BMWFS Improves the MSD Program!

Originally Posted by PhilT3

holy crap... this is a lot of math! I would have to devote a substantial amount of time to this to really understand it.

Kudos to you all who do!

Can someone tell me if this deal "looks" okay?

I placed an order last week with a dealer to start production on an X5. Leasing.

But my gut tells me I could have gotten a better deal. I went with my wife. She is not a negotiator and just wants me to get what I want.

So, we paid them the whole down payment as the deposit to start the order.

As built = $62,745.
10k miles / year
$810 / month (includes 9% PA tax)
$3200 out of pocket

Info on my trade in:
2010 Jeep SRT8, 13k miles. 9 out of 10 condition. I owe $34,400 on it. (At first offer the CA had them giving me $36 on the paper. In talking with a neighbor in the business, I expected around $38k)

So I really don't know how much they are giving me for my trade. I negotiated from the per month and down payment.

Does this deal look alright with the info I provided?

Should I stop payment on the check and shop?

I don't know how I feel about doing that as I "made a deal" and shook the salesman hand. I am in sales myself and sell value... so would not appreciate one of my customer's pulling a deal after we agreed.

Thanks for your input.

Brother, my recommendation to you is that if you don't know what's in the deal then stop. Stop until you understand where your money is going. $38,000 for your used car isn't pocket change, where did it go?

Stop until you know exactly how a lease works. If you can't define Cap Cost, Cap Cost Reduction, Money Factor, Residual, Depreciation, Lease Origination Fee, rate lock, etc., you really need to stop and do a bit of study. It sounds hard but it really isn't, the language is just a bit arcane. Leases are great, I've done many of them but many people don't have a clue how they work. Do a search on Bimmerfest, there's a ton of information that'll pay gold in the end!

Also, not trying to criticise you but you started this deal completely backwards. You never, ever negotiate from a monthly payment. Always find out the MSRP, Invoice and sales record of the car first so you can figure out what type of sales price you should be shooting for. (Also, negotiate the price of the new car first and get that set, only then worry about your trade in). Then check on what sort of incentives are available and how the incentives work. For instance, some are basically cash directly to the buyer while others go to the dealer. If it comes to you, you can use it however you want, cap cost reduction or fees for instance and makes no difference in how much profit the dealer makes. Dealer incentives do the opposite. They apply as discounts to the price of the vehicle or are even hidden. These affect the dealer's profit and should enter into your calculations. There are also the "tricks of the trade" such as the MSD program and, like someone else mentioned, paying a bit of a CCR to reduce the total MSD $$$. These can have a big impact on your monthly payments.

Once you've gotten that information you're only half way there. There are many ways that CAs can do mischief in a lease. Say you tell him you're only willing to spend say, $810 per month. You just gave him a license to jack up the money factor, fees, and yes, even the price of the car to give you an $810 per month payment when you could have gotten the car for much less per month. Give him a monthly payment and you're virtually guaranteeing that you'll pay at least that amount. I'm not saying your guy did this but I can't tell from the information you've provided and you can't either.

That's why I say stop and figure it all out. If the CA is honest (and most are) he'll be more than willing to hold up the order until you're satisfied (and, BTW, deposits are fully refundable in most states so you're not stuck and can walk away). If a CA did not take the time to explain the whole deal to you then he has no right to expect you to go through with it even if you did make a deposit and shook hands.

If you can give us the MSRP, Invoice, and rest of the information I listed above, we can give you an idea about whether or not your deal is reasonable but that's not possible from the information you've provided.

necro-bump!

if my payment is $498 before tax will my MSD be 500 or 550 each? Thanks a milion!

EDIT: i think i found the answer, its based off payment WITH tax. Correct me if im wrong. Otherwise you can go back to sleep everyone

Originally Posted by MSportyF30

necro-bump!

if my payment is $498 before tax will my MSD be 500 or 550 each? Thanks a milion!

EDIT: i think i found the answer, its based off payment WITH tax. Correct me if im wrong. Otherwise you can go back to sleep everyone

Based on payment with tax.

It is my understanding that you have to leave 1 month security deposit for a lease. If you go the 7 MSD route to lower your money factor, does that include the mandatory 1, or do you end up leaving 8? Regardless if you leave 1 or 8, you receive it back at the end of the lease, correct?

Originally Posted by dzaborn

It is my understanding that you have to leave 1 month security deposit for a lease. If you go the 7 MSD route to lower your money factor, does that include the mandatory 1, or do you end up leaving 8? Regardless if you leave 1 or 8, you receive it back at the end of the lease, correct?

It's 1 (if required) plus up to 7 additional for MF reduction. All get returned.

Originally Posted by SARAFIL

It's 1 (if required) plus up to 7 additional for MF reduction. All get returned.

thanks SARAFIL

I might be pulling ahead on my E93 lease, and dealer tells me if I want to do 7 MSD's again, I cannot apply the MSD's from last lease, I have to front more $, and I'll eventually be refunded my MSD's from FS on the prior lease. Can anyone confirm if this is true?

Thanks,
Joel

yup. this is the way its been done with my past msd leases with bmw, benz & lexus

I pulled my paperwork and noticed the check I wrote for MSD's was to the dealer, not BMWFS, but FS will be the one to refund the $$? Any idea how long it takes?
Thanks,
Joel

great thread

I have a question about calculating the multiple security deposit amount. I am planning to put 7 MSDs towards my lease. When you round to the closet $50 to determine how much one MSD is, do you reflect the reduction in rate for the MSD or is it pre-MSD?

Originally Posted by 528iDC

I have a question about calculating the multiple security deposit amount. I am planning to put 7 MSDs towards my lease. When you round to the closet $50 to determine how much one MSD is, do you reflect the reduction in rate for the MSD or is it pre-MSD?

Mine was calculated by dealer after the 7 MSDs.

Thanks rofin82 - I've had same experience with prior leases (i.e., calculated after 7 MSDs) but new dealer says it is calculated prior to MSDs. Can any dealers help confirm what BMW FS rules say?

Originally Posted by 528iDC

Thanks rofin82 - I've had same experience with prior leases (i.e., calculated after 7 MSDs) but new dealer says it is calculated prior to MSDs. Can any dealers help confirm what BMW FS rules say?

It is always rounded up. It is based on the payment after MSD reduction.

Originally Posted by 528iDC

Thanks rofin82 - I've had same experience with prior leases (i.e., calculated after 7 MSDs) but new dealer says it is calculated prior to MSDs. Can any dealers help confirm what BMW FS rules say?

you apply the rate reduction first, then calculate the new payment with sales tax, and round up to the next $50.

does the .0007 still hold true today?

Originally Posted by Ptp36mia

does the .0007 still hold true today?

yes

Great, thanks.

About to order same car you have - 2013 535i M sport, Carbon or Jet /Cinnamon, Technology, Premium Hi Fi

When trading in the vehicle at end of lease as opposed to a return, does the lessee still get the MSD refunded from BMWFS or does it transfer to the purchaser?

Originally Posted by Clepto

When trading in the vehicle at end of lease as opposed to a return, does the lessee still get the MSD refunded from BMWFS or does it transfer to the purchaser?

I would assume it would go to the original party and they could do with it what they want?

The reason I ask is that if someone takes over a lease from the original lessee the taker over gets any MSDs... Better safe than out $3500 (;


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