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2013 and earlier BMW X5 Lease Questions



  • ashedmashedm Posts: 3
    edited November 2011
    This is not a Capital Cost Reduction (CCR) based lease deal.
    This is a 7 MSDs kind of a deal.

    The total due at signing came out to $7830.32, including $5600 in MSDs and $2230.32 towards acquisition fee, first months payment and registration costs.

    Monthly payment ==> US$ 799 (incl Tax)

    I am not convinced at all with this. With MSD deal, should I have to pay up front ?

    Any advise would be great?
  • wtikwtik Posts: 26
    you are paying too much.
    Call BMW of Cape Code. They worked a better deal in the past.
  • Wtik,
    Is there a specific advise on which factor I should focus on?
  • Hello Ashish. BMW Financial Services' current buy rate lease money factor and residual value for a 36-month lease of a 2012 X5 50i with 12,000 miles per year are .00195 and 61%, respectively for consumers who qualify for its top credit tier.

    The money factors for loyal customers would be lower than this.

    The money factor that you were quoted is way out of whack. Either don't qualify for BMW's top credit tiers, or more likely the dealer is attempting to mark BMW FS' base rate up on you to add additional hidden profit to your deal.

    Prices Paid: Buying & Leasing Experiences Forum
  • CarMan@Edmunds[email protected] Posts: 38,515
    edited December 2011
    What you heard is correct, loyal customers are eligible for either a $1,000 credit or the .00030 money factor reduction, but they can't get both. Even better, if you are in a BMW FS lease that is scheduled to expire between now and the end of February, you're eligible for another .00075 money factor reduction on top of this.

    $1,000 over invoice is a decent price...if the dealer is subtracting the $1,000 BMW FS credit from that lowering the price to invoice, but not enough to justify the dealer marking up the money factor. Unless you are in an area that doesn't have much in the way of competition you shouldn't let the dealer get away with the mark up. I certainly wouldn't.

    One other thing, $6,000 to $8,000 is way too much money to pay at lease signing. I always advise consumers to pay as little as possible at signing on leases. I do so because consumers who make large down payments on leased vehicles risk losing part or all of the money that they put down if their vehicle is totaled in an accident or stolen and never recovered.

    I hope this helps. Let us know if you have any other questions.

    Prices Paid: Buying & Leasing Experiences Forum
  • Hello Carman

    Thanks for the great advise you have been giving to BMW leasers like us.

    I have a question re: tires for X5 lease
    do i have to put new tires before returning the car back? I mean could they chrge me for a set of new tires when i return?

    Thank you
  • Hi Car Man,

    Can you please give me the December MF and residual, and any incentives for an X5 35i. I am a current BMW lease holder and will qualify for top tier credit. Thanks,
  • Sorry,

    I forgot to give you all the info.

    36 month lease
    12k per year
  • ashkoashko Posts: 4
    Car man

    Can you explain the promotional lease? The offer is 589 per month with 4300 due at signing.
    They also offe the 1000 credit and 1730 option credit. Is it built into the deal? The promotional is on an msrp of 50250 and the car I am looking at is 46.5 selling price.

  • Hi

    I hope someone can help. We are new to leasing in the US. Trying to work out whether this is a good deal or what we should be looking out for? What deals other are getting with similar config.
    All advise greatly appreciated. BTW we are in LA.

    We are looking at

    2012 BMW X5 Diesel
    Ext: Alpine white
    Int: Black Nevada lether
    Dart Bamboo trim
    Sport Activity Package
    Premium Package
    Running boards
    BMW Apps
    Space-saver spare
    Total as built: $64,775
    Selling Price : $58,915

    36 months
    10,000 miles per/year
    Money factor 1.95 (what is the APR?)
    Residual Factor 54%
    Residual value $34,978.50
    Total depreciation $18,708.74
    Capital reduction $5,227.76 (what is this?)
    Monthly Depreciation $516.69
    Monthly rent $172.90
    Month payment $692.59 + 8.75 tax = $753.19

    Drive off $8,000 less rebate $1,000
    Total due at signing $7,000

    Thank you in advance !
  • This NOT a good deal.
    YOu should be getting a better price because there are promotions.
    You should not do any cap reduction -- that is your putting money into the deal.
    What dealership are you with.
    I was offered a much better deal.
  • Hey thanks for the reply

    We re using a broker but I believe it is thru Center BMW, LA - what was you deal and where was it from. What sort of many factor or APR should we be looking at we have an excellent credit score.
  • My lease was ending on my 535i in Feb. and salesman said he could get me out early. My payoff was 36k and BMW lowered it to 29k and the dealer purchased it for that price. I didn't know that could happen. Anyway, with my credit score dealership gave me a .00090 MF. with 56% residual on 36 month 12k a year lease.
  • CenterBMW is a solid dealership.
    But when I was looking at deals, the ywre far better.
    Make sure you get the net money factor that is on this website, with no markup.
    Make sure your price is invoice MINUS any BMW promotions. For example, if BMW has a $2500 promotion, then deduct that from invoice.
    After that is all done, then ask to re-do the deal with maximum refundable security deposits to produce a lower money factor and lower monthly payment. Let me know what happens.
    If you're still not there, I can tell you that there is a salesman at Bob Smith wh will give a good deal. I don't know if I'm allowed to mention salesmen on this site.
    Also, there is a guy at Center I can recommend, but I don't know if I can menttion ames on this site.
  • abmwfanabmwfan Posts: 47
    edited December 2011
    $7k cash down payment on a lease is excessive. Each $1,000 of cash down payment typically reduces your payment by about $30/month. This deal requires you to put $7,000 down, reducing your payment by about $210/month. But, for a lease, you will want to put as little money down as possible. If the vehicle is in an accident and totaled, the gap insurance will only pay the minimum contract balance needed to close your contract. The more money you put down, the less money the insurance company pays and you get nothing back.

    Three different incentives/rebates are currently available on the diesel X5: $2,500 eco credit, $1,000 "ghost protocol" rebate for the X5, and $1,000 (or an interest rate discount) for returning BMW owners. (I assume you're not a member of the BMW Car Club, but if you were, you'd also get an additional $1,000 rebate check in the mail.)

    A better way to evaluate this deal and negotiate a lease is to arrive at the actual purchase price (same as you would if you were paying cash) and THEN negotiate the lease terms.

    In my experience buying/leasing BMWs, you typically should expect to pay NO MORE than $1,000 ($1,500 in some regions) above dealer invoice on a vehicle like the X5 using a broker (like Costco, USAA, etc.) Some dealers will sell for closer to invoice if you compete them against each other or the car has been on the lot for a while. (They won't deal on a new/hot/limited availability model, but the X5 is not new/hot/limited.)

    Dealer invoice + $1,000 profit - $2,500 (eco credit) - $1,000 (ghost protocol rebate) - $1,000 (owner loyalty if you're eligible) = gross capitalized cost. Then add tax, tags, acquisition fee, processing fee, etc. to arrive at your cost of the vehicle.

    Your deal does not look good. The invoice on that vehicle is around $59,500 (ask your dealer/broker to show you the actual invoice.) That means your price before tax/tags/title/etc should be around $57,000. (You should get the invoice and do the math). Then add local tax, tags, title, etc to get your purchase price.

    You stated the money factor is"1.95". That probably means .00195, which is the typical way of showing it. The equivalent interest rate is .00195 x 2400 = 4.68%.

    The other question to ask your dealer is how much they marked up your lease money factor. Dealers will add as much as 50 basis points to the "interest rate" of your lease to pad their profits. Sometimes they'll sell closer to invoice and then pad the money factor. If they marked up your money factor, ask them to split the mark up with you.

    If you're paying a security deposit and have good credit, they often will waive the security deposit. But, be careful. Sometimes they'll increase your money factor if they waive the security deposit. Don't let them do that.

    Next, think about which X5 model you want. If your heart is set on a diesel, go for it. I've had 2 X5 diesels and was very happy with them. But pay attention to the residuals across the different X5 models. November/December residuals for 2012 X5 diesels are VERY low. Your residual of 53% is correct for that lease term. But the residuals for the 3.5i and 5.0i are much higher. For comparison purposes, the residual for a 5.0 using the same lease terms is 62%. That means you are paying 9% (about $5,400) more depreciation out of pocket for the diesel. The $2,500 eco credit doesn't begin to offset that lousy residual. And it would take you a very long time to recoup that $5,400 from the diesel's higher mpg. In fact, you can never recoup that extra depreciation cost from fuel savings in 36 months @ 10k/miles/year.

    For comparison purposes, I just leased (yesterday) an X5 5.0 with a $74k sticker for 36 months and 10k miles/year with ZERO money out of pocket for $960/month. That's about the same that your deal would cost if you put no money down. But I leased a vehicle that was $10k more expensive than your diesel. I don't think you're getting a very good deal.

    I hope this helps.
  • abmwfanabmwfan Posts: 47
    edited December 2011
    I'm not Carman, but I did stay at a Holiday Inn last week and I have experience with this question. You do NOT have to replace the tires on your vehicle before lease turn in if the tires meet the minimum tread depth in your lease turn in guide or the inspection form. It's very explicit:

    minimum 4/32" (1/8") tread depth measured from thinnest tread not on the wear bar. Tires must also be free of additional damage such as but not limited to cuts, bulges or severe curb rash. (Including spare if applicable.) Tires must be run-flat if that's what shipped on the car when it was new.

    The charge is $300 per tire that does not meet this standard.
  • pmenpmen Posts: 1
    Hi, just took delivery on a new 2012 BMW X5 diesel. Alpine white with sand beige leather with premium pkg w/ navigation. MSRP 61075.00. Invoice 56,425.00 Negotiated price 53426. Total with tax tag and acq fee, 56152.

    Details are as follows:
    Offered 14,000.00 on trade of a 2004 BMW X5 3.0 with 80K miles in good condition.
    Provided 3000.00 in additonal cash out of pocket
    The rest was incentives, eco, nav, customer loyalty.
    Total credits from cash net equity and discounts, 6750.00

    Worked out to be 53% residual of 32369.00, money factor of .00025
    Monthly payment 651.00 for 3 years and 36000 miles. Thanks in advance for your review.
  • abmwfanabmwfan Posts: 47
    edited December 2011
    My personal opinion (in case it matters because I'm not Carman) is that your deal looks kosher and your negotiated price was reasonable. It appears that the dealer started at $1,500 over the invoice, then subtracted current incentives of $4,500 ($2500 eco credit + $1,000 owner loyalty + $1,000 ghost protocol/December promotion). You got a deal that is as good or better than using a buying service. (If you did NOT get the $1,000 owner loyalty or used the lease money factor credit instead, then your deal is even better because your negotiated deal would have been $500 over invoice.)

    My advice (again, in case anyone cares what some guy on the internet thinks) is to enjoy the new car (including the excellent high-torque diesel engine and 600+ miles per tank on the highway). Don't let worry about whether you could have fine-tuned the deal to save a few more dollars spoil the fun of a new BMW. You traded out of the first generation X5 into the current generation. You'll enjoy a huge improvement between the two vehicles.
  • You're very welcome x5fan10. As long as your vehicle's tires aren't bald you probably don't have to put a new set on it before returning it at lease-end. Most banks have some sort of specific guideline as to how much tread has to be left on the tires of leased vehicles in order to avoid paying a penalty, but I'm not sure of BMW FS' exact policy on this matter.

    On a personal note I've probably leased a million vehicles in the past and I've never had to replace the tires.

    Prices Paid: Buying & Leasing Experiences Forum
  • I'd be happy to help you out robprivi. BMW Financial Services' current buy rate lease money factor and residual value for a 36-month lease of a base 2012 X5 35i with 15,000 miles per year are .00195 and 51%, respectively for consumers who qualify for its top credit tier.

    As a current BMW FS customer, you are eligible for a .00030 money factor reduction. If you have a BMW lease that is scheduled to expire over the next couple of months that reduction jumps to .00105.

    Prices Paid: Buying & Leasing Experiences Forum
  • Ahhh, robprivi, I see that you only wanted 12,000 miles per year. In that case, this truck's residual values would be 2% higher.

    Prices Paid: Buying & Leasing Experiences Forum
  • Hi ashko. Savvy consumers who are in an area that has a decent level of competition are usually able to negotiate lower selling prices than the ones that were used to arrive ay manufacturers' official advertised payments. If you shoot for $500 to $1,000 over dealer invoice minus the cash incentives that you mentioned you should be able to do better than the $589 per month on an equivalent vehicle.

    Prices Paid: Buying & Leasing Experiences Forum
  • HA. Great answer abmwfan. Thanks for the detailed information!

    Prices Paid: Buying & Leasing Experiences Forum
  • shapappyshapappy Posts: 1
    edited December 2011
    Trying to complete a deal, but something feels off.

    Msrp: $66895
    Sale price: 58795 ($1k over invoice)
    Incentives I received: $2500, $1730, $1000
    36 months, 12k miles (53%) MF .00195
    $2600 due at signing
    Monthly payment $ 921.20 including tax (7.00 FL tax)

    One thing to note. I added a BMW tow hitch which upped the sale price to $60,295. Now, should I add the $1500 tow hitch to the msrp price also. That would raise the residual value. By my estimates, the payment should be below $900. Any help would be great!
  • I need some suggestions from you all.

    I want to know if it is good financially, If I lease first for 36 months and then buy at the end of lease or shoudl I just buy at once for all.

    Thank you
  • kyfdxkyfdx Everywhere, USAPosts: 123,000
    If you lease first, you'll pay an acquisition fee that isn't present in a straight purchase.... ($725-$925)....

    Not only that, interest rates on finance are dirt cheap, right now... Even if you found a lease that has a good interest rate, the rates might not be so good to finance a used car in three years...

    If you know you want to purchase, eventually, you are better off doing it upfront...

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

  • Thank you.

    I agree with your point about interest rate.

    I am little concerned about mainteance issue after 3 years.
  • Why are you concerned about maintenance after 3 years? The full warranty is 4 years / 50,000 miles.
  • abmwfanabmwfan Posts: 47
    edited December 2011
    Your starting point should be $1k over dealer invoice and THEN subtract all incentives. Was that the deal? If not, you're paying too much.

    The lease rate looks right.

    Assuming this is a dealer installed towing hitch, discount the price of the hitch by 5%. Then add the discounted part cost and the dealer's installation charge to the dealer invoice price (not the MSRP). Then subtract all incentives.
  • abmwfanabmwfan Posts: 47
    edited December 2011
    I would not recommend a lease if you are sure you plan to buy at the end of the lease. The only advantages are that you get a lower payment during the lease period and an option to turn in the vehicle if you don't like it. But leasing to buy can result in higher interest rates and longer total finance periods, so your total cost usually is higher over the long run.

    If you buy at the end of the lease, you'll be refinancing a used car via another loan (unless you plan to pay cash.) You incur interest rate risk because you don't know what the interest rate will be in 36 months. It may be subsidized by BMW for pre-owned vehicles, but it probably will be closer to market than the new car loan rate that you will get now.

    If you buy now, you can take advantage of interest rates that are subsidized by BMW NA for new car sales.

    The only time that I would recommend leasing to buy is if you're not sure you want the car long term or if you're worried about maintenance problems. In that case, you have to be willing to pay a premium (lease rates, acquisition fee, etc) to have the option to turn it in. And there is an additional advantage to leasing: If you have an accident that requires significant vehicle repair, you have the option to turn in the vehicle at the end of the lease and BMW takes any depreciation hit. If you buy/own the car, you assume all depreciation risk.

    BMW used to have a finance program called Owner's Choice, but it is discontinued in my region. It gives you the option to turn in the car or finance a balloon payment at the end of 36 months. I don't see a real advantage other than you are buying the car with lease-like terms and have the option to turn it in.

    For comparison purposes, people are reporting lease money factors here as low as .00195 this month. That is the equivalent of 4.68% plus the additional cost of the acquisition fee. Can you buy for a lower interest rate than that and avoid the wasted acquisition fee?
This discussion has been closed.