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Discussion Starter · #1 · (Edited)
Hi, new member here, nice board

I just graduated from college and will finally have some money to get a 3 series :) . I have a couple of questions about the e90.

1. Can I do a 2yr lease? or is 3 the minimum for a bmw? After it comes out I will be moving in about 2 years so this is why I ask?

2. How much will the difference between a 3 yr or 2yr lease be? ($100) and my monthly payment? .... $350 - 400 ?

3. Lets say I want to take the car with me, will it be worth it if I want to do the bargain purshace option after the lease term is over?


Thank you.
 

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yes, you can do a 24 month lease. At the time of my lease, 24 mo. had the best rate. Now, I have about 1 year to go and I have decided to purchase the car at the end of the term, or I might just finance it now.
 

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Wanted said:
is the difference in payment between a 2 yr lease and a 3 yr substantial? or is there no difference?
The payment is much higher or everyone would take the 2 year lease to have newer car more often.
 

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I am doing a 2-year lease on a E90 325i, and I am doing ED because it is a very good deal. Somehow, in my case, the payments for a 24 month are about $40 less per month than a 36 month lease. I think it is because the 24 month residual on the 325i is so strong (74%).

If you are looking into leasing a BMW, you must look into ED, it might be the best deal you can get on a car, period.
 

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Wanted said:
Hi, new member here, nice board

I just graduated from college and will finally have some money to get a 3 series :) . I have a couple of questions about the e90.

1. Can I do a 2yr lease? or is 3 the minimum for a bmw? After it comes out I will be moving in about 2 years so this is why I ask?

2. How much will the difference between a 3 yr or 2yr lease be? ($100) and my monthly payment? .... $350 - 400 ?

3. Lets say I want to take the car with me, will it be worth it if I want to do the bargain purshace option after the lease term is over?

Thank you.
1. Yes, you can do 2 years, or 30 months or 3 years or 42 months, etc.
2. Lease rates change every month. If the residual is high (like it is with 325's) and the interest is high (BMW is now around 7 -8%), a shorter lease will be better. If the interest rates go down, a longer lease will get cheaper proportionately.

The difference in payment depends on the interest rate, total price of car, sales tax, and whether you put any $ down. With nothing down, you won't likely be at 350 - 400, but it depends on what options you get and what price the dealer has on the car.

3. It depends on what the blue book value of the car is relative to the residual, and what the interest rate would be on the purchase.
 

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Discussion Starter · #8 · (Edited)
Questions about ED Leasing, (sorry, I have never leased a car :) )

1. You go to Germany to set the agreements for the lease or can you set them here?

2. Can they ship a 325i as soon you do the agreement? is the 325i already in production?

3. After the lease is over, do you have to ship it back to germany, or can you excercise the purchase option here?

4. If I put 5-6k down, how much does one expect the monthly lease payment to be?

Sorry for all the questions,

Thank you
 

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If you do lease either way, be sure to negotiate both the purchase price and the Money Factor (interest rate) and don't let them slap obnoxious fees onto it (although the admin. fee seems pretty standard for BMWFS).

Also, see what kind of MF/residual you can get through a private leasing company first, then you can just negotiate the price with the dealer instead of the financing. Because this is a hot car, BMW probably won't have any amazing lease deals on it for some time, so you may get a better deal this way.
 

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Wanted said:
4. If I put 5-6k down, how much does one expect the monthly lease payment to be?

Sorry for all the questions,

Thank you
Never put money down on a lease (unless there is a $1000 minimum or something). You save no money that way.
 

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Wanted said:
Questions about ED Leasing, (sorry, I have never leased a car :) )

1. You go to Germany to set the agreements for the lease or can you set them here?

2. Can they ship a 325i as soon you do the agreement? is the 325i already in production?

3. After the lease is over, do you have to ship it back to germany, or can you excercise the purchase option here?

4. If I put 5-6k down, how much does one expect the monthly lease payment to be?

Sorry for all the questions,

Thank you
You should check out the ED forum on Bimmerfest. It has everything you need to know. The "Search" function is your friend.

Some quick answers:

1. You do the entire deal with a dealer in the USA. You are actually buying a US-spec vehicle.
2. You have to actually go to Germany (Munich, specifically) and physically pick up the car. Once you do, you can drive it straight to the dropoff and fly home that day if you want, or you can drive it around Europe for up to 2 weeks at no extra charge.
3. Once the car gets back to the US, it's just like you signed a lease for one right off the lot.
4. I would definitely aviod putting any substantial amount out of pocket as a down payment on a lease. If the car gets totalled or stolen during the lease term, you will never see that money again. You're better off putting that money away and drawing from it month-to-month to help make your monthly payments. Having said that, a lease on a European Delivery vehicle usually has a "built-in" down payment of several thousand dollars just due to the fact that the residual amount is a percentage of the US retail price of your car, and the "capitalized cost" (i.e. the selling price) of the vehicle is substantially lower because of the ED discount. The lease payment formula is something like this:

((capitalized cost - residual value) / lease term) + ((total cost + residual) * money factor).

You can see that to get maximum benefit from a lease, you need to minimize the
(capitalized cost - residual value) part of the equation. ED really helps out in this scenario.

Check out www.leaseguide.com for a good lease payment calculator, and the "Ask-a-dealer" forum here to get the MSRP and invoice prices for the new 3 series.

-MrB
 

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BrettInLJ said:
Never put money down on a lease (unless there is a $1000 minimum or something). You save no money that way.
That's generally damn good advice but a wee bit simplistic. If you can finance the money down ("cap cost reduction") at a lower interest rate, then you will save. You still tie up no cash of your own, plus you reduce the higher interest paid to BMW or the auto lease company.

As to the risk of total loss via theft or collision - there is no right answer to that. You just have to weigh the risks versus the money you will save.

The put the money in an interest bearing account and make the payments from that source idea works if you are getting more interest from the bank than what is charged on the lease - which isn't likely.
 

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Discussion Starter · #13 · (Edited)
Wow guys, you really helped out :thumbup:

Mrbelk, thank you for being so detailed. I understand a lot better now

BrettInLJ, thanks, didn't know about putting 0 money down, sounds right. I will negotiate both the purchase price and the Money Factor

Thanks for the info Whippet.

Thank you all, I appreciate all the help :D
 

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whippet said:
That's generally damn good advice but a wee bit simplistic. If you can finance the money down ("cap cost reduction") at a lower interest rate, then you will save. You still tie up no cash of your own, plus you reduce the higher interest paid to BMW or the auto lease company.

As to the risk of total loss via theft or collision - there is no right answer to that. You just have to weigh the risks versus the money you will save.

The put the money in an interest bearing account and make the payments from that source idea works if you are getting more interest from the bank than what is charged on the lease - which isn't likely.
But if you finance a large lease cap-cost reduction, and you're vehicle gets stolen or totalled, you are still on the hook for that money (plus the interest on the loan) since the insurance payout goes straight to the lessor.

By putting a large DP in some liquid, interest bearing account and drawing from it to supplement your out-of-pocket monthly payment, you have flexibility if/when your car gets stolen/totalled. Sure, you're not likely to make more in interest than you would save in interest charges, but you have that money to do with what you please (like having extra liquidity for emergencies).

For me, it has nothing to do with the interest savings and everything to do with protecting the capital. The interest saved by not making a down payment is not worth the lost peace of mind knowing I could be out several thousand dollars with no chance of recovery.

I am a fairly risk-averse person, though, and have also totalled a leased vehicle and didn't get a dime back from my down payment. Once burned, twice shy.

-MrB
 

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tim916 said:
I am doing a 2-year lease on a E90 325i, and I am doing ED because it is a very good deal. Somehow, in my case, the payments for a 24 month are about $40 less per month than a 36 month lease. I think it is because the 24 month residual on the 325i is so strong (74%).

If you are looking into leasing a BMW, you must look into ED, it might be the best deal you can get on a car, period.
That makes no sense. There is something missing.
Under that logic a 12 month lease would have cheaper payments yet since a 1 year old car has a higher residual than a 2 year old car.

Of course the residual is higher after 24 months than 36 months, but the total depreciation cost is spread over far fewer months, so you have to pay more of it in each payment to get it paid off within 24 months.
 

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mrbelk said:
But if you finance a large lease cap-cost reduction, and you're vehicle gets stolen or totalled, you are still on the hook for that money (plus the interest on the loan) since the insurance payout goes straight to the lessor.

By putting a large DP in some liquid, interest bearing account and drawing from it to supplement your out-of-pocket monthly payment, you have flexibility if/when your car gets stolen/totalled. Sure, you're not likely to make more in interest than you would save in interest charges, but you have that money to do with what you please (like having extra liquidity for emergencies).

For me, it has nothing to do with the interest savings and everything to do with protecting the capital. The interest saved by not making a down payment is not worth the lost peace of mind knowing I could be out several thousand dollars with no chance of recovery.

I am a fairly risk-averse person, though, and have also totalled a leased vehicle and didn't get a dime back from my down payment. Once burned, twice shy.

-MrB
We don't disagree - it's a personal choice, kinda like buying travel accident insurance. The odds of a car in the first 3 years being stolen or totaled where it is one's own fault (no loss if it's the other guy's fault (is Florida no-fault?) and he's insured or one has UM coverage) and one still being being alive to care are pretty damn small. I'd rather save the $, but I certainly understand why you feel differently. There is no right or wrong answer.
 

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It doesn't matter if the other person is at fault since the insurance payout goes to the leasing company, not you, and you lose whatever you put down. The more you put down, the more you have to lose whether it is your fault or the other person's fault or the car is just stolen and totaled or lost permanently. The earlier in the lease the car is lost or stolen, the worse it is for you and you save so little interest for taking the risk with the money.
 

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euro-d said:
It doesn't matter if the other person is at fault since the insurance payout goes to the leasing company, not you, and you lose whatever you put down. The more you put down, the more you have to lose whether it is your fault or the other person's fault or the car is just stolen and totaled or lost permanently. The earlier in the lease the car is lost or stolen, the worse it is for you and you save so little interest for taking the risk with the money.
Right.

Even if it is someone else's fault, the most you can recover from them / their insurance company is the fair market value of the car. If you are $5000 'upside down' due to depreciation happening faster than you've paid down the loan or lease, you must cover that part of the loss yourself (unless you have gap insurance for a lease, right?).

The down payment really doesnt matter to this issue. It's all money, and you either pay it when you buy the car or you pay it when the car is totalled and you're upside down in the loan.
 

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euro-d said:
It doesn't matter if the other person is at fault since the insurance payout goes to the leasing company, not you, and you lose whatever you put down. The more you put down, the more you have to lose whether it is your fault or the other person's fault or the car is just stolen and totaled or lost permanently. The earlier in the lease the car is lost or stolen, the worse it is for you and you save so little interest for taking the risk with the money.
Technically, you're right, but that isn't how it works in the real world if you get a halfway decent lawyer. If someone totals your car and its their fault - trust me, his/her carrier will be paying more than just fmv of your car! The odds are you will be somewhat injured and whether you add a few grand to pain and suffering or general damages or just nuisance value - the insurer doesn't want to incur litigation costs in a case it can't win over a few thousand bucks.

Funny how people are more worried about losing a few thousand bucks than being alive in this hypothetical situation!
 

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Bart001 said:
Right.

Even if it is someone else's fault, the most you can recover from them / their insurance company is the fair market value of the car. If you are $5000 'upside down' due to depreciation happening faster than you've paid down the loan or lease, you must cover that part of the loss yourself (unless you have gap insurance for a lease, right?).

The down payment really doesnt matter to this issue. It's all money, and you either pay it when you buy the car or you pay it when the car is totalled and you're upside down in the loan.
BMW leases do have gap insurance. However, I acknowledge that doesn't totally solve the problem.
 
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