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  #1  
Old 02-24-2006, 06:36 PM
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SARAFIL SARAFIL is offline
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BMWFS Improves the MSD Program!

In a bulletin released today, BMWFS made some changes to the MSD (multiple security deposit) program.

The current program is up to 5 over the required amount, and a 0.00005 reduction in the money factor for each one.

The new program is up to 7 over the required amount, and a reduction of 0.0007 per.
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  #2  
Old 02-24-2006, 10:02 PM
jayrod jayrod is offline
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Really, that's great! Can anyone else confirm?


Not that I don't trust you Sarafil
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  #3  
Old 02-24-2006, 11:05 PM
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schley schley is offline
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Quote:
Originally Posted by SARAFIL
In a bulletin released today, BMWFS made some changes to the MSD (multiple security deposit) program.

The current program is up to 5 over the required amount, and a 0.00005 reduction in the money factor for each one.

The new program is up to 7 over the required amount, and a reduction of 0.0007 per.

do you mean .00007?
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  #4  
Old 02-25-2006, 12:27 AM
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Ågent99 Ågent99 is offline
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All these decimal places in the MF is so stupid...they really need a new way to represent this number....

Also, could someone explain how these MSDs work?
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Last edited by Ågent99; 02-25-2006 at 12:37 AM.
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  #5  
Old 02-25-2006, 04:17 AM
DoubleL DoubleL is offline
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Wow that is a great return on investment. I worked 7 additional SD's into the current deal I am trying to work and for a $4900 investment ($700 * 7) it reduces my payment by $39.40 per month.

Over my 24 month lease that's a total savings of $945.60 (on a $4,900 investment) or 19.3% for the two years.

That's a darn good two year after tax total return you would be hard pressed to match in Wall Street.
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  #6  
Old 02-25-2006, 09:12 PM
BayAreaBMWFan BayAreaBMWFan is offline
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SARAFIL:
I am locked on the December program and will be signing my papers on Monday.
Can is I use the 0.0007 negative adder on the old rates too or is it only for new lock ins?
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  #7  
Old 02-25-2006, 09:28 PM
AEC AEC is offline
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I have a related question:

If a leased car is totalled or stolen, is the security deposit refunded to me or is it applied to the "gap" between the actual cash value (paid by my insurance) and the money owed to BMWFS?

I'd probably walk away from the MSD program if there was a chance I'd lose that money if the car was written off. Has this happened to anyone?
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  #8  
Old 02-26-2006, 06:52 PM
carnuts3 carnuts3 is offline
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Quote:
Originally Posted by DoubleL
Wow that is a great return on investment. I worked 7 additional SD's into the current deal I am trying to work and for a $4900 investment ($700 * 7) it reduces my payment by $39.40 per month.

Over my 24 month lease that's a total savings of $945.60 (on a $4,900 investment) or 19.3% for the two years.

That's a darn good two year after tax total return you would be hard pressed to match in Wall Street.
Not quite. By foregoing the compound interest earned on you $4900 deposit over 2 years, say at 5% per year(or $502.25), your total savings over this period is actually closer to $443.35, or 9% over the lease term. Still good though.
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  #9  
Old 02-26-2006, 10:23 PM
DavidNY DavidNY is offline
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Quote:
Originally Posted by carnuts3
Not quite. By foregoing the compound interest earned on you $4900 deposit over 2 years, say at 5% per year(or $502.25), your total savings over this period is actually closer to $443.35, or 9% over the lease term. Still good though.
I was trying to figure out why the return seemed so high -good work.
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  #10  
Old 02-26-2006, 06:53 AM
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SARAFIL SARAFIL is offline
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Quote:
Originally Posted by Ågent99
All these decimal places in the MF is so stupid...they really need a new way to represent this number....

Also, could someone explain how these MSDs work?
Your normal security deposit is your monthly payment rounded to the next $50. So, $300 payment = $300 deposit, $302 payment = $350 deposit, $350 payment = $350 deposit, etc.

You are required to pay one deposit at lease signing unless a) you are a current BMWFS customer, or b) you increase the money factor to waive it. You don't get a reduction in the MF for this one required deposit.

In addition to that required one, you can now put down up to 7 additional ones, and you get a decrease of 0.00007 to the MF for each one. So, on a buy rate of 0.0025, you can put down 7 deposits extra and get your new MF to 0.00201.

At the end of the lease, this is fully refundable. They will only keep part of it if you have excess wear charges, mileage penalties, etc. (which they would bill you for regardless of your security deposits, so you'd pay it anyways even if you didn't do MSD.)

If you have a little bit of cash on hand, it's a great investment opportunity. As some have calculated, you can get a very high return (monthly payment savings over the term) on your investment.
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  #11  
Old 10-19-2006, 01:00 AM
pciguy pciguy is offline
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is the SD calculated based on the payment amount + tax or just the payment amount?

Thanks,
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  #12  
Old 10-19-2006, 09:21 AM
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Quote:
Originally Posted by pciguy View Post
is the SD calculated based on the payment amount + tax or just the payment amount?

Thanks,
Total payment including tax rounded to the next $50 increment.
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  #13  
Old 02-26-2006, 06:46 AM
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SARAFIL SARAFIL is offline
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Quote:
Originally Posted by schley
do you mean .00007?
Oops... yes, 0.00007.
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  #14  
Old 03-04-2006, 12:25 PM
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chicagolab chicagolab is offline
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MSD for Owner's Choice???

I live in Illinois and am wondering if MSD to bring down the money factor is available for the Owners Choice(lease style)program or just with traditional leases?
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  #15  
Old 03-04-2006, 07:46 PM
compwhiz compwhiz is offline
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No. MSD applies to leases only.
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  #16  
Old 03-07-2006, 08:35 AM
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brkf brkf is offline
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My sales guy tried to talk me out of the 7 msds yesterday...lol. "They really don't make much of a difference." Really? I see a $37 a month savings. That's a nice chunk of dough over 24 months.

Weird thing is, I did 10 MSDs with the same salesguy 3 years ago. At that time he tried to talk me out of it too.
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  #17  
Old 03-07-2006, 08:39 AM
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Quote:
Originally Posted by blueguydotcom
My sales guy tried to talk me out of the 7 msds yesterday...lol. "They really don't make much of a difference." Really? I see a $37 a month savings. That's a nice chunk of dough over 24 months.

Weird thing is, I did 10 MSDs with the same salesguy 3 years ago. At that time he tried to talk me out of it too.
Probably because like most BMW salespeople he doesn't understand them...
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  #18  
Old 03-12-2006, 12:24 AM
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Quote:
Originally Posted by greginaz1
Probably because like most BMW salespeople he doesn't understand them...
I was told today that if I had insisted on the 7 MSDs, then the dealership would have to change my MF of 0.00245 (ED extra of 0.0003 and dealer markup of 0.0002) to something higher. Am I missing something? Can they really do that? The MSD program is through BMWFS, not the dealership. How can they change my agreed upon MF if I choose to use MSDs?

Confused...
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  #19  
Old 03-12-2006, 12:49 PM
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schley schley is offline
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Quote:
Originally Posted by blueguydotcom
I was told today that if I had insisted on the 7 MSDs, then the dealership would have to change my MF of 0.00245 (ED extra of 0.0003 and dealer markup of 0.0002) to something higher. Am I missing something? Can they really do that? The MSD program is through BMWFS, not the dealership. How can they change my agreed upon MF if I choose to use MSDs?

Confused...

wow... I'm curious about that answer as well, it would be another let down if we find out that you are being deceived by a dealer.
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  #20  
Old 03-12-2006, 12:51 PM
twodachs twodachs is offline
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Does the MSD's then affect only the "rental" portion of the lease calculation and not the "depreciation" portion? I'm assuming the MSD dollar amount for the MF buy down is paid with a separate check to BMW Financial (ex. $4200 ... for a 7 SD buydown of .00049 on a previously calcuated lease of $594.00).
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  #21  
Old 03-12-2006, 12:55 PM
bennett64 bennett64 is offline
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My SA said New York doesn't allow multiple security deposits. True?
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  #22  
Old 03-12-2006, 01:12 PM
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Called another dealer and asked...same run-around: nobody uses those, bmw doesn't want people to use them, they don't make much difference, it's a waste of your money. WTF?

I'm not a math expert, BUT if 7 MSDS will drop an MF 0.00049 and you can see a $700-900 savings for 3 grand down over two years, that seems like a big difference and a great ROI.

Weirdest thing, I heard about MSDs from a Beverly Hills dealership in 03. That guy got my email about a possible 330i purchase and turned me on to MSDs and leasing. Ever since all other dealers/salesguys get ansty when I mention them.
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  #23  
Old 03-12-2006, 01:21 PM
x3Bruin x3Bruin is offline
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Quote:
Originally Posted by blueguydotcom
I'm not a math expert, BUT if 7 MSDS will drop an MF 0.00049 and you can see a $700-900 savings for 3 grand down over two years, that seems like a big difference and a great ROI.
It about 9.5% per year ROI - but tax free so is effectively about 12-13% return per year.

I think the F&I guys find it a hassle to enter the extra data into the form.
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  #24  
Old 03-13-2006, 07:18 PM
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can this be applied for ED and NY licenses....
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  #25  
Old 03-14-2006, 01:47 PM
piku piku is offline
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I have a question.

Let's say my monthly payment before MSD was $463 and after MSD is applied it goes down to $438. Will the security deposits be, $500 or $450 each?

.
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