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So when a residual is set to something like 68% of MSRP, is the MSRP of optional equipment and or accessories sold at the time of purchase calculated into the lease?

On that note, is it usually better to lease a bare bones model vs. a loaded one?
 

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Factory options are included for the calculation of the residual. Dealer installed options usually are not. Adding options usually helps lower the payment as the markup on options are generally higher than the base vehicle.
 

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LeaseCompare said:
Factory options are included for the calculation of the residual. Dealer installed options usually are not. Adding options usually helps lower the payment as the markup on options are generally higher than the base vehicle.
From my experience, adding options never lowers a payment on a BMW lease. In nearly every case I've seen, extra options always equals higher monthly payment. One of the few cases that I can recall in recent memory where a more expensive car was cheaper to lease was my parent's X3-- in 2004, BMW charged extra for a moonroof and auto trans on the 3.0, so the MSRP included $1275 and $1350 for these items. When they got the car, I was able to get a special incentive from BMW which basically made those options "free" by reducing the selling price, but the residual was still based on the higher MSRP.

As for accessories, BMW does allow partial residualization for some options, including (but not limited to) CD changers, aerodynamic kits (you have the get the entire kit, not just part of it), accessory hard tops on convertibles, running boards on SAVs, etc.

Dealer-installed accessories, such as alarms, Lojack, paint sealants, warranties, etc. are not residualizable.
 

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"residualizable" -- I like that word. Can I use it in Scrabble?

SARAFIL said:
From my experience, adding options never lowers a payment on a BMW lease. In nearly every case I've seen, extra options always equals higher monthly payment. One of the few cases that I can recall in recent memory where a more expensive car was cheaper to lease was my parent's X3-- in 2004, BMW charged extra for a moonroof and auto trans on the 3.0, so the MSRP included $1275 and $1350 for these items. When they got the car, I was able to get a special incentive from BMW which basically made those options "free" by reducing the selling price, but the residual was still based on the higher MSRP.

As for accessories, BMW does allow partial residualization for some options, including (but not limited to) CD changers, aerodynamic kits (you have the get the entire kit, not just part of it), accessory hard tops on convertibles, running boards on SAVs, etc.

Dealer-installed accessories, such as alarms, Lojack, paint sealants, warranties, etc. are not residualizable.
 

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Robert A said:
"residualizable" -- I like that word. Can I use it in Scrabble?
:rofl:

I swear I didn't make it up! It's in a BMWFS handbook somewhere!

Found it:

RESIDUAL VALUES/RESIDUALIZING OPTIONS

...whenever a Center installs a residualizable option...
 
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