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BMW 5-Series Lease Questions

CarMan@EdmundsCarMan@Edmunds Posts: 38,515
Hi everyone. Please use the following discussion to post any questions that you have about leasing a BMW 5-Series. Thanks.

Car_man
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Comments

  • hpowdershpowders Posts: 4,269
    Hey Car_man.
    Do you know the residual value and base money factor for the new 2006 BMW 550i for a 36 month, 36,000 mile lease?
    Thank you.
    hpowders
  • Hey hpowders. Here is the information that you are looking for. If you were to lease a 2006 BMW 550i through BMW Financial Services right now for 36 months with 12,000 miles per year its buy rate lease money factor and residual value should be .00280 and 59%, respectively.

    Car_man
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  • hpowdershpowders Posts: 4,269
    Thanks Car_man.
    Ouch! ;)
  • Hello,

    What is the current money factor and residual value for a 545 for a 36 month/15k miles per year lease in southern california. Thank you in advance.
  • You're welcome hpowders. Ouch is right, BMW is not providing any sort of lease support on this new model yet.

    Car_man
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  • Hello hummus1. According to the latest information that I have seen, if you were to lease a 2005 BMW 545i through BMW Financial Services right now for 3 years with 15,000 miles per, its buy rate lease money factor and residual value should be .00100 and 57%, respectively.

    Car_man
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  • Any price information on leasing a 530xi with 15K miles for 36 or 39 months?

    Thanks.
  • I am negotiating with a S CA dealer on the 2005 545i. He is quoting me $800/ month +tax with $2500 down for 36 Months with 10K miles.

    How does this compare to the info you posted. I am not familiar with the terms 'buy rate lease money factor", or how the residual factor plays into the monthly payment calcs

    thanks
  • That is an absolute ripoff. Run, don't walk from the crooks. That is a good $200 more per month that you should pay--especially with 10K miles and a $2500 cap cost reduction.
  • Thanks for the heads up. I think the $2500 is the drive off amount, so it includes the 1st month payment. I went to Shelley BMW Buena Park

    Can you suggest any good dealers in the Long Beach area?

    Thanks
  • Hi jaygil. I can give you an idea of what this car's current lease program is like. If you were to lease a 2006 BMW 530xi through BMW Financial Services for 36 months with 15,000 miles per year, its buy rate lease money factor and residual value should be .00195 and 60%, respectively. If you provide me with the full MSRP and an approximate selling price for the exact car that you are interested in, I can calculate a lease payment on it for you.

    Car_man
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  • Hi t&csteve. It sounds to me as though you have never leased before. if you are indeed new to the world of leasing, you definitely should check out the following informative articles that are available here at Edmunds.com prior to visiting any dealers: 10 Steps to Leasing a New Car and Calculate Your Own Lease Payment.

    You never mentioned the selling price or MSRP of the car that you are interested in leasing. These are important numbers for you as a consumer to know for two reasons. First, the selling prices of leased vehicles can be negotiated, just as if you were paying cash for them. Without knowing this car's selling price in relation to its MSRP you don't know how much of a discount you are getting on it. The second reason is that one needs the selling price and MSRP, including the destination charge, of a vehicle to calculate its lease payment. I would be more than happy to give you my opinion of this deal if you let me know what these numbers are.

    Car_man
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  • Carman is correct. The most common mistake that newbies to leasing make is to negotiate the monthly payment. That is a recipe for getting ripped off by the "stealer."

    Never enter into a lease without knowing the total capitalized cost of the lease, the money factor and the residual. These three things determine the lease price.
  • I'd like some help verifying some numbers for an '05 545 lease. The dealer is quoting:

    59% resid (12k miles/36 mos)
    .0014 MF
    $825 Acquisition fee

    I believe the residual is correct, but isn't the current MF supposed to be .001? They tried to mark it up when I leased my 330 a couple years ago. I called them on it and they gave me the book value for MF back then. So I'm confident I can do that again so long as I can substantiate the current values.

    I have zero information on the Acquisition, but this feels high to me. Any way out of the Acquisition fees? Also, I didn't see any disposition -- and can't recall if BMW does that.

    I'm going to aim for $1000 over invoice. I think that's realistic given the phase out of the 545 -- what's been the experience of buyers over the last couple months?

    Any other incentives or programs I could leverage here?

    The dealer seems to think that if I wait until winter to order a 2006 530i with lots of options that I'll be in the same ballpark payment wise, so it's a better deal to step up for the 545 now for a nominal amount. Any opinions on this?

    MSRP on the car I want is $59,520 and CapCost is $54,390. Using MF .001 and Resid of 59%, I come up with $715.50/mo. Is that right? And how does the acquisition affect it if I roll it in? Does it go into both the MSRP and CapCost figures?

    Thanks for any and all feedback!
  • kyfdxkyfdx Posts: 28,029
    1) Residual is correct (dealer can't change this, anyway)

    2) Base MF is .0010... your dealer is marking it up the maximum

    3) Base acq.fee is $625.. again, your dealer marking up the maximum.

    4) Your calculation is incorrect.. given your figures, the payment would be $625/mo. + tax... If you roll in $625 for an acq.fee, then the payment would be $643/mo. + tax..

    If you use .0014 for the MF and roll in $825 for the acq.fee, then the payment would be $685/mo.+ tax..

    $54,390 would be a great selling price, if you can actually get it..

    regards,
    kyfdx
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  • Thanks, Kyfdx. Actually, I may have specified some wrong numbers above. Could you help me calculate the monthly using the following:

    MSRP $59,520
    Invoice $54,390
    Negotiated price of vehicle & optoins $55,390 or $55,890 (either $1000 or $1500 over invoice - which I'm willing to negotiate to)

    MF .001
    Resid 59%
    36mos / 36k miles
    Acquisition $625 (rolled in to lease)
    6.5% state tax
    No cap cost reduction

    And a question on the acquisition. When you roll it in for calcuation purposes, do you add it to both the MSRP and the purchase price, or just the purchase price?

    Thank you very much!
  • kyfdxkyfdx Posts: 28,029
    $55,390 selling price.. base MF.. payment $654/mo. + tax
    w/$625 acq.fee rolled in... $672/mo. + tax

    $55,890 selling price.. base MF.. payment $668/mo. + tax
    w/$625 acq.fee rolled in.. $686/mo. + tax

    The acquisition fee is either paid upfront or rolled into the CAP cost.. It has no effect on the MSRP.

    Each state may have it's own method of calculating sales tax on auto leases... Some just charge it on the monthly payment.. If that is the case in your state, then it is a simple calculation..

    regards,
    kyfdx
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  • thanks again for your timely response. On my way to the dealer now!
  • Hey Car Man.

    I will be leasing a 2006 530i with an MSRP of $57,990 and purchase price of $54,495. The total drive offs will be $5301 (including $3000 down payment). The money factor is .00240 and the residual is 60%. It's a 36 month lease with 15,000 miles per year. The payments, including tax, are $727.26. The money factor seems a bit high to me. Can I do better?

    Thanks.
  • Hi bimmerbuyer. The lease money factor that you were quoted to lease this car is a little high. BMW Financial Services' current buy rate lease money factor for the 2005 545i is only .00100 for leases up to 42 months in length with the payment of a security deposit. BMW FS' base lease acquisition fee is currently only $625, so it looks as though this dealer is trying to mark that up on you as well. I believe that BMW FS charges a $350 disposition fee, but it will waive it for returning lessees.

    On the car that you are interested in, a 2005 BMW 545i with an MSRP of $59,520 and a capitalized cost of $54,390, using a money factor of .00100 and a residual value of 59%, I come up with a zero down, pre-tax monthly payment of around $625. Adding a $625 acquisition fee to this cap cost would increase the payment to around $643.

    Car_man
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  • Hello kevhollywood. The first thing that I noticed about your lease is the large down payment that you plan on making. I always advise consumers against making any sort of down payment when leasing. I do so for two main reasons. The first is if your vehicle is totaled in an accident or stolen during your lease, your insurance company pays off the bank that you were leasing it through and your down payment essentially disappears. The second main reason is that down payments on leased vehicles do nothing to reduce their lease-end purchase prices. So your lease-end purchase option price for your 530i would be exactly the same, regardless of whether you had put $3,000 down, or had made absolutely no down payment at all.

    Another problem that I have with this deal is that the money factor that you are being charged on this car is way too high. BMW Financial Services' current buy rate lease money factor on the 2006 530i is only .00175. This means that the dealer that you are working with is marking-up your car's money factor to add additional back-end profit to your deal. This sort of practice is fairly common amongst BMW dealers, but usually can be avoided by comparison shopping or confronting the dealer that you are working with with your vehicle's actual buy rate. Using BMW's actual base lease program for this car and the prices that you provided in your post, an MSRP of $57,990 and selling price of $54,495, I come up with a 36 month, 15,000 miles per year zero down, pre-tax monthly payment of around $704.

    Car_man
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  • Thank you so much Car Man. This information is EXTREMELY helpful. I nearly got ripped off!
  • I am looking at a lease on a black on black 545 with...

    Sport Pkg
    Premium Sound
    Cold Weather Pkg
    Auto trans.
    Sat Radio
    Heated Rear Seats
    Sun shades

    The dealer is telling me that although the 545 is an outgoing model... that demand is still very high... also the supply is now very limited. With that in mind, what type of amount off of MSRP (around 65k) should I try and negotiate? Based on above messages... I will definitely be sure to get the .0010 money factor. What monthly payment should I be looking at if I can negotiate down to something like 62k)? I am in So.Cal. Thanks!
  • I know people who have recently gotten the 545 for about $1500 over invoice. Your dealer is full of crap and is trying to bamboozle you into overpaying. If I were in your shoes, I would call sales manangers at all area dealerships and offer something in the vicinity of $1500 over invoice. I guarantee you, they will sell it to you at that price. The key is to talk to multiple dealers. If you somewhat cannot get into that price range, try dealers who is not in So. Cal. I live in the NYC area and, to save $$, I have sometimes leased cars from dealers outside of the NYC metro area, such as in Central Pennsylvania. Well worth the extra drive if you can save big $$.

    Also, you do not need to go into the dealership to negotiate the deal. I have done all of the negotiations and paperwork via phone and email. Being inside the dealership gives them the advantage over it and the negotiations then occur in more of a pressure cooker environment. The phone and email keep things fairer and at arms length.
  • Car_man, my dealer is alleging that .00175 base rate is only available to returning BMW lessees and that the buy rate for my lease will actually be .00190. Do you know if this true?

    Thanks.
  • kyfdxkyfdx Posts: 28,029
    It seems as though your dealer is bumping up your money factor the required .00015, in lieu of you making a security deposit.. Some returning lessees aren't required to make a security deposit, so he is somewhat correct in the way he worded it....

    However, if you make a security deposit (your payment rounded up to the next $50 increment), then you can get the same base rate... If you don't make a security deposit, then the base rate is indeed .00190

    regards,
    kyfdx
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  • Thanks for the info 540dude. The dealer has come down to $2500 over invoice... for now. Additionally, the .0010 money factor is only for returning customers... unless you put down a security deposit. The thing is... they are telling me that they have to actually trade for this car from another dealier in central Cali... and that they will incur shipping expenses. Is it feasible to think that a loaded 545 black on black is no longer available in LA? Seems strange to me that there are not at least a few left. I have called a few dealers though... have only found one... and it did not have the sport package I definitely want.
  • Well you have made some progress but $1500 over invoice is the target. If I were you, I would call Sales Managers at dealers all over the state. You'll get your price. Try dealers outside of car-crazy So. Cal., where demand for the 545 is highest.
  • "they are telling me that they have to actually trade for this car from another dealier in central Cali... and that they will incur shipping expenses. Is it feasible to think that a loaded 545 black on black is no longer available in LA?"

    It's certainly possible, but dealer exchanges happen all the time. And it's no big deal...someone from Dealer A gets in the car and drives it to Dealer B, trades for the desired car (with a check for any price differential), and then drives back to the original dealership. I did a few for extra $$$ when I was in college (what fun to drive brand new Audis!), but trust me, the expenses are negligible.
  • You're very welcome, kevhollywood. I'm glad that I was able to help you out.

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