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My dad is leasing and X5 and his lease is over in June. He was told by his BMW dealer that he may extend his lease for another year (it's a 3 year original lease) with same payment. I am in the market for 335i this summer, so I've been thinking- is it possible to start with a 2 year lease (maybe get a better deal because of higher residual, etc. ) and then extend it for another year to make a 3 year total? Has anyone done that?

Any thoughts are appreciated.
Find it hard to believe that your dad is quoted the same payment as of today. BMWFS will determine a lease payment within about 30 days out from lease maturity when they can determine current RV, LRF, etc.

I wouldn't recommend starting a 2 year lease with a lease extension as BMWFS will have recouped all of their economics during the life of the 2 year lease and the extended rents are profit. Wouldn't be in your best interest. You could negotiate a better deal from the start.

Only time I would recommend extending lease is if you are getting into another BMW and didn't sync up delivery, production etc.
 

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The extended rents are not profit. There is additional depreciation (lower residual after 3 years v.s 2 years) and the cost of money over that extra year.
I would tend to disagree with that statement. Assuming all of the economics are covered during the life of the lease term, it is what is called "evergreen".

I should know...I work for the biggest computer leasing company in the world. I'm not gonna argue as there are a myriad of factors but, all things equal, not a good strategy.
 
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