# Received a lease quote, what should I counter-offer?



## cozia83 (Dec 24, 2007)

Why can't they e-mail you said scenarios?

I think he realized the mistake(?) with the markup of the MF and now is trying to win you back...

Still, I don't think maximum MF dealer markup is very fair. At least have them meet you half way. Same with the acquisition fee, at least get them to go with $725. As for the doc fee, that may just have to be something you'll have to pay, unless you go with a different dealer.


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## skwirl (Jan 27, 2008)

cozia83 said:


> Why can't they e-mail you said scenarios?
> 
> I think he realized the mistake(?) with the markup of the MF and now is trying to win you back...
> 
> Still, I don't think maximum MF dealer markup is very fair. At least have them meet you half way. Same with the acquisition fee, at least get them to go with $725. As for the doc fee, that may just have to be something you'll have to pay, unless you go with a different dealer.


I would think these F&I guys have the formula down to a pat now but mistakes do happen, so I'll give them the benefit of doubt there.

Definitely checking out all the other dealers in Washington and Oregon state now. Man this thread has been invaluable for my first time leasing experience. :thumbup:


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## skwirl (Jan 27, 2008)

I've decided not to deal with this dealership, but for those of you who have been following/advising me on my lease negotiations since the beginning here's the follow-up response I received from them.

"you are absolutely correct. There was a mistake made in the sheet that I gave you. The Money factory should have been .00215 with no adder. Sorry about that. We ran a number of scenarios for you and still are unable to come to terms with the calculations that you provided us using the multiple security deposits. The scenario that you laid out tends to be a bit confusing so perhaps something is missing. With no disrespect intended towards you, you intimate that you are not getting a ***8220;fair***8221; deal from us because we won***8217;t negotiate on company mandated items. I definitely would work on the selling price of the car for you, maybe even provide you with free mats and a couple of key chains. In talking to (MANAGER), the MSD scenario oftentimes will raise your payment not lower it. So, I guess if we give it one more shot what would it look like? How much cash down will you do in order to achieve the payment that is most comfortable for you? How much are you willing to pay for our car? The scenario that I quoted you $2,500 plus fees is not out of round with what our other customers are paying. I think that if we work towards a common ground we can still have a car deal and you won***8217;t have to go east or south in order to purchase a vehicle."


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## snowbunni (Dec 19, 2007)

"In talking to (MANAGER), the MSD scenario oftentimes will raise your payment not lower it." :loco:

I ran into some real characters myself when I was shopping for a car in the Seattle area. Including CAs who made honest mistakes like quoting the wrong model car or forgetting to add options. This joker is just completely misinformed. He also can't know enough about MSDs if he has to get a manager to explain how they work. Run, run, run away!!!

I should add that the two larger dealerships in the metro area were both not willing to give me BMWFS base rate and cited dealership/ownership policy as the reason, too. One of them was insulted that I should even ask for no MF mark-up and told me to take my business elsewhere. So, I did!


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## travel4B (Dec 1, 2005)

Amusing - especially the part about how MSD's will sometimes raise your payment. I want some of what he's smoking!

You really should send him a link to this thread when you give him the heave-ho.


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## cozia83 (Dec 24, 2007)

skwirl said:


> "you are absolutely correct. There was a mistake made in the sheet that I gave you. The Money factory should have been .00215 with no adder. Sorry about that. We ran a number of scenarios for you and still are unable to come to terms with the calculations that you provided us using the multiple security deposits. The scenario that you laid out tends to be a bit confusing so perhaps something is missing.


This guy seems to not understand leasing.



> With no disrespect intended towards you, you intimate that you are not getting a "fair" deal from us because we won't negotiate on company mandated items.


This one made me laugh. "Company mandated items"? BMW says you _can_ mark up the MF by 0.0004, not that you _must_.



> I definitely would work on the selling price of the car for you, maybe even provide you with free mats and a couple of key chains.


Maybe, hugh? :rofl:



> In talking to (MANAGER), the MSD scenario oftentimes will raise your payment not lower it.


That's preposterous! Again, this guy either really doesn't understand BMW's lease structure, or is just "conveniently ignorant."



> So, I guess if we give it one more shot what would it look like? How much cash down will you do in order to achieve the payment that is most comfortable for you? How much are you willing to pay for our car?


Obviously, you are willing to pay exactly what you quoted him in your e-mail.



> The scenario that I quoted you $2,500 plus fees is not out of round with what our other customers are paying. I think that if we work towards a common ground we can still have a car deal and you won't have to go east or south in order to purchase a vehicle."


Yeah...no.


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## mclaren (Jan 5, 2005)

I would send him an email saying "Since your company policy is to mark up everything to the max in the finance department I will lease my BMW elsewhere. Also, multiple security deposits ALWAYS lower the monthly payment since they are a reduction in the money factor."
What I think is going on here is the CA is allowed to negotiate the price of the car and the finance department marks up the MF .0004 and the LAQ to $825. Working that way they could sell you the car at flat invoice and come out O.K. What it boils down to is this method gets them at least MSRP on every deal. Since many people want a discount from MSRP this is their way of getting it.


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## skwirl (Jan 27, 2008)

I just can't stop responding even though I'm totally not going to do business with them. Anyways, here's my response incorporating all of your comments in response to their last email. I'll post their response if they decide to tackle this. 

********

"I triple checked my lease numbers using a lease spreadsheet calculator. They gave me the correct monthly payments when I plugged in the figure from your original lease quote, so I'm positive the spreadsheet formulas are correct.

When you say "company mandated items" in reference to the money factor and acquisition fee, you are referring to BMW (DEALERSHIP)'s mandate right? As I understand it, BMW Financial says the dealer can mark up the money factor and acquisition fee if they choose to, but they're not required to.

I don't mean any disrespect to you or (MANAGER), but I'm surprised to hear your explanation on MSD. Multiple security deposits ALWAYS lower the monthly payment since they are a reduction of the money factor. Reduce the money factor, reduce the monthly payment. This is the very reason why BMW (DEALERSHIP) won't allow us to negotiate the money factor in the first place. There's no way a monthly payment will increase when you lower the money factor on a lease. Perhaps your finance department is hoping I'll try to negotiate the money factor UP so that I can lower my monthly payment?

Here's what I think the scenario is on your end, please correct me if I'm wrong. BMW (DEALERSHIP)'s finance department sets the acquisition fee and money factor to the maximum mark-up and refuses to negotiate on them. They do however, allow their client advisors to negotiate the selling price of the vehicle. Working this way, you can sell me the car at the flat invoice price and still come out great on the deal. You're practically guaranteed to get MSRP on every car deal you make once you collect the profits from the marked up acquisition fee and marked up money factor.

To answer your question, you already know how much I'm willing to put down and pay for the car, I've sent you two lease proposals. I'd be more than happy to check out some of the scenarios your finance team has created with MSD figures. I absolutely believe you when you say your original offer is around what your other customers have paid but that doesn't make it a fair deal, it just means a lot of your customers are paying more than they should on their deal."


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## cozia83 (Dec 24, 2007)

Well done! :clap: :beerchug: I especially liked this part:



skwirl said:


> Perhaps your finance department is hoping I'll try to negotiate the money factor UP so that I can lower my monthly payment?


:rofl:


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## skwirl (Jan 27, 2008)

Response from the CA posted below:

*****

"When I refer to company mandated items, I refer to (PARENT COMPANY), our parent company. The $825 acquisition fee is a standard rate and yes, it is marked up $200. The money factor is set by BMW and yes, we can mark it up which we do. We have a right to make money. There is nothing sinister about how we do business the money factor and acquisition fees are pretty standard across the board. We fully disclose these fees and people can either accept them or not. Just because a customer thinks that we should negotiate it doesn't mean that we have to.In 99.5% of cases none of this is questioned. It is what it is and people accept it. On the issue of MSDs sometimes the payment DOES go up because clients put less cap reduction down in lieu of the money used for the MSDs. But that is an issue unto itself.

Nobody is asking you to negotiate up the money factor. As said, it is what it is. I have tried to be up front and honest about what we can and cannot do. Honestly, I am saddened by the tone of you e-mail as it implies that we are not a trustworthy organization. Most negotiations that I undertake are a give and take this one has the tone of only us giving. I have seen no give on your part. As I have stated a number of times, we are a business and have a right to set our parameters as to how much we will or will not make on a deal. And since it appears that you are firm in what you want out of this deas this is definitely not going to work. Good luck elsewhere"


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## want_a_7 (Apr 4, 2006)

Wow. I really like the "Good luck elsewhere". With the internet, email, fax, and shipping you can really buy form anyone. My local dealerships were the same way. If you decide to look south, try Phillep K at South Bay BMW. He has done a great job for us.


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## Orient330iNYC (Jul 30, 2002)

skwirl said:


> Response from the CA posted below:
> 
> *****
> 
> ...


i translate this into: our way or the highway. 
i think its time to see if you can work out a deal with Ty Vil or another 'fest sponsor.

crunching the numbers, 1200 over invoice dealer profit including MACO and training, full MSD buydown, no markup on the LAF or MF
$491.27 a month
due at signing:
tax
8 security deposits totalling 4K
first month
doc fees
LAF of $625


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## 0utlier (Jan 28, 2008)

"In 99.5% of cases none of this is questioned. It is what it is and people accept it."

This is what I hear... Dammit, you're supposed to shut up, let me tell you the numbers, and just be happy I'm talking to you. 

Wow! What hubris and arrogance. He seems unamused that you know the numbers, know how to calculate a lease, and know what is and is not a fair deal. Amazing.


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## skwirl (Jan 27, 2008)

Orient330iNYC said:


> i think its time to see if you can work out a deal with Ty Vil or another 'fest sponsor.


I've been in contact with Ty since Monday and he has the ISM looking into stock. Road tripping back to Washington in a new BMW sounds like fun the more I think about it. :thumbup:


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## Bruin72 (Feb 3, 2005)

Good luck, skwirl! You absolutely did the right thing, and you will be rewarded by your willingness to educate yourself on BMW leases. With perseverence, you will wind up with the deal you are seeking. I did!


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## snowbunni (Dec 19, 2007)

I was going to PM you skwirl and ask you who you were dealing with, but there was a line or two that sounded all too familiar to me. This is a quote from the last message I received from what sounds like the same CA:

"I can discount a car for you, but I cannot negotiate the rates. They are what they are. Please let me know if you would like to proceed. Thank You."

Hey, got to admit that they are at lease consistent!

I bet you he's accurate in saying that 99.5% of Seattle customers just take what is being offered because they can't be bothered (or too embarassed) to negotiate or to learn how a lease works. At least this was the case when money seemed to grow on trees because local tech company stocks were soaring.


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## cozia83 (Dec 24, 2007)

Ok, so looks like that dealership will be out of business in a few years. Maybe not, if the people of Seattle are willing to just go by their terms...But I can't see them keeping customers, especially when you can order from a CA practically anywhere in the US and do ED or PCD.

I'm glad you didn't go with them. Don't feel bad about posting a negative review of them, stating the dealership name, on the Feedback thread. We need to help the dinosaurs into extinction (and support the fair dealerships).


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## skwirl (Jan 27, 2008)

I originally went to them because I had heard great things about their dealership. Maybe when the large corporate chain took them over policies were changed around for the worst.

On the flip side, Ty Vil and Josh Wight from Rasmussen BMW seem like very nice people. Josh is their ISM and he was very honest and open about how I should approach the deal with the numbers I was hoping to get on the lease. Unfortunately, they don't have any 328xi models in stock with the interior option that I wanted (aluminum) so I'll have to try doing business with them next time down the road.

In my shopping for a 328xi I was also interested in a couple of other cars and emailed the dealerships about their advertised leases. There's one in particular that wouldn't add up when I inputted their lease figures into my spreadsheet, I kept getting higher monthly payments than what they claimed when I did the calculations with the buy rate. I emailed the ISM for some clarification on what the MF was and this is what he said:

"The MF needs to be calculated with residual amount of 55%. Meaning the residual amount
has interest rate calculated from the money factor.
We have the correct number. Let me know."

Um, is there a legit reason why he won't tell me the MF? Is this another potential max-mark up, get you on the back end deal waiting to happen?


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## snowbunni (Dec 19, 2007)

skwirl said:


> Road tripping back to Washington in a new BMW sounds like fun the more I think about it.


I'm not a fan of I-5 traffic around Tacoma--particularly on rainy/snowy weekends.

Another option is to flat-bed the car up from Oregon. I received a quote of $300 from my CA.


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## cozia83 (Dec 24, 2007)

skwirl said:


> Unfortunately, they don't have any 328xi models in stock with the interior option that I wanted (aluminum) so I'll have to try doing business with them next time down the road.


A few questions for you, skwirl:
-Since it's just a lease, is the lack of aluminum trim really so important as to be a deal breaker?
-What radius did they check when searching for a car with the options you wanted? Maybe this can be increased.
-Have you considered ordering the car?

I know ordering takes a while for delivery, but at least you get exactly what you want, at the price you want. I had to order mine (and am still waiting) because there were none in the _country_ with the options I wanted (there was 1 with two additional options, but I didn't want to pay another $1,000 for things I really did not want to have).


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## skwirl (Jan 27, 2008)

snowbunni said:


> I'm not a fan of I-5 traffic around Tacoma--particularly on rainy/snowy weekends.
> 
> Another option is to flat-bed the car up from Oregon. I received a quote of $300 from my CA.


Oh I agree about the traffic on the weekends. I'd probably take a Monday or Friday off from work and do it then. The cost of flat bedding sounds good too now that you mention it.



cozia83 said:


> -Since it's just a lease, is the lack of aluminum trim really so important as to be a deal breaker?
> -What radius did they check when searching for a car with the options you wanted? Maybe this can be increased.
> -Have you considered ordering the car?


I know it's silly, but the interior is the one thing that I can't be convinced to budge on. I admit I'm overly picky about this. 

The way Josh had explained it to me was that I would have a better chance of getting the deal I'm looking for if I made the offer on a car that's in-stock and racking up a lot of floor interest. He said that the dealerships will generally use the mark-up as a tool to make in-stock purchases look a bit more attractive than a marked-up custom-order or located car.

I have considered ordering the car but I'm also looking at some other make/models out there so I'm not ready to place an order just yet. Maybe I just might have to.


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## cozia83 (Dec 24, 2007)

skwirl said:


> I know it's silly, but the interior is the one thing that I can't be convinced to budge on. I admit I'm overly picky about this.


I don't blame you; the interior is what you see all the time. It needs to be a good environment for you (e.g. for me, the tan interior makes me antsy).



> The way Josh had explained it to me was that I would have a better chance of getting the deal I'm looking for if I made the offer on a car that's in-stock and racking up a lot of floor interest. He said that the dealerships will generally use the mark-up as a tool to make in-stock purchases look a bit more attractive than a marked-up custom-order or located car.


I really don't know about this, maybe someone else can chime in. I got the Costco deal, as I've said before, on an ordered car, so I don't see what the real difference would be, just that they want to move their inventory.

Anyway, good luck in finding what you want, and keep updating us!


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## suplink (Jan 14, 2008)

*328xi quotes HELP!*

Here are some quotes that I have received and I tried to use the spreadsheet but no luck.

Besides, I have no idea where to put or what to put in some of the cells. All I have learned is the MSRP,DealerInvoice, Cap Cost, MF, Residual. So here it is. I would appreciate some feedback, & be frank about it. Those dealers who read this, well it's as you say, you do this to make a living so it's understandable why "things" shift around in a quote.:thumbdwn: But honestly, it's not like the dealerships are being bombarded with "internet" savvy, knowledgable, prospective buyers. There are many, many buyers who walk in the door without knowing anything, or much, so give them the "marked" up numbers, and keep us as your loyal, constant clients. :angel: Whatmore could you ask for?

328xi sedan
Premium Package, CWP, Auto. comfort access. NOTHING MORE
31,555, 2960, 1210, 775 & 455 respectively.
Add: 775(?) dest. charge
Paint: 430
TOTAL: $38,160

MSRP: 34,300
3250, 1275, 850, 500 respectively.
Add: 775 (?) destination charge
Paint 475
TOTAL: $41,425 :rofl:

Will pay 1st month, DMV registration , (have plates so will keep them), Long Island, NY tax : 8.625%, pay for vehicle inspection here in NY!; bank fee 625.:angel:

Would like to make a few MSD's to lower MF - but don't know how to do it.:dunno:

CUrrent BMW owner X5
-------------------------------------------------------------------------------------------- 
Quote 1
499 with $2024.00 at signing which included 'dp'of $400 and local tax and tags additional. Have not seen dealerinvoice price. This is a NJ Dealer
--------------------------------------------------------------------------------------------
Quote 2
Base MSRP: $34,300 Invoice:38,060
Paint: 475 MarkUp: 750
CWPPKG:AUTO: DEST: =850 + 3250 + 1275 + 775
TOTAL: $40,925.00 TOTAL:$38,810.00

36/45k with 61%Residual and .00185 (instead of .00175)MF. Marked up by .00010

$553.18 Mth (LI tax 8.625% included in payment)
$1,447.09 due at signing which is the following breakdown:
553.18 1st mth payment
625.00 bank fee
53.91 TAX on bank fee (???? Never heard of this!)
150.00 NY Plate Fees ( Will use my plates, no new plates needed)
10.00 NY State Tire Tax (?)
45.00 Dealer Doc Fee
10.00 NY State Inspection Fee (New Jersey cannot inspect vehicle for NY!

Security is waived through loyalty by BMWFS. This is a NJ Dealer!
-----------------------------------------------------------------------------------------------------
Quote #3 Comes from Dealer Disclosure Sheet. BTW This is how it should be shown to us, don't you think?:eeps:

Vehicle Cost: 36,865 MSRP: 39,175.00
Money Due at Inseption
548.31 1st mth
105.00 Fees & Insurance
Upfront Taxes 12.50
Total out of Pocket:665.81

Profit
Markup $450

Rate Information: Retention Rate-0.00175
Disclosed Rate - 0.0175

Residual Information: MSRP $39,175
Low MSRP $43,025.00 (WHAT IS THIS?)
RESIDUAL Base : 61

Capitalized Cost:
Vehicle cost: 36,865.00
Markup 450
Total Selling Price: 37,315.00
Acquisition Fee: 625.00 (Isn't this the same as bank fee of 625? Charged twice?)

Capital Cost: 37,940.00
Capped Taxes: 1,693.33 (WHAT IS THIS? WHERE DOES THIS COME FROM?)

Tax Breakdown:
Tire Tax 12.50
Upfront 1,693.33 8.6250 Capped

Mileage:
15,000
Additional: 0.15
Total Mileage: 45,000
Excess Mileage: 0.20

Total Residual: $23,896.75
Purchase Option: 23,896.75

Maximum Advance Information:
(WHAT IS THIS???)
MAX 41,493.33

Max 100.00

Miscellaneous Information:
Tax Credit:0.00
Max. 0.00040 (WHAT IS THIS???? HUH???)

Fee Breakdown:
Inspection: 10.00
Title 50.00
Doc Fee 45.00

This is a NY dealer.:eeps:

Please get back to me.
Does anyone know if the Residuals & MF's will be better tomorrow on this vehicle since it is getting "older"? How about the x5's.......ANYBODY?????:bawling:


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## cozia83 (Dec 24, 2007)

SUPLINK, you can try my lease calculator. It's a little less complicated. You need to change most of the values as applicable to your situation.

https://carmen.osu.edu/pages/personal/150016/BMWLeaseCalculator.xls

EDIT: I just noticed that you're in NY, so I don't really know what that changes...Sorry.


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## suplink (Jan 14, 2008)

Thanks. Will do & will be back to let you know what the dealers offered. Just one thing - it is so true that when a CA avoids emailing you the dealer breakdown after repeated attempts, it's time to move on.

Here's a question for anyone. Why can't we ask specifically via email for the "internet Sales Manager/& or General Sales Manager? Why is it that we always end up with an "internet client advisor", which is code for salesperson? Thats where I think the problem stems. They need to make their commission and numbers and the managers are salaried and they don't give a hoot and will get the vehicle off their lot. Whats everyone's thought on that?


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## cozia83 (Dec 24, 2007)

SUPLINK, make sure to take note that I don't know what will change for NY. So don't take my calculator for gospel, ok?


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## cozia83 (Dec 24, 2007)

SWIRL, any progress? Hopefully you're closer to getting your car by now. Let us know how it's going!


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## skwirl (Jan 27, 2008)

cozia83 said:


> SWIRL, any progress? Hopefully you're closer to getting your car by now. Let us know how it's going!


Not much happening on my end so far. I've been very busy with work lately so I haven't done anymore shopping researc. I'll post updates if I have anything new to share with you all! :thumbup:


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## psucelticXI (Nov 19, 2007)

skwirl said:


> Not much happening on my end so far. I've been very busy with work lately so I haven't done anymore shopping researc. I'll post updates if I have anything new to share with you all! :thumbup:


In one of my searches, I came to this thread. Any updates skwirl?


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## MarcusSanDiego (Jan 7, 2002)

skwirl said:


> Hi everyone!
> 
> First time posting. Been reading this forum for the past couple of days to see how the lease deals are going. I walked into a BMW showroom today and asked about leasing a 2008 BMW 328xi sedan. With no haggling, here are the figures they gave me for a 36 month, 12,000 mile lease:
> 
> ...


Skwirl, what dealership was this? I'll be avoiding these clowns.


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