To Lease or Not To Lease....

[1ofthe1]

Wanted to share my situation and why I ended up choosing the lease option.

I made a decision that I did not want to own this car without a warranty so I was evaluating total cost over 6 years/90 K miles rather than a monthly payment that I could swing. So, given that assumption, my lease deal turned out to be pretty close to buying/trade-in.

Buy: invoice + dealer profit + upfront costs + finance payments + 1 set of tires + CPO costs - trade in amount = total cost of owning car for 6 years


The problem was that there were no good financing rates like 0% or 0.9% available and even if I could pay cash up front, I would have to pay the full sales tax and then take a loss on the trade-in. Plus, it was tough negotiating a deal close to invoice price. At the end of the warranty 4yr/60K, I would trade it in but turn it into a CPO and get the extended warranty up to 6yr/100K. The problem is that you have to pay for whatever is needed to get the CPO certification (repair all dents, dings, scratches, new tires, etc. which averages around $2,000 from what I was told) and then take another loss at the next trade-in at the end of the CPO.

Lease: I didn't have to pay the full sales tax up front. I was able to get a 2 year lease which means the car wouldn't need new tires by the time I turned it in for a new one. I was able to get a deal ($500) on their Lease Protection Plan which covers all of the repairs (up to $5K) when you turn it in and they put that amount into the lease payment. The total came out to $15K for 2 years @ 15K miles/year including lease payments and up-front costs. Because BMWFA likes to lease cars, they have an owner loyalty program where you can get your next car at same or better lease terms. I made the assumption that I could expect another $15K for the next car in 2 years from now and so on. So total cost of leasing would be $45K for 6 years.

I went with the lease because it was so close. Plus it means a brand new car every 2 years and although I do wash it every week treat it like my baby, I kinda feel like I can really have fun with it without worrying about long term effects.... if you know what I mean.

Thoughts?? Comments??

[lamini]

buy it with zero down and finance it for 7 years......you'll be able to sale it for the balance after 3.5 years.
I've done that twice with my last two cars.

[Qube]

Lease it. When (and hopefully if) the hatch comes, get that

[aus]

Originally Posted by 1ofthe1

Wanted to share my situation and why I ended up choosing the lease option.

I made a decision that I did not want to own this car without a warranty so I was evaluating total cost over 6 years/90 K miles rather than a monthly payment that I could swing. So, given that assumption, my lease deal turned out to be pretty close to buying/trade-in.

Buy: invoice + dealer profit + upfront costs + finance payments + 1 set of tires + CPO costs - trade in amount = total cost of owning car for 6 years


The problem was that there were no good financing rates like 0% or 0.9% available and even if I could pay cash up front, I would have to pay the full sales tax and then take a loss on the trade-in. Plus, it was tough negotiating a deal close to invoice price. At the end of the warranty 4yr/60K, I would trade it in but turn it into a CPO and get the extended warranty up to 6yr/100K. The problem is that you have to pay for whatever is needed to get the CPO certification (repair all dents, dings, scratches, new tires, etc. which averages around $2,000 from what I was told) and then take another loss at the next trade-in at the end of the CPO.

Lease: I didn't have to pay the full sales tax up front. I was able to get a 2 year lease which means the car wouldn't need new tires by the time I turned it in for a new one. I was able to get a deal ($500) on their Lease Protection Plan which covers all of the repairs (up to $5K) when you turn it in and they put that amount into the lease payment. The total came out to $15K for 2 years @ 15K miles/year including lease payments and up-front costs. Because BMWFA likes to lease cars, they have an owner loyalty program where you can get your next car at same or better lease terms. I made the assumption that I could expect another $15K for the next car in 2 years from now and so on. So total cost of leasing would be $45K for 6 years.

I went with the lease because it was so close. Plus it means a brand new car every 2 years and although I do wash it every week treat it like my baby, I kinda feel like I can really have fun with it without worrying about long term effects.... if you know what I mean.

Thoughts?? Comments??

What was your drive off and payments? Any chance you got the money factor, residual and sale price?

[paologaspar]

Originally Posted by lamini

buy it with zero down and finance it for 7 years......you'll be able to sale it for the balance after 3.5 years.
I've done that twice with my last two cars.

Sounds interesting. can you elaborate on this with some real world numbers??

[1ofthe1]

Originally Posted by aus

What was your drive off and payments? Any chance you got the money factor, residual and sale price?

Sale price $40,090
Drive off $5K
23 payments of $456
Residual $31,654