BMWFS Improves the MSD Program!

Originally Posted by pjo1966

It's 1 month's payment rounded up to the nearest $50.

Based on what the lease payment would be with the MSD discount applied?

Originally Posted by Interactive

Based on what the lease payment would be with the MSD discount applied?

Y

What happens when you're leasing a new vehicle after returning your previously leased BMW?.

1. The 1 required Security deposit gets waived for returnees I believe, but do you have the option of paying it for a total of 8 MSD's.
2. Is the MF drop for the first (optional/waived) SD the same as the drop per MSD deposit?
3. Where does the loyalty discount come in?

Thanks

Originally Posted by pfitzpa1

What happens when you're leasing a new vehicle after returning your previously leased BMW?.

1. The 1 required Security deposit gets waived for returnees I believe, but do you have the option of paying it for a total of 8 MSD's.
2. Is the MF drop for the first (optional/waived) SD the same as the drop per MSD deposit?
3. Where does the loyalty discount come in?

Thanks

1. No, you can only pay up to 7 MSDs .00007 x 7 = .00049
2. SDs are required on ALL BMW FS leases unless, (A.) customer qualifies for BMW FS OLP in which case it is waived, or (B.) customer does not qualify for SD waiver but decides to waive paying SD upfront, then in which it will be Buy rate + .00015(SD).
3. Answered in 2.

Originally Posted by JW_BMW

1. No, you can only pay up to 7 MSDs .00007 x 7 = .00049
2. SDs are required on ALL BMW FS leases unless, (A.) customer qualifies for BMW FS OLP in which case it is waived, or (B.) customer does not qualify for SD waiver but decides to waive paying SD upfront, then in which it will be Buy rate + .00015(SD).
3. Answered in 2.

Thanks for the quick and concise answers!!

One other thing, the confidential wholesale prices on the sticky for a 335i sedan are..

MSRP:
US Port : 38,700
Munich : 35,990

INVOICE:
US Port : 35,665
Munich : 33,110

2 questions actually, (technically not MSD related but an answer would be welcome)

1. For lease calculation purposes the MSRP will be the MSRP-US Port(38,700) and my cap cost will be INVOICE-Munich(33,110) plus dealer profit.
2. Does destination fee get added to MSRP/capcost for purpose of lease calculation, i.e is the residual value going to be 61% of (MSRP+Destination)


Thanks

Originally Posted by pfitzpa1

Thanks for the quick and concise answers!!

One other thing, the confidential wholesale prices on the sticky for a 335i sedan are..

MSRP:
US Port : 38,700
Munich : 35,990

INVOICE:
US Port : 35,665
Munich : 33,110

2 questions actually, (technically not MSD related but an answer would be welcome)

1. For lease calculation purposes the MSRP will be the MSRP-US Port(38,700) and my cap cost will be INVOICE-Munich(33,110) plus dealer profit.
2. Does destination fee get added to MSRP/capcost for purpose of lease calculation, i.e is the residual value going to be 61% of (MSRP+Destination)


Thanks

1. Destination is part of the MSRP and invoice so it will be caculated into the lease.

Only part not included for an ED is MACO and training fee in the invoices.

Great thread!

Read almost all of it and now know to look for 7 MSDs (+1 for new BMWFS lease customer) @ 0.00007 each, but only at NJ or CT dealers

Great thread. I am fully armed for negotiations.

Thanks.

OK. After reading this entire thread, I think I've boiled it all down to this:

•The multiple security deposit (MSD) program would allow you to buy down the money factor rate by .00007 per additional deposit. The maximum allowed is 7 additional security deposits, for a total reduction of .00049 on the money factor. A customer can do as few as 1 additional security deposit to a maximum of 7 additional security deposits in the MSD program.

•The security deposit equals your total monthly payment (including tax) rounded up to the next $50 increment. Thus, if the total car payment per month is $576, your security deposit would be $600. If you made 7 MSDs, you would have to pony up $4,200 in security-deposit money when you sign the lease.

•MSDs are fully refundable at the end of the lease – minus excess wear and tear, and mileage overages (if any).

•Gap insurance is included with all BMW Financial Services (BMWFS) leases.

•In the event that your car was totaled in an accident, your MSDs would be fully refundable (since GAP insurance would cover any shortfall in the amount owed).

•In New York there is a security deposit cap of $749, which would not allow you to avail yourself of the MSD program in a meaningful way. People get around this by going to neighboring states to do the deal.

•Sometimes dealerships will try and talk you out of doing MSDs. Most of them don't understand math, so they don't see the advantage of reducing the money factor (even though it seems obvious that reducing the money factor will reduce the amount of interest you'll pay over the life of the lease).

•Some dealerships, meanwhile, will act as though they've never heard of the MSD program. If your dealership won't accept your MSDs, then find a dealer that will.

•The absolute lowest money factor that a customer can get is .00005, which translates into an interest rate of roughly 1/8 of 1% (almost nil).

•If you are a first-time BMWFS lease customer you will be required to put down a security deposit. (If you're taking advantage of the MSD program, you would put down a total of 8 security deposits in this scenario.)

•First-time BMWFS lease customers can get the security deposit eliminated, but those customers will be assessed an extra .00015 on the money factor.

•If you are a current BMWFS customer (not a lease customer), the security deposit on your new lease is waived. No .00015 money factor increase is applied.

•BMW dealers can mark up the money factor buy rate (best published rate) by .00040 – and by as much as .00055 if you don't put down a deposit as a first-time BMWFS lease customer.

•The disposition fee ($350) is waived (on the next leased vehicle) if you lease another BMW not more than 6 months after your previous lease ends.

•Finally, never put a down payment (cap cost reduction) on a lease. In the event of a total loss of the vehicle, you won't recoup that down payment.

Great executive summary!

Originally Posted by travel4B

Great executive summary!

Thanks. I figured it would be a lot easier if everything was located in one post. Couldn't have done it without all of the great members of this forum, though.

Great information in this thread.

Originally Posted by MarcusSanDiego

The security deposit equals your total monthly payment (including tax) rounded up to the next $50 increment. Thus, if the total car payment per month is $576, your security deposit would be $600. If you made 7 MSDs, you would have to pony up $4,200 in security-deposit money when you sign the lease.

You may wish to clarify that if the without-MSD lease payment is $576 and the post-MSD payment is $549, then the 7 MSD's would total $3,850 (7x$550). In other words, use the MSD-reduced interest rate to determine your monthly payment. Then, round up that payment to the nearest $50 to find the amount of one SD.

Originally Posted by djlfp

You may wish to clarify that if the without-MSD lease payment is $576 and the post-MSD payment is $549, then the 7 MSD's would total $3,850 (7x$550). In other words, use the MSD-reduced interest rate to determine your monthly payment. Then, round up that payment to the nearest $50 to find the amount of one SD.

My example assumed that the MSDs had brought the payment down to $576. But for clarification's sake, your point is duly noted.

Ok, I have read that the minimum MF is .00196 but here is says the minimum is .00005 Which is the case, or am I missing something?

Originally Posted by Gremlin

Ok, I have read that the minimum MF is .00196 but here is says the minimum is .00005 Which is the case, or am I missing something?

I think the .00005 that you are referring to is the lowest MF that anyone can theoretically get. Clearly, most MFs are nowhere near .00005 -- as evidenced by the .00196 that you are seeing for your vehicle.

Right, but theoretically I can get mine down to .00184 for ED, I was really just wondering if that is below some preset threshold. If that is .00005 then I am all good.

What a great thing this forum is!

I am about to lease a new 328xi, and my dealer happily accepted the 7 MSD's to lower the MF. That's all good.

But, I leased an X3 2 months ago (before I knew about the MSD program.) UGH.

Is there a way to add MSD's to an existing lease?

(Why don't the dealers let you knopw about this option -- do they lose money on it?)

Newbie question...
Thanks for this excellent information. I just put down my drive-off cost on a 2008 335 ci. i have not signed any lease agreement yet because the car is special order from Germany.

I have not talked to the dealer about MSDs. The question is, when do I bring up the MSD, should I do it now or when I sign the lease? What if the dealer claims that he does not know what MSD is? Can I talk to someone from BMWFS?

Thanks,
Mailskobe

Originally Posted by mailskobe

i have not signed any lease agreement yet because the car is special order

It doesn't matter that it's an order, you can structure the deal and they can lock in the rate. Money factors are going up and residuals are coming down, so you want to lock in now. If it goes the other direction you can take advantage of that change (after the fact) but if you're not locked in, it's not retroactive to when you ordred your car.

Thanks for the info.

My deal is locked in as on May 31st. My original money factor was 0.00275.
Actually here are the details of my deal:
MSRP: 47685
335ci + sports + premium + ipod + sunshade + comf access
Cap Cost (negotiated rate): 44700
Residual: 54% = 26698
Term: 36
Original MF: 0.00275
Original Monthly payment (with tax)= 755.14

Negotiated MF after 8 MSDs: ~0.0018
New monthly payment: ~ 682
MSD value: (800 + 7*700 = 5700)
Acquisition fee: 825


is this a good deal?
mailskobe

Mailskobe - I don't see how your MSRP on your 335ci makes sense. The price on the website shows an MSRP around $55k versus your $48.5k. The details of the lease would only make sense with the right pricing.

Originally Posted by beemer328i

Mailskobe - I don't see how your MSRP on your 335ci makes sense. The price on the website shows an MSRP around $55k versus your $48.5k. The details of the lease would only make sense with the right pricing.

55K, I am talking about a 335 not a 5... here are the prices from BMWUSA

335i Coupe
Base MSRP $41,200
Space Gray Metallic $550
Black Dakota Leather $0
Light Poplar Natural wood trim $0
Premium Package $2,650
Sport Package $1,200
Comfort Access system $500
Power rear sunshade $350
iPod® Interface Adapter $320
Destination & Handling: $825
Total MSRP as Built $47,595

mail

Sorry for the misunderstanding. I thought you were pricing a convertible.

In light of today's banking environment, has anyone had concerns on the security of doing MSD's? If BMWFS ran into trouble, what level of creditor would the owner of an MSD be?

I would think one could hold the leased car for security???? or if leasing another and the MSDs weren't returned, could perhaps apply the value towards lease payments? (worst case scenario, I mean)