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      10-13-2012, 04:51 PM   #1
UAxDEATH(NYC)
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X6M pricing

Hey guys,

I'm thinking to pull the trigger on x6m

MSRP 105k

down 6.5k

monthly payment 1.2k

what u think ??
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      10-13-2012, 07:52 PM   #2
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UR paying way too much
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      10-13-2012, 09:36 PM   #3
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Quote:
Originally Posted by UAxDEATH(NYC)
Hey guys,

I'm thinking to pull the trigger on x6m

MSRP 105k

down 6.5k

monthly payment 1.2k

what u think ??
How many months? Any trade in? Overall I think it seems a pretty good deal.
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      10-13-2012, 10:05 PM   #4
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Originally Posted by MaxRulz View Post
How many months? Any trade in? Overall I think it seems a pretty good deal.
No trade ins, they are taking my current lease. thats it

standard 36 month
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      10-14-2012, 05:26 PM   #5
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Originally Posted by UAxDEATH(NYC) View Post
No trade ins, they are taking my current lease. thats it

standard 36 month
OK, what's your current lease duration left unconsumed? We assume your current lease is with BMW financial, right? What is the mileage limitation? What is the residual at the end of the term?

PS - Unless it is a company write off, why would ANYONE want to pay TWELVE HUNDRED DOLLARS A MONTH (e.g. 14,400/year)....essentially to RENT...anything?
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      10-15-2012, 08:52 AM   #6
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Don't lease, pay cash. If you can't pay cash, don't buy it.
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      10-15-2012, 04:12 PM   #7
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Don't lease, pay cash. If you can't pay cash, don't buy it.
There is a HUGE moat in between "paying cash for it" and leasing. Putting 30% down and financing the balance is a VERY GOOD option for most. Not everyone has an extra $100K just "lying around" that they can put into a X5M.

Let's look at this from a financial point of view. $100K has an intrinsic capability to generate a certain set return. Even though it is low, most of us can still get around 4% back on those dollars.

Dealers are offering 0.9% financing so if you simply take the loan and leave the cash in the bank, you are making 3.1% more on it than you would if you just "paid cash for it" so cash is not ALWAYS the best option.
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      10-15-2012, 08:36 PM   #8
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Wow, some scary comments in this thread. That said...
Leasing guarantees your upside. I could have "purchased" or "financed" my M5. Alas it would have been worth about $45k on trade at the end of 36 months. Instead it was valued at $62k. So had I purchased the car instead if renting it, I would have been $17k worse off.
Now granted, I don't have a crystal ball, but I do think gas prices will continue to rise, a new x6m will be out in 3 years, and M cars depreciate like a rock after 3 years. So I personally would consider leasing, even if it wasn't a company lease. Just my 2 cents.
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      10-16-2012, 07:07 PM   #9
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M series drops the value like nuts. That is why I don't want to buy it.
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      10-16-2012, 09:23 PM   #10
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M series drops the value like nuts. That is why I don't want to buy it.
...But it's such a joy
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      10-17-2012, 05:53 PM   #11
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...But it's such a joy
it is true, but I'm not sure if I wanted to keep if after 4 years bumper to bumper warranty will expire.
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      10-17-2012, 06:24 PM   #12
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If you don't pay cash then you have to borrow the money and pay interest regardless. I am totally against leasing, maybe its me. The only logical reason i can think of is that if you can't come up with a large down payment, and higher monthly payment then i would make sense in your situation. It is almost always leasing is going to cost more than conventional financing. thats why dealers and salesperson pushing for lease rather than purchase.
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      10-17-2012, 09:00 PM   #13
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Originally Posted by jspdr View Post
It is almost always leasing is going to cost more than conventional financing. thats why dealers and salesperson pushing for lease rather than purchase.
I think the MAIN reason people lease is because it LOOKS like it cost them less as EVERY lease has a lower monthly payment than it's equivalent purchase option. Many are driving cars that they simply could not afford to make purchase payments on but they feel they can make the $150/month lower priced lease. These are the same people that never bother to dig into the ACTUAL long term costs because they say that it "doesn't matter"...to them. The fact that they could have equity in their lease after the original term is often a foreign concept.

It's good to see that some here recognize that a lease could also "save them" from owning a quickly depreciating asset but those types of valuations usually only come into play on the much longer term loans (72-84 months). If someone is buying a car and paying for it over 48 months, they aren't going to be in the negative equity position that was outlined in the post above this one. Rather, someone who puts 15% down on a purchase is (almost) always going to have some equity in their vehicle....even an M-series

It IS true that dealerships and finance teams use these perceptions to prey on their customer's emotions (rather than logic & math). Also, interest rates are more visible and easier to calculate than lease money factors
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      10-18-2012, 11:48 AM   #14
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i like to lease because i treat my cars like rentals, like a new car at least every three years and live in the hail capital of the US. the most im out is my insurance deductible, a set of tires and my payment x term.
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      10-18-2012, 01:11 PM   #15
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Quote:
Originally Posted by ndabunka View Post
I think the MAIN reason people lease is because it LOOKS like it cost them less as EVERY lease has a lower monthly payment than it's equivalent purchase option. Many are driving cars that they simply could not afford to make purchase payments on but they feel they can make the $150/month lower priced lease. These are the same people that never bother to dig into the ACTUAL long term costs because they say that it "doesn't matter"...to them. The fact that they could have equity in their lease after the original term is often a foreign concept.

It's good to see that some here recognize that a lease could also "save them" from owning a quickly depreciating asset but those types of valuations usually only come into play on the much longer term loans (72-84 months). If someone is buying a car and paying for it over 48 months, they aren't going to be in the negative equity position that was outlined in the post above this one. Rather, someone who puts 15% down on a purchase is (almost) always going to have some equity in their vehicle....even an M-series

It IS true that dealerships and finance teams use these perceptions to prey on their customer's emotions (rather than logic & math). Also, interest rates are more visible and easier to calculate than lease money factors
You can't make a statement like that. Well you did, but still

As I pointed out, you don't know what the car will be worth at the end of the lease. Nobody does. But with lease, the leasing co is guaranteeing you an amount. In my case, it saved my butt and I saved a LOT more than had I purchased the car. That's a fact.

The other trick is that sometimes leases are subsidized. In that case they are making it more financially attractive to you.

So you may be against leases, but the fact is, it depends
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      10-18-2012, 02:30 PM   #16
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You can't make a statement like that. Well you did, but still So you may be against leases, but the fact is, it depends
Companies subsidize sales in any manner of ways so that aspect isn't really a reason to lease but I do agree with you... It depends on an individuals wants/needs and desires.

To lease or not to lease is on par with politics, religion and which is the better oil threads so rather than turning this into another one of THOSE threads, I will simply say that leasing IS a financial instrument (fact) and it was introduced as a way for the selling parties (and lease companies) to make money. If it was actually "cheaper to lease", leasing companies would not make money and would have gone out of business a LONG time ago.

Last edited by ndabunka; 10-18-2012 at 04:52 PM.
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      10-18-2012, 06:15 PM   #17
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Companies subsidize sales in any manner of ways so that aspect isn't really a reason to lease but I do agree with you... It depends on an individuals wants/needs and desires.

To lease or not to lease is on par with politics, religion and which is the better oil threads so rather than turning this into another one of THOSE threads, I will simply say that leasing IS a financial instrument (fact) and it was introduced as a way for the selling parties (and lease companies) to make money. If it was actually "cheaper to lease", leasing companies would not make money and would have gone out of business a LONG time ago.
Actually a lot of leasing companies have gone out of business (Chrysler for one) . Because it is a gamble - what will that car be worth in 24/36/48 months? BMW got crushed by this during the last recession. Case in point, the 24 month residual on the M5 when I leased was 72% and the cars were going for almost $10K off sticker! - remember residual is on the MSRP! - so you were getting the car for 10% off and then only had to pay the remaining 18% of the value over 2 years (plus the interest on the residual). Purchasing at even .9% interest was silly, just silly.

Alas, the cost of money (today it is a lot lower than it was 5 years ago), the cost of the car, how long you will keep it, and what it will be worth in 2,3, or 4 years, etc. all add up to the big question - should you lease or not. And it is different per car, per person, and dependent on a host of factors (economy, type of car, etc).. Either way, my belief, at least on high residual vehicles like BMWs, is that it still makes a lot of sense.
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      10-18-2012, 09:06 PM   #18
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[quote=doug_999;12857607] But with lease, the leasing co is guaranteeing you an amount. In my case, it saved my butt and I saved a LOT more than had I purchased the car. That's a fact.


According to your posts, it seemed to me you are very knowledgeable about this issue. Your logic here has not convinced me leasing will saved more than purchased. Reality is most of us really don't understand the complexity of the leasing formular, only the finance person who structured that particular transaction know exactly how much money they make out of you imo. Most people say they don't want to be responsible after 4 years on a depreciate access. Well, regardless whether we lease or purchase we pay for a depreciation anyway, it is in the lease formular. You said you saved a LOT more than had you purchased the car, compared to what, perhaps, between the purchase and lease figures, how do we know if the dealer don't inflated in the purchase figures to make it more attractive. We have to be inside the business to know leasing is not so attractive as most of us understand it, and have a full knowledge of leasing. My point is whether we have a predetermine residual set, it is expensive, nor the value drop like a rocket, leasing is going to cost all of us more than a purchase, period.

Last edited by jspdr; 10-19-2012 at 07:57 AM.
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      10-20-2012, 09:30 AM   #19
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According to your posts, it seemed to me you are very knowledgeable about this issue. Your logic here has not convinced me leasing will saved more than purchased. Reality is most of us really don't understand the complexity of the leasing formular, only the finance person who structured that particular transaction know exactly how much money they make out of you imo.
First off, leasing is pretty simple. You are doing two things
1. Paying off a loan balance equal to the amount financed minus the residual value of the vehicle.
2. Paying interest only on the residual (since you are never paying that back)

The lease contract is well documented and the dealer can't "trick" you any more than he/she could on a regular purchase. The MSRP is defined, the Selling Price is defined, the interest rate is defined, and finally the residual value is defined.

There are lease calculators out there that can help you do this, but there are a couple of caveats. 1) states like IL and TX require you to pay tax on the full "purchase price" of the car. So you either write them a check for that amount or roll it into your lease (remember it is on the full purchase price, not the lease payment).
2) there are some lease initiation and termination fees that the leasing company charges. I think it is $795 and $495 for BMW but I could be wrong. They tend to waive one or more if you re-lease.
3) Re-leasing a car through the same Financial company often will save you the sales tax (just like a trade in if you will).

Here is a quick simple sample
1. Car is $100,000 (MSRP)
2. Selling price is $90,000 (what they would sell it to you for)
3. Residual is 50% of the MSRP ($50,000)
4. Money factor is .00135 (this is your interest rate, multiply by 2,400 for the percentage = 3.24%)

You are borrowing (and paying off) $40,000 here which is your selling price minus the residual.
You are borrowing $50,000 but not paying off (this is the residual)

So take a loan calculator and run $40,000 over 3 years at 3.24%, then add in 3.24% per year on $50,000. You have your lease payment*

*plus tax title, lease inception fee, dealer fee, etc.

Note some dealers will mark up the money factor (just like they do on a loan). I use ridewithg.com to get the "base" money factor and negotiate from there.

So in summary
1. Leasing can be beneficial. You ultimately a) have to know how many miles you drive per year, b) take reasonable care of the vehicle, c) be willing to keep the car for the period. But remember, the main difference with a lease is you are guaranteed something. That can work FOR you or AGAINST you. Take my 1M, that has not depreciated much. Had I leased it, I would have wasted my money. Smart Money** says you purchase something like that.
2. ** The comments about "Smart Money" only buying cars and not financing them or leasing them is bunk. "Smart Money" does not buy a BMW, they buy a Toyota Camry or Honda Accord and they keep it for 10 years.
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      10-20-2012, 09:02 PM   #20
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Originally Posted by doug_999 View Post
First off, leasing is pretty simple. You are doing two things
1. Paying off a loan balance equal to the amount financed minus the residual value of the vehicle.
2. Paying interest only on the residual (since you are never paying that back)

The lease contract is well documented and the dealer can't "trick" you any more than he/she could on a regular purchase. The MSRP is defined, the Selling Price is defined, the interest rate is defined, and finally the residual value is defined.

There are lease calculators out there that can help you do this, but there are a couple of caveats. 1) states like IL and TX require you to pay tax on the full "purchase price" of the car. So you either write them a check for that amount or roll it into your lease (remember it is on the full purchase price, not the lease payment).
2) there are some lease initiation and termination fees that the leasing company charges. I think it is $795 and $495 for BMW but I could be wrong. They tend to waive one or more if you re-lease.
3) Re-leasing a car through the same Financial company often will save you the sales tax (just like a trade in if you will).

Here is a quick simple sample
1. Car is $100,000 (MSRP)
2. Selling price is $90,000 (what they would sell it to you for)
3. Residual is 50% of the MSRP ($50,000)
4. Money factor is .00135 (this is your interest rate, multiply by 2,400 for the percentage = 3.24%)

You are borrowing (and paying off) $40,000 here which is your selling price minus the residual.
You are borrowing $50,000 but not paying off (this is the residual)

So take a loan calculator and run $40,000 over 3 years at 3.24%, then add in 3.24% per year on $50,000. You have your lease payment*

*plus tax title, lease inception fee, dealer fee, etc.

Note some dealers will mark up the money factor (just like they do on a loan). I use ridewithg.com to get the "base" money factor and negotiate from there.

So in summary
1. Leasing can be beneficial. You ultimately a) have to know how many miles you drive per year, b) take reasonable care of the vehicle, c) be willing to keep the car for the period. But remember, the main difference with a lease is you are guaranteed something. That can work FOR you or AGAINST you. Take my 1M, that has not depreciated much. Had I leased it, I would have wasted my money. Smart Money** says you purchase something like that.
2. ** The comments about "Smart Money" only buying cars and not financing them or leasing them is bunk. "Smart Money" does not buy a BMW, they buy a Toyota Camry or Honda Accord and they keep it for 10 years.
Your scenario is just to demonstrate how leases worked. Let simplify your numbers, and back up your claim that leasing saved more money than purchase.

Let say i'm in the market for a purchase financing, and let base on your figures.
Selling price 90,000
Down payment 10,000
Interest @ 3.24
Term 60
Lease:
Cap cost 90,000
Money factor .00135
Term 36
Mileage 12,000
Residual 50,000
I'm using same interest rates so we can compare apple to apple here. Explain how i can financially benifit from leasing/purchasing.
Leases are designed to custom tailor fit for the individual wants and needs, without long term commitment, not financial gain for consumer.

P.S Ask Suze Orman if anyone should lease any vehicle? She will say this to you, "Are you nuts?"
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      10-20-2012, 10:23 PM   #21
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P.S Ask Suze Orman if anyone should lease any vehicle? She will say this to you, "Are you nuts?"
Ask Suze Orman if you should purchase a $100,000 car. Dare ya.

Wait, ask her if you should purchase a $50,000 car. Triple dog dare ya.

In short, you don't get it. You can't compare a 5 year loan with any lease.
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      10-20-2012, 11:24 PM   #22
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THIS THREAD ROCKS
ITS REALLY INFORMATIONAL!
ALOT OF GREAT STUFF SAID

THE TRUTH IS 100K IS A TON OF MONEY

THERE IS A FAIR AMOUNT OF FOLKS THAT GET IN THESE VEHICLES AND CANT THEORETICALLY AFFORD THEM!

BUT THEY MANAGE, THEY DO WHAT THEY NEED TO DO.

I JUST HOPE THEY KEEP THERE JOBS OR THEN WE HAVE A PROBLEM
UPSIDE DOWN CITY
AND WE ALL KNOW THAT IS A CRAPPY PLACE TO LAND

GOOD LUCK IF U DECIDE ON THE X6M
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