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      09-09-2008, 11:26 AM   #1
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Question Lease Into Finance?

Hi guys and gals,

Quick financial question for ya:

So I love my new 1'er, and have no desire to part with it any time soon. I kinda got hosed on my monthly lease payments though (i had some credit tied up at the time that affected my score, and I was a little bit upside down on my trade-in). Anyway, the long and short of it is, as I'm looking at the situation right now, I'm realizing that I love this car far more than I ever expected to, and I'd just as soon buy it (finance it) straight up right now if it's an option for me.

Can anyone tell me if BMW Financial would allow me to turn my lease into a finance? I've leased the car for a month and a half now, so at this point I've made two lease payments so far. I'm thinking that by doing this, I might be able cut my monthly payments somewhat (if i finance over a long period), and maybe not have to worry about the lease anymore at all.

If this doesn't make a lot of practical sense to some folks, that's totally fine, but please try to focus your answer on the potential financial benefits.

Thoughts? Thanks in advance...
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      09-09-2008, 12:21 PM   #2
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You can find what the payoff amount is for the lease (call BMWFS or login to your account) and use that to calculate what your payments will be if you finance. Shop around as you're not limited to BMWFS.

Edit: The only real "disavantage" is that you already paid the lease acquisition fee for a lease that you'd keep only for a couple of months. Recent leases were at ~6.5% interest, can you get a better rate than that?
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      09-09-2008, 12:40 PM   #3
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spacegray, will BMW Financial allow me to perform a transfer of this nature if I don't go through them directly? What incentive would they have? Also, stupid question, but will my payoff now be different than my payoff would have been when I first leased the car? Another way of asking that would be, since my payments right now are really nothing more than a monthly rental stipend to BMW, have I actually done anything to reduce my overall payoff number, or will it be as high as it would have been had I financed the car initially?

Also, will I get hit with early termination fees just for transferring my method of payment? Thanks!
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      09-09-2008, 12:58 PM   #4
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my 2 cents
if you plan to keep the car, and you can get a fair rate you are much better off finacing the vehicle.
Yes, Bmw will allow you to pay off your lease, which means you buy the car. Call them ask for a payoff. this is the amount you will need to finance.
no there are not any fees for paying off the lease.
yes you can re finance with BMW , but probably wont get any special financing deals if they are offereing them. The rate will be tiered based on your credit.
you can also go to your bank or capital one or whatever and get a loan through them for the pay off amount and pay off the car.
probably get a better rate.

basically you are buying the car from BMW for the purchase price you paid, minus the principal protion of the paymenst you made.
hope this helps.
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      09-09-2008, 01:05 PM   #5
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I think you can pretty much figure your payoff buy adding up the remaining lease payments then adding the residual value. Someone please correct me if I am wrong because I have only leased one car a long time ago.
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      09-09-2008, 01:07 PM   #6
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BMWFS already made money off you with the lease acq fee. And they probably continue to make money on the spread between what they pay to borrow the money and what they charge us.

The payoff amount does go down with each payment.
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      09-09-2008, 01:08 PM   #7
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Buschy, so my payments thus far HAVE made some small dent in my payoff number? Also, do you anticipate this being a difficult process for me given that I only just recently signed the lease? I would have thought BMW would have given me more of a hassle for switching financing options. No?
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      09-09-2008, 01:38 PM   #8
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If you've made ONE lease payment so far, no, you havent made a dent in the payoff.
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      09-09-2008, 02:47 PM   #9
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OK, I'm thinking about doing this... but I still have a LOT left to finance. I'm not concerned about the number of years, I've been down that road before, no big deal.

I DO want the monthly payments to be more palatable, however, so can anyone recommend some good banks for me to call? I think that I'm going to need to be going about this creatively, because most of the mainstream big boys probably won't finance me for this much car over that many years. Thoughts?

Thanks again!
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      09-09-2008, 02:52 PM   #10
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Give PenFed a try, see what they have available.
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      09-09-2008, 03:02 PM   #11
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Great, thanks for the suggestion! Any others? And I assume everyone is in agreement that BMW Financial will tolerate me financing through a third party bank in this situation? Yes?
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      09-09-2008, 03:11 PM   #12
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yes you made a dent albeit a small one. Depending on your payments now and term on the lease.
your dent is probably a couple hundred dollars.
no BMW will not have a problem with you doing this at all. you already have given them some money and wether you refinance it with them or without , they are still selling a car and making money off you.
you cannot add up your payments and add the residual that will not be the right number.
you have to call bmw or sign up online to get a "payoff Quote".
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      09-09-2008, 03:20 PM   #13
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Thanks. I did get the payoff quote. I'm just looking for good, open minded-banks now.
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      09-09-2008, 03:26 PM   #14
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pend fed is good.
if you were or are military, USAA is good.
capital one usually offers good loans.
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      09-09-2008, 03:30 PM   #15
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Will my odds of being approved for a good loan be trashed by the fact that banks will see that I've already leased the vehicle and possibly assume that I'm trying to take out a loan for yet ANOTHER vehicle? Do I need to explicitly explain the situation, or should I just hope for the best?
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      09-09-2008, 10:22 PM   #16
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Have you checked into just trying to get someone to assume your lease and just starting over with a new 1? What was your lease payoff that you had quoted?
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      09-09-2008, 10:23 PM   #17
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i assumed my lease from someone else. they had it only 3 months. you eat all the down and costs, and you offer for someone to straight take over your payments. Then they go thru the whole BMW lease transfer approvals which take a good 3-4 weeks.
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      09-09-2008, 10:30 PM   #18
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I just wonder what the math would look like for the OP to just start over. His lease may not be attactive for someone to assume since he had negative equity rolled into it though.
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      09-10-2008, 07:20 AM   #19
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Quote:
Originally Posted by 1ForAllFor1 View Post
Will my odds of being approved for a good loan be trashed by the fact that banks will see that I've already leased the vehicle and possibly assume that I'm trying to take out a loan for yet ANOTHER vehicle? Do I need to explicitly explain the situation, or should I just hope for the best?
NO, But you have to apply for a RE-finance loan, its a particular loan that refinances the car you have. as long as the payoff is withing limits you should not have a problem getting it. theybank will see that you already pay your loan good, and lowering the payment will only be better. however all the regualar credit qualifications will still apply.
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      09-10-2008, 09:27 AM   #20
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tkbr0wn, an interesting idea, but not something that I would ever consider. I love my car, and it's practically brand new... I have no desire to go through the ordeal of getting rid of it and starting over again. If there were some problem with the 1, or if I was finding myself disappointed in some way, then sure, maybe what you suggest would be a viable option -- but the reality is actually just the opposite: I've fallen much harder for the car than I ever expected to.

That being said, I'd just as soon finance the thing and lock myself in. Payments will potentially be cheaper, and I could rest assured at night that my baby will be with me for a good long while. Anyway, thanks for the advice though, and if anyone else has other thoughts to contribute, please fire away!

For those interested, I'll try to provide an update after calling around to some banks.
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      09-10-2008, 09:32 AM   #21
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Another question... is PenFed only military? Because I'm not.
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      09-10-2008, 03:48 PM   #22
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pen fed is for military, you have to have a familiy member or someone in the military.
also what is your lease payment, it seems you want a cheaper note, and financing is better, but not necesarily cheaper, at least monthly its not.
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