End of Lease Purchase Question

My lease on my '08 535 is up in July. I recently test drove the F10 535 and did not have the excitement towards the car as I had hoped. I have realized that I like the feel and ride of my E60 and am most likely going to purchase at the end of the lease. When talking to BMWFS, they were able to give me payoff and loan payments if I buy before the end of the lease. Asking about waiting till the end of the lease, besides making statements about CPO and lower loan rates that the dealer could offer, the rep made a comment that if I wait, the dealer is able to buy the car at some amount different than the residual during the process of selling it to me. The down side on the residual is that I had locked in the higher residual percentage in early '08 before BMWFS adjusted downward.

So my questions are: How do I work with or negotiate with my dealer to buy at lease end if BMWFS leads me to believe that the residual is not the price? Am I off base and I should expect to pay residual + CPO charge? What should I expect the CPO adder to be?

Thanks in advance.

Personally I would not consider buying the car unless you can negotiate a price that is close to the fair market value of the car if it were sold on the open market.

Put it this way. Forget that you have leased this car. What would you pay for a CPO with your configuration and mileage?

It is possible the dealer will prefer to let you keep the car rather than have to deal with taking it back and selling it as a CPO.

Originally Posted by RaveD

Personally I would not consider buying the car unless you can negotiate a price that is close to the fair market value of the car if it were sold on the open market.

Put it this way. Forget that you have leased this car. What would you pay for a CPO with your configuration and mileage?

It is possible the dealer will prefer to let you keep the car rather than have to deal with taking it back and selling it as a CPO.

Just curious and good to know........not that I am interested right now since my lease on 535i is ending in Dec 2013 but how will you find out the price you mentioned "a CPO with your configuration and mileage?".?

Look for my posts about this as I've posted several times about the process.

I purchased my car at lease end. Yes the dealership gets two prices from BMW NA -- one if they keep it and sell it to someone else, and another, higher, if they sell it to you, the lessee. Those prices are based on current values, auction prices, etc. In my case, I overpaid VERY slightly over what I could have haggled for something off of SOMEONE's lot, but I was ok with it as I was getting "to keep my car." The price was well below the BMW NA residual value.

Residual value is used to calculate the lease and has zero bearing on what the dealership will pay BMW NA for the car at lease end and thus what they will charge you.

Remember of course that there is some mark-up over what the dealer pays BMW NA. They need to process, inspect, recondition. If you want it CPO'ed, there is the cost of that.

I've said some more in prior posts.

Originally Posted by Bart001

Look for my posts about this as I've posted several times about the process.

I purchased my car at lease end. Yes the dealership gets two prices from BMW NA -- one if they keep it and sell it to someone else, and another, higher, if they sell it to you, the lessee. Those prices are based on current values, auction prices, etc. In my case, I overpaid VERY slightly over what I could have haggled for something off of SOMEONE's lot, but I was ok with it as I was getting "to keep my car." The price was well below the BMW NA residual value.

Residual value is used to calculate the lease and has zero bearing on what the dealership will pay BMW NA for the car at lease end and thus what they will charge you.

Remember of course that there is some mark-up over what the dealer pays BMW NA. They need to process, inspect, recondition. If you want it CPO'ed, there is the cost of that.

I've said some more in prior posts.

What he said plus I would not buy that car. There have been lots of problems with the fuel pump, injectors etc. and even if you have a warranty problems are still a pita. Also financially it doesn't make sense unless you keep the car for 10 years because the value of the car is going to be very low when the mileage gets high.

Originally Posted by Bart001

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Remember of course that there is some mark-up over what the dealer pays BMW NA. They need to process, inspect, recondition. If you want it CPO'ed, there is the cost of that.

I've said some more in prior posts.

Can I just comment that the whole "process, recondition, inspect" argument is usually nonsense. Some do, most don't ... and surely when YOU are buying YOUR car, they just toss on a superficial "detail".

Do keep in mind that they might not cpo it if the tires are under 50% or if the pads are under 50%.

Barts advice is spot on though. You can shop this deal with ANY other dealer, so choose carefully. You want one that will not screw you over. As with all deals if they KNOW you really WANT it, they will be more likely to squeeze you.

In my estimation, the dealer pays $2000-2500 for the CPO warranty to BMWNA. They should make $500 on the 'deal' in profit. So add 2500-300o onto the "BMWFS price for a dealer 'sale-to-current-owner' price" As Bart said, ALL the dealers prices will be under the residual value on your lease..

"Look for my posts about this as I've posted several times about the process." - Thanks. I will certainly look into your posts about this.