Lease Questions - Ask Here

vishpool · February 2005

Also, do you know if infiniti offers a new graduate discount, like other manufactorers?

gwudc · February 2005

Infiniti does not offer any money back for new graduates but does have some special programs (waive security deposit on a lease, etc.) according to their website and based on my discussions with dealers.

Hope that helps.

gwudc · February 2005

Car_Man,



Welcome back from your vacation.

I am interested in a 2005 Infiniti G35 coupe, automatic, non-navigation, with the premium package.



Based on the pricing information below, I was wondering if you could provide me with the following information for a lease term of:



a) 36 months

b) 39 months

c) 42 months



1) Current Residual Rates for a 12,000 mile per year lease.



2) Current Money Factor(s) for a 12,000 mile per year lease.



3) Estimated payments (using the pricing information below) and assuming $0.00 down except for first month's payment.



Pricing Information:



MSRP: $35,610

Selling Price: $32,918



Thanks so much for all of your help. Your advice in this forum is great and very helpful!

CarMan@Edmunds · February 2005

Thanks for posting again, cstowe. You are correct, Audi is running a very attractive lease program on the A4 right now. This is in part to help dealers unload their remaining current models because the arrival of the completely redesigned version is right around the corner. Here is the info that you are looking for. If you were to lease a 2005 Audi A4 1.8T FWD through Audi Financial Services right now for 2 years with 15,000 miles per, its base lease money factor and residual value should be .00040 and 66%, respectively. The numbers for an otherwise identical lease of a 2005 Audi A4 3.0L FWD should be .00015 and 63%. If you were to lease these cars with only 12,000 miles per year, their residual values would be 2% higher. Vehicles' residual values are calculated based upon a percentage of their full MSRPs, including destination charges. You are absolutely right that one can and should negotiate the selling prices of leased vehicles. The lower the price you are able to negotiate is, the lower your car's lease payment will be. Just as a lower selling price will result in a low lease payment, so will a high residual value and a low lease money factor. A number of automakers have attractive lease programs right now. If you let me know what other cars you like I would be more than happy to tell you whether they have attractive lease programs available on them.

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CarMan@Edmunds · February 2005

Thanks jaykrue. Here is the informaiton that you are looking for. According to the latest informaiton that I have seen, if you were to lease a 2005 Acura TSX without navigation through American Honda Finance Corp. right now for 48 months with 12,000 miles per year, its base lease money factor and residual value should be .00210 and 52%, respectively. I would be more than happy to work up a sample lease payment on the car that you are interested in for you, however in order for me to do so I need you to tell me its its full MSRP, including destination. I suppose that the dealership that you are leasing your new vehicle form technically does not have to cut you a check for your trade instead of using its proceeds as a down payment on your lease. However, if you insist that they do so they would be dumb not to. If for some reason they won't, you can always sell your car on your own and get more money for it or sell it to a different dealer, like CarMax.

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CarMan@Edmunds · February 2005

Thank you ksd. I can give you an idea of what this truck's lease program is like right now. If you were to lease a base 2005 Jeep Grand Cherokee Laredo 4WD through Chrysler Financial at this time for 39 months with 12,000 miles per year, its base lease money factor and residual value should be .00197 and 54%, respectively. Interestingly, if you lease the same truck with any of the quick order option packages, the money factor increases to .00254, but the residual value remains the same. It is difficult to say why the web site that you visited came up with a lower lease payment for a 36 month lease of this truck then it did for a 39 month lease. I guarantee you that a 36 month lease of this model would definitely have a higher lease payment than a 39 month lease in real life. It sounds like the lease calculator that you were using used bad assumptions about this model's lease program. I don't know a formula that one can use to calculate a vehicle's lease money factor off of the top of my head, but you can back into an approximate money factor by playing around with the formula that is outlined in the following article: Calculate Your Own Lease Payment.

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CarMan@Edmunds · February 2005

Hi again ksd. You never mentioned the selling price or MSRP of the truck that you are interested in leasing. These are important number 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 truck'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 work up a sample lease payment on the Grand Cherokee that you are interested in for you if you let me know what these numbers are.

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CarMan@Edmunds · February 2005

Hey hpowders. unfortunately, the LS 430 is one of the few models that Lexus is not providing any sort of lease support on this month. As a result, if you were to lease one through Lexus Financial Services at this time, you would have to use its standard lease money factors. The last time that I saw it, LFS' base standard money factor for consumers who qualify for its "Tier 1" credit tier was .00205. The 3 year, 12,000 miles per residual value for a 2005 Lexus LS 430 without navigation is currently 58%. I have not seen this car's 10,000 miles per year residual.

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CarMan@Edmunds · February 2005

Thanks for taking the time to repost your earlier question, madmanager1. I would be more than happy to give you an idea of what this van's lease program is currently like. However, before I do so I need to tell you that General Motors Acceptance Corp. publishes what are known as lease rates instead of money factors for the vehicles that it leases. You can convert its published lease rates into approximate money factor equivalents by dividing them by 2400. OK, now onto the lease program. If you were to lease a 2005 Pontiac Montana SV6 through GMAC right now for 3 years with 15,000 miles per, its base lease rate and residual value should be 3.0% and 52%, respectively. The numbers for an otherwise identical 4 year lease of this van should be 3.0% and 45%. You are correct, GM is providing $1,500 customer cash on this van right now, but this money can not be used in conjunction with GMAC's lease program. You must have spoken to your dealer about this van in January because the owner loyalty program that you mentioned in your post is not available this month.

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CarMan@Edmunds · February 2005

Hi cstidham. Here is the informaiton that you are looking for. According to the latest information that I have seen, if you were to lease a 2005 Honda Pilot EX-L through American Honda Finance Corp. right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00154 and 58%, respectively.

I believe that Indiana is in Toyota's Chicago region. According to the latest info that I have seen for that area, if you were to lease a 2005 Toyota Highlander Limited 4WD through Toyota Financial Services for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00116 (for Tier 1 customers) and 56%, respectively.

Honda is not currently providing any cash incentives on the Pilot. Toyota does have customer cash on the Highlander, but this cash can not be combined with TFS' special lease program.

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CarMan@Edmunds · February 2005

You're very welcome, vishpool. As of Friday, Infiniti's February lease program for the 2005 FX35 had not changed since it was introduced. I would be more than happy to make some calls for you to see if anything new came out over the weekend. Please post a quick reminder in this discussion for me later on today and I will let you know what I have been able to find out.

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CarMan@Edmunds · February 2005

Vishpool, Infiniti Financial Services is fairly lenient in approving recent college graduates who are interested in financing or leasing a new Infiniti, but I do not believe that it currently has any cash incentives for recent grads.

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CarMan@Edmunds · February 2005

Thank you gwudc. Here is the informaiton that you are looking for. If you were to lease a 2005 Infiniti G35 coupe through Infiniti Financial Services right now for 36 months with 12,000 miles per year, its base lease money factor and residual value should be .00215 and 62%, respectively. The numbers for an otherwise identical 39 month lease should be .00215 and 61%. The numbers for an otherwise identical 42 month lease should be .00215 and 59%. Using these numbers, an MSRP of $35,610, and a selling price of $32,918, I come up with zero down, pre-tax monthly payments of around $420 for 36 months, $405 for 39 months, and $400 for 42 months.

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stalnaker · February 2005

Car_Man,



I can't decide whether to lease a 2004 Infiniti G35x or wait a while and lease a 2005 instead.



The lease on my Acura CL isn't up until April 30. But if I want to lease a 2004 G35x, I better do it before the end of February. Based on an offer from a dealer in Illinois, the 2004 would be $60.38/month less before tax compared to the 2005. But at the same time I would be making 2 car payments for 2 months, which has a cost of its own.



Is there any way to guess if the money factors on the 2005 might decrease or at least stay the same after the end of February? Right now the money factor for 36/15K on the 2005 G35x is 0.00172, and I don't believe there are any incentives on this car. If I could be assured of getting the same or a lower price, I might wait until my current lease is up. Otherwise I'm probably going to snatch up one of the 2004's while they are still around.



Is the money factor on the 2005 the same whether or not you pay the security deposit?

FYI, the best offer I have on a 2005 G35x w/Premium Package so far is $461.32/month plus tax with nothing down except first payment for 36 months/15K miles (MSRP $36,590; Sales price $33,571; Money factor 0.00172; Residual 58%).



Thanks!



Ernest

wifrbr · February 2005

Hello Car_Man,

I am looking to lease a 2005 VW Jetta GLS for 36-48 months, 12k miles. What are the residual values for the Jetta. Also do you know if they have any special lease deals going on now. I know the new 2006 Jetta comes out in about a month so I would think they would want to get rid of the 2005's

Thanks a lot,

ereynihc · February 2005

This is a Reposted reminder....

Welcome back.

Can you tell me the difference in offers/programs with a 2005 and the 2004? There is a 2004 demo FX35 with the options I want on the lot. It's MSRP is $35,777. However, I can also order a new 2005 with $40,730 MSRP. I haven't negotiated a selling price yet. (can suggest one) I'm trying to see the better deal for a 36/39 month lease with 15K miles.

Thanks.

cstowe · February 2005

Thanks for the info CarMan...

Questions:

Are the money factors you give only for the SE or is Audi putting them out on all A4s? If so then that opens up my options a bit since my local dealer only has two SEs on the lot.

As far as other models are concerned I guess I am very flexible in the type of car I drive, therfore I am more motivated by "the deal" rather than "the car"...so to re-phrase my question: Do you know of any other lease deals with a lower money factor, higher residual (24 or 36 mo), or a combination of both where the vehicle is in the 20-35K MSRP range? I would be open to SUVs as well.

Is that vague enough...?

kyfdx · February 2005

cstowe...

Chrysler Crossfire for $329/mo.?

rjbpa · February 2005

I posted this in the sales tax forum but didn't get a response.

In Pennsylvania, when you purchase a car you pay sales tax on the price paid less any trade-in. If you are leasing a car and trade it early when making a purchase, it works the same way. What happens it you turn in the car at the end of the lease and turn around and purchase something else? Is the sales tax calculated on the entire purchase price of the new vehicle?

euza · February 2005

Hi everybody

I think I got a good deal, any input is appreciated.

MSRP 32635, Invoice 29409, Sales Price 29000

Lease 36 months, 15k miles/year, residual 58%, money factor 0.00154.

Inception: $615 + First month

Pre-tax monthly payment: 360.46

jeff a · February 2005

Car Man,



Hope you had a good break.

I would like to lease an 2005 Acura MDX with both the NAV and the Rear Entertainment - with an MSRP of approximately $44,500. The dealer is quoting me $730/month with $1700 due at signing for a 3 year/15,000 contract. This seems at least $75 high to me, considering the money factors and residuals that I've seen. The sales manager has indicated that he has cut $2000 off MSRP, but I know there is another $2500 between MSRP and invoice. I want to give him a fair deal, but that would be $750 over invoice for me.



Can you please tell me what a reasonable lease payment should be on this vehicle?



Thank you very much.

drdze · February 2005

How does GMAC in NJ dispose of returned leased vehicles? My question is - if I return my cream-puff leased car (I know the VIN and maintenance history!) can I retrieve it from auction - I'm willing to bid well above the trade-in value which is just above 60% of the buyout price?

lmacmil · February 2005

How does one know if a dealer's lease quote is the same as the manufacturer's current offerings or if he had padded it (raised the money factor or reduced the residual)?

bs0 · February 2005

Hi,

I am thinking of leasing a 2005 Rav4 - can't decide between the 4x4 or 4x2 yet though.

With options, invoice price is $22363.

I haven't got detailed leasing quotes yet however. What should I be expecting for a 36 mth lease with a 12k/yr mileage allowance?

Thanks.

lycanthris · February 2005

One more time....

Can you provide me with MF and residual for an 05 Accord Ex w/leather (NO navi) for 36/12 and 36/15?

Finally made a decision, and will pick up this weekend, pending the final numbers from you.

THANKS!

snoopy3 · February 2005

I leased my 2002 Ford Explorer 3 years ago. It is a 5 year lease. My payments are too high at $526 a month. Is there any way to lower my payments and maybe buy the car? I wish I would have never leased, because I like the vehicle enough to keep it and I don't like trying to stick to the mileage rule.

lmacmil · February 2005

Anyone done this? Seems like a way to save a little and not get locked in for as long a period. Is there any reason not to do it if the financials are right?

kyfdx · February 2005

Check out swapalease.com.. You can find good deals, but they go fast.. If you are serious about it, you have to register, then check daily..

Usually, the best deals are where the lessee put a sizeable downpayment on the lease, but now needs out.. you can do pretty well, if you are savvy about leasing..

regards,

kyfdx

cjsot · February 2005

About to finalize a lease on a 745Li Msrp 80370 74700 sale price with .00125MF 10k miles compared to the leasing deal 799/mth with 5030 due at signing. I don't know if the 3500 down is part of the due at signing though. Hope your vacation was great!

rxke · February 2005

Hi CarMan

You were right with the Infiniti dealer adding to the money factor aside from charging MSRP because it is a new model. The salesperson said they would modify it when I was ready to deal. I am talking to other Infiniti dealers to see who will deal. What is the money factor and the residual for an RL in NY: 15,000 miles per year for 39 months? I received a quote for 12k and 39 months of 56% and .00235 with a purchase price of $47,500 with a monthly lease of around $685. I think that this is too high and will shop elsewhere. Your feedback would be appreciated.

cheng6991 · February 2005

I just agreed to lease 330Ci ZHP with Xenon. What do you think?

MSRP $42695

selling price $40640

NY leasing fee $995

first month and security deposit

Sales tax 8.25%

Monthly payment $532.00

vishpool · February 2005

I am a little confused about how sales tax works with leases. Everywhere online, even edmunds, the sales tax is said to be monthly payment * tax rate. But the dealers says its tax rate * the cap cost (or purchase price). Which one is correct? It doesn't make sense to pay taxes on the whole car, if you are only using 'part' of it.

jur · February 2005

I have never leased a vehicle and I am considering leasing a 2005 XC90. FOr $2,000 down, an XC90, five cyliner, with the Premium and Climate Package, Metallic paint and AWD, 10,000 miles per year for four years...a monthly payment of $500.00/four years. Is this a decent/good deal? I like the idea of getting a new car in four years since I generally hold onto my cars for at least six years. I know it is better to BUY the car if one plans to keep the car for many for many year, but I am very interested in your input and opinion on this lease offer. Thanks to all.

cmks02 · February 2005

Took delivery of a brand new '05 Lexus ES 330 on Saturday. During the delivery inspection I noticed a paint defect on the driver side C pillar. Color is black garnet pearl. Dealer now has the car and is going to wet sand to fix the defect. If that doesn't work, the C pillar area may have to be repainted.



Question 1 - Does wet sanding degrade the finish quality and durability assuming a 4 year lease. Will the wet sand area be more likely to be noticeable 3-4 years from now.



Question 2 - What about repainting the area. Can they do an exact match (this is a brand new car) and will the repainted area look just like the rest of the car 3-4 years from now.



Question 3 - If this was your new Lexus, would you agree to a wet sanding or a repaint of the affected area, or ask for a new car with no on delivery defects.



Please advise.

coby03 · February 2005

Car_man,

The 300C is back in the running. Dealer contacted me and said he'd go $500 over invoice. Along with the $1000 Chrysler Financing Bonus, I think it's a pretty good deal now and I'm likely going to pull the trigger. I have the 3 year/12k per year rates from you, but I noticed on the Chrysler site that the 39 month/12k per year rate seems much lower. Do you have the 39 month/12k per year MF and RV? Thanks.

sethi · February 2005

What a great forum...I had so many questions/doubts on leasing...this would be my virgin leasing experience, so pleas advise

Toyota is offering a lease on their Sienna minivan's (yes! I have a kid and parents to move around with) $250 per month with roughly $2000 down...I understand that by getting a lease I will have nothing left in hand at the end of 3 years etc...and am at peace with that. The same van Sienna LE with a 60 month plan costs $480 per month...

What I need reassurance on is the lease-end and the dreaded dealer-dance.

If TFS (Toyota Fin Svs) is underwriting the lease for me, are they going to make it difficult for me when I return the van. The dealer assured me that a few dings, marks on carpet, etc. will be overlooked...but if I believed a car salesman, then I have seen Elvis too.

So in your esteemed experience - Is leasing from a car leasing company any better in terms of pain and agony at the end of lease the lease term than the typical leasing from deler and their bank?

Thank you all for your words of wisdom for "Newbie Leaser"

namja007 · February 2005

Hello Car Man,

I am looking at two convertibles right now.

1)audi s4 cabriolet with 6 spd manual

2) bmw 330 cic with 6 spd manual

Looking to lease 3yr/ 15k per year

can you tell me the money factor and residuals on these autos

a)Also I was looking at the plain audi 3.0 cabriolet but they don't offer manual transmission ...do you know if they will offer a manual in new model ...it is a must for manual

b)when is the new audi a4s coming out (b7 model?) and will the s4 change as well

Sorry for all the questions but hope you can help......any additional tips will be appreciated with the audis......

CarMan@Edmunds · February 2005

Hi Ernest. It is difficult to predict what automakers will do with their future incentives programs with 100% accuracy. I can tell you that Infiniti's lease money factors on the 2005 G35 Sedan have improved since December. I suspect that Infiniti will continue to drop its money factors for this car in the coming months. Whether any reduction in this car's money factor is enough to offset the natural decline in residual values that vehicles experience as the model year progresses is difficult to say. If I had to make an educated guess, I would say that it will cost roughly the same to slightly less to lease an '05 G35 Sedan in two months as it would to do so right now. So, you will probably end up paying less if you lease a leftover '04 model, but you have to take those pesky remaining payments into account.

In answer to your question about security deposits. Yes, a security deposit is required to use the money factor that you mentioned in your post. Infiniti Financial Services will waive its lease security deposit requirement in exchange for an increase of .00015 in your vehicle's factor.

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CarMan@Edmunds · February 2005

Hello wifrbr. If you were to lease a 2005 Volkswagen Jetta GLS 2.0L Sedan through VW Credit right now for 36 months with 12,000 miles per year, its base lease money factor and residual value should be .00004 and 54%, respectively. The numbers for an otherwise identical 48 month lease of this car should be .00004 and 47%. This is an extremely low lease money factor so I definitely would consider this to be a special deal. In addition to this low factor, VW is providing $700 dealer cash on leases of this model through VW Credit. Make sure to take this cash into account when negotiating your car's selling price.

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CarMan@Edmunds · February 2005

Here is the information that you are looking for, ereynihc. If you were to lease a 2005 Infiniti FX35 AWD through Infiniti Financial Services right now for 36 months with 12,000 miles per year, its base lease money factor and residual value should be .00179 and 60%, respectively. The numbers for an otherwise identical lease of a 2004 model should be .00163 and 58%.

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CarMan@Edmunds · February 2005

You're welcome, cstowe. Audi is providing lease support on all 2005 Audi A4 models, but its exact factors vary by trim level and would not be exactly the same for a different A4. Similar vehicles that have attractive lease programs on them right now include all Saabs (the 9-2X, 9-3, & 9-5), some BMW 3-Series models, the Honda Accord (a less expensive car, but still very nice when loaded up), and Subaru Legacy to name a few, but the A4 has the lower money factors than most of these models.

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CarMan@Edmunds · February 2005

Hi rjbpa. While the methods for calculating sales tax vary from state to state, generally speaking if you just turn in your leased vehicle at the scheduled end of your lease you will not receive any sort of credit that would reduce the amount of sales tax that you would have to pay on your next new car or truck like you would if you were trading a vehicle in.

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CarMan@Edmunds · February 2005

Hi euza. The lease money factor and selling price that you were given on this truck are both very attractive. It sounds like you got a great deal to me. Enjoy your new Pilot

.

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CarMan@Edmunds · February 2005

I had a very nice break, thank you Jeff. Let's take a look at this truck's lease program and then work up a sample lease payment on it for you. According to the latest information that I have seen, if you were to lease a 2005 Acura MDX Touring with both the navigation and rear entertainment systems through American Honda Finance Corp. for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00196 and 57%, respectively. Using these numbers, an MSRP of $44,500 and a discount of $2,000 (selling price $42,500) I come up with a zero down, pre-tax monthly payment of right around $609. As you can see, something is definitely out of whack with the $730 payment that you were quoted, even if it includes tax and a waived security deposit. I definitely think that the dealer that you are working with is trying to add a little back-end profit to this deal, perhaps by marking up this truck's base lease money factor. You may want to try comparison shopping with another Acura dealer to see if they are willing to be more straightforward with you.

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CarMan@Edmunds · February 2005

Hi drdze. Once your off-lease vehicle leaves the dealer that you turn it in at, I suspect that it will be difficult for you to track down again. Have you tried placing a call directly to GMAC to see if they would be willing to negotiate your car or truck's lease-end purchase price. There's no guarantee that they will be willing to work with you, but you don't have anything to lose by asking.

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CarMan@Edmunds · February 2005

Hi lmacmil. To see how good a deal the lease that you were quoted is, all you have to do is ask your dealer the right questions. Specifically, find out the full MSRP, selling price, and money factor that were used to calculate the lease payment that you were quoted. Once you know these numbers, or even beforehand, do some research here at Edmunds.com to find out approximately how much you should be paying for this vehicle. Furthermore, you can see if the money factor that you were quoted is reasonable by simply asking me in this discussion. Armed with information on how much you should pay and what the lease program is like on the model that you want, you should be able to negotiate an attractive lease.

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CarMan@Edmunds · February 2005

Hello bs0. You never mentioned the selling price or MSRP of the RAV4 that you are interested in leasing. These are important number 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 truck'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 work up a sample lease payment on the RAV4 that you are interested in for you if you let me know what these numbers are. I also need to know what state you like in because Toyota's lease program varies depending upon which one of its twelve regions you are in.

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CarMan@Edmunds · February 2005

Hey lycanthris. You've picked a very nice car, especially for the money. If you were to lease a 2005 Honda Accord EX without leather or navigation through American Honda Finance Corp. right now for 3 years with 15,000 miles per, its base lease money factor and residual value should be .00118 and 53%, respectively. The money factor for an otherwise identical lease with only 12,000 miles per year would be the same, but the residual value would increase by 2%.

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CarMan@Edmunds · February 2005

Hi snoopy3. I am sorry to say that it is usually fairly expensive to get out of leases well before their scheduled end dates. In order to do so, you need to purchase the vehicle that you are currently leasing from the bank that you are leasing it through. It often turns out that it costs more to do so than your vehicle is worth on the open market. Furthermore, many banks expect consumers who end their leases early to still make all, or at least the depreciation portion of their remaining lease payments. As you can see, this can get very expensive.

You can determine approximately how much it will cost you to get out of your current lease by comparing its purchase price to its value on the open market at this time. You should place a call to the bank that you are leasing your vehicle through to find out its exact price. Once you know exactly how much money it is going to cost you to buy your leased vehicle you need to compare it to its current value on the open market. You can find out approximately what your vehicle is worth by looking up its Edmunds.com True Market Value in the Used Vehicle Pricing section of this site. You also may want to stop by the following discussion: "Real-World Trade-In Values". One of our most knowledgeable community members, Terry, frequents that discussion and he is often kind enough to give community members who give him an accurate description of their vehicles with his opinion on their value. Don't forget to check to see if you are still on the hook for your remaining lease payments. The difference between your leased vehicle's current value and how much it will cost you to buy it plus any remaining lease payments that you are obligated to pay will equal the cost of getting out of your lease right now. Even though your monthly payment on your Explorer is very high, you will probably find that you are better off waiting until you are closer to the scheduled end of your lease to get another new vehicle. If you really like your Explorer and definitely plan on purchasing it at the end of your lease, you don't have to worry about your mileage though because consumers who purchase their leased vehicles do not have to pay an excess mileage penalty.

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CarMan@Edmunds · February 2005

Thanks cjsot. The MSRP and selling price that you were quoted for this car seem reasonable to me. Also, the money factor that you were quoted is right in line with BMW FS' base factor for this car. The only problem that I have with the numbers that you mentioned is the large down payment. 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 leased 7-Series would be exactly the same, regardless of whether you had put $3,500 down, or had made absolutely no down payment at all.

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