000 or more like $3,000 over 4 years?


If you need new brakes (quite possible with an Xi) it will definitely be over $1000. Also the warranty is 4 years not 3.


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## 325SMG (Jan 11, 2004)

Purchase, via ED.


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## 3Aims (Mar 25, 2004)

The lease buy situation is typically dependent on the long-term value of the car. If the car has a good historical residual value, you'll probably break even on the buy versus lease situation or come out slightly ahead. If the car does not have a good residual value, you should lease. You can't go wrong with a BMW in my opinion.


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## xspeedy (Apr 10, 2003)

325SMG said:


> Purchase, via ED.


I second that. That is how my BMW habit is viable.


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## hecklerz (Dec 28, 2004)

Lease- 36 months. Will negociate a early buyout for a no money down new (new car) lease in 2 to 2.5 years.


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