Trying to figure fair price & lease payments for slightly used BMW X5 executive car

ccohen6410 · September 2020

So looking at two slightly used BMW X5s in South Florida. Looking to lease. The salesman said both of the cars had between 3400-4800 miles on them. Never gotten a slightly used executive car before. One is 2020 BMW X5 sDrive40i its MSRP pre options is $58,900. Its Carbon Black Metallic with luxury seating package, M Sport Package, Executive Package, 21" M Wheels, M Sport breaks, and a few other options that bring the total suggested retail price of $78,070.

The other car is also a 2020 BMW X5 sDrive40i. The base price is $58,900. The car is Artic Grey Metallic, with Black Vernasca Leather, Premium Package, and a few other options that bring the Total Suggested Retail Price to $67,270.

Looking at a 36 mo lease with 10,000 miles on it. Given they are slightly used with under $5,000 miles, how should i think about how this would be priced for a lease? What is the residual and money factor? What adj cap cost price should i shoot for and what monthly payments on the two cars? Thank you very much and if any other information is needed let me know and I will try to get it.

kyfdx · September 2020

ccohen6410 said:
So looking at two slightly used BMW X5s in South Florida. Looking to lease. The salesman said both of the cars had between 3400-4800 miles on them. Never gotten a slightly used executive car before. One is 2020 BMW X5 sDrive40i its MSRP pre options is $58,900. Its Carbon Black Metallic with luxury seating package, M Sport Package, Executive Package, 21" M Wheels, M Sport breaks, and a few other options that bring the total suggested retail price of $78,070.

The other car is also a 2020 BMW X5 sDrive40i. The base price is $58,900. The car is Artic Grey Metallic, with Black Vernasca Leather, Premium Package, and a few other options that bring the Total Suggested Retail Price to $67,270.

Looking at a 36 mo lease with 10,000 miles on it. Given they are slightly used with under $5,000 miles, how should i think about how this would be priced for a lease? What is the residual and money factor? What adj cap cost price should i shoot for and what monthly payments on the two cars? Thank you very much and if any other information is needed let me know and I will try to get it.

You should target 15%-18% off MSRP for a selling price.

.00099 MF and 55% residual
$500 lease credit

Subtract $0.25/mile from the calculated residual, to account for the current mileage.

ccohen6410 · September 2020

kyfdx thank you for getting back to me. I have several questions because some of it is circular. How do I figure out my monthly lease payments. In addition, i have several credits I am receiving. I got a letter from my local dealership saying I would get $3,988 toward a new lease ($2,000 BMW loyalty credit + $1,988 Preferred Customer Bonus from our local dealership). So lets take the X5 with the M package with a MSRP of $78,070 and let's assume it has 4,000 miles on it for a 36 month/10,000 mile year lease. So you say target 10-15% off. Let's split the middle and say we agree to 12.5% off or $68,311.25. From this i take my residual of 55% to get $37,571.19 (68,311.25 *.55). From this 35,571.19, i need to subtract $1,000 more for the 4,000 miles on the car (4,000 * $0.25). Then from the agreed upon sales price of $68,311.25 I would remove my $3,988 from this to get my "adj cap cost" correct. So this would be $64,313.25. Then the circular part. I know taxes and some other things get added to this. So how do i figure out what my monthly payment would be on these numbers? You wouldn't take the $64,313.25 and subtract the residual of $36,571.19 to get a monthly payment of $27,742.06 (or monthly depreciation of $770.61) and then the rent payment of ((64,313.25 + 36,571.19) * .00099) or $99.876 ($2.77 a month). Somehow my rental payment seems low but if i add the two $770.61 + 2.77 i get a pre tax monthly payment of $773.38. I know this is wrong but how would i figure a lease on these figures assume 7% sales tax in S FL and just paying first month and initial fees (to me that's where the circular comes in, you pay the first month which affects your adj cap cost but you need an adj cap cost, residual, etc to figure your first month). Thank you so much for your help

Michaell · September 2020

ccohen6410 said:
kyfdx thank you for getting back to me. I have several questions because some of it is circular. How do I figure out my monthly lease payments. In addition, i have several credits I am receiving. I got a letter from my local dealership saying I would get $3,988 toward a new lease ($2,000 BMW loyalty credit + $1,988 Preferred Customer Bonus from our local dealership). So lets take the X5 with the M package with a MSRP of $78,070 and let's assume it has 4,000 miles on it for a 36 month/10,000 mile year lease. So you say target 10-15% off. Let's split the middle and say we agree to 12.5% off or $68,311.25. From this i take my residual of 55% to get $37,571.19 (68,311.25 *.55). From this 35,571.19, i need to subtract $1,000 more for the 4,000 miles on the car (4,000 * $0.25). Then from the agreed upon sales price of $68,311.25 I would remove my $3,988 from this to get my "adj cap cost" correct. So this would be $64,313.25. Then the circular part. I know taxes and some other things get added to this. So how do i figure out what my monthly payment would be on these numbers? You wouldn't take the $64,313.25 and subtract the residual of $36,571.19 to get a monthly payment of $27,742.06 (or monthly depreciation of $770.61) and then the rent payment of ((64,313.25 + 36,571.19) * .00099) or $99.876 ($2.77 a month). Somehow my rental payment seems low but if i add the two $770.61 + 2.77 i get a pre tax monthly payment of $773.38. I know this is wrong but how would i figure a lease on these figures assume 7% sales tax in S FL and just paying first month and initial fees (to me that's where the circular comes in, you pay the first month which affects your adj cap cost but you need an adj cap cost, residual, etc to figure your first month). Thank you so much for your help

This article explains how to calculate a lease payment:
https://www.edmunds.com/car-leasing/calculate-your-own-lease-payment.html

And, my co-host recommended 15-18% off MSRP, not 10-15%.

ccohen6410 · September 2020

Michaell/Kyfdx, thank you for your help. So based on the following parameters is this fair lease payment and did i do this correct for a 10K/36 month lease on slightly used X5 with 4,000 miles? In addition to math being correct, are these parameters realistic/fair? Not sure if my fees of $2,200 to be added to the sales price are too high or too low? Thank you all for your help.

BMW 2020 X5 M package
MSRP= 78,070 given by dealership
Negotiated Sales price (18% off based on 15-18% parameters above)= $64,017.40
Not sure about fees for gross cap cost but lets say $2200 (including 1st month payment)
Cap cost reductions- get 3,998 in various credits ($2000 BMW loyalty credit, $1998 Preferred Customer credit from my particular dealership)
So adj cap cost= 64,017.40 + 2,200- 3,998= 62,219.40
Residual (4,000 miles on this car) = 78,070 * 55%= $42,938.50 less another $1,000 for the 4,000 miles at $0.25/mile = Total residual of $41,938.50

Depreciation charge (62,219.40 - 41,938.50)/36= $563.36
Rental charge (MF .00099)= (62,219.40 + 41,938.5) * .00099= $103.12
Total monthly payment pre-tax ($563.36 + $103.12)= $666.48
Total monthly w/sales tax (7%)= $713.13

kyfdx · September 2020

ccohen6410 said:
Michaell/Kyfdx, thank you for your help. So based on the following parameters is this fair lease payment and did i do this correct for a 10K/36 month lease on slightly used X5 with 4,000 miles? In addition to math being correct, are these parameters realistic/fair? Not sure if my fees of $2,200 to be added to the sales price are too high or too low? Thank you all for your help.

BMW 2020 X5 M package
MSRP= 78,070 given by dealership
Negotiated Sales price (18% off based on 15-18% parameters above)= $64,017.40
Not sure about fees for gross cap cost but lets say $2200 (including 1st month payment)
Cap cost reductions- get 3,998 in various credits ($2000 BMW loyalty credit, $1998 Preferred Customer credit from my particular dealership)
So adj cap cost= 64,017.40 + 2,200- 3,998= 62,219.40
Residual (4,000 miles on this car) = 78,070 * 55%= $42,938.50 less another $1,000 for the 4,000 miles at $0.25/mile = Total residual of $41,938.50

Depreciation charge (62,219.40 - 41,938.50)/36= $563.36
Rental charge (MF .00099)= (62,219.40 + 41,938.5) * .00099= $103.12
Total monthly payment pre-tax ($563.36 + $103.12)= $666.48
Total monthly w/sales tax (7%)= $713.13

Your math is good...

But, I don't know what your $1998 credit is actually worth. That could just be the discount they offer you. I don't think you'll get anything extra, after getting 18% off MSRP.

$2000 also isn't going to be enough to cover 1st payment and fees at most Florida dealerships.
$925 acquisition fee, $500 title/registration with some dealer padding, then a big, big dealer doc fee. Most dealers in Florida are $800-$1000 for dealer fees.

Don't be surprised if your quotes are in the $850-$950 range..

ccohen6410 · September 2020

Thank you. that makes sense. So one last question. Adding all those fees above pre 1st month payment is ~ $2,425. How is the total out of pocket upfront calculated as isn't it somewhat circular. It includes the first month's payment, but first month's payment is dependent on what the fees and stuff are added to the agreed upon sales price to get to the cap cost before cap cost reductions?

I have a letter from my dealership that if i come in during the month of September, they will give me $3,998 in credits toward lease of new BMW. Salesman doesn't know i have this so after I negotiate selling price (which i am targeting 18% off MSRP), I plan to spring it on him. I have gotten my last 8 cars from this dealership so given the relationship, i hope they honor it, otherwise I will be upset. Anyway, thanks again for the help and I will report what happens as I am going to the dealership in about an hour. Appreciate everyone's help so much

kyfdx · September 2020

ccohen6410 said:
Thank you. that makes sense. So one last question. Adding all those fees above pre 1st month payment is ~ $2,425. How is the total out of pocket upfront calculated as isn't it somewhat circular. It includes the first month's payment, but first month's payment is dependent on what the fees and stuff are added to the agreed upon sales price to get to the cap cost before cap cost reductions?

I have a letter from my dealership that if i come in during the month of September, they will give me $3,998 in credits toward lease of new BMW. Salesman doesn't know i have this so after I negotiate selling price (which i am targeting 18% off MSRP), I plan to spring it on him. I have gotten my last 8 cars from this dealership so given the relationship, i hope they honor it, otherwise I will be upset. Anyway, thanks again for the help and I will report what happens as I am going to the dealership in about an hour. Appreciate everyone's help so much

If you only want to make the first payment at signing, then add all the other costs to the adjusted CAP. Calculate the payment, then add the monthly tax.

Before you make any payment offers, or accept quotes, be sure to ask if that includes all fees.

I don't hold out much hope for your strategy, but good luck!

ccohen6410 · September 2020

So here is the deal I ended up going with. Seems pretty good. What do you all think? MSRP on 2020 X5 sDrive 40i with 33 miles for a 10k/36 month lease. MSRP $65,395. Agreed upon value of the Vehicle= $61,158.98.
Gross Cap Cost= $62,103.98
Capitalized cost reduction= $2,000
Adj Capitalized Cost= $60,103.98
Residual= $35,967.25
Depreciation charge= $24,136.73
Rent Charge= $4,461.31
Total of Base Monthly Payments= $28,598.04 or $794.39 per month
Total monthly payment (including 7% tax)= $850 per month

Thank you everyone for their help

Michaell · September 2020

ccohen6410 said:
So here is the deal I ended up going with. Seems pretty good. What do you all think? MSRP on 2020 X5 sDrive 40i with 33 miles for a 10k/36 month lease. MSRP $65,395. Agreed upon value of the Vehicle= $61,158.98.
Gross Cap Cost= $62,103.98
Capitalized cost reduction= $2,000
Adj Capitalized Cost= $60,103.98
Residual= $35,967.25
Depreciation charge= $24,136.73
Rent Charge= $4,461.31
Total of Base Monthly Payments= $28,598.04 or $794.39 per month
Total monthly payment (including 7% tax)= $850 per month

Thank you everyone for their help

Congrats!

Thanks for the report - and, pretty much in line with what my co-host predicted, at $850/mo.

ccohen6410 · September 2020

Yep. At the low end of his range so I am guessing its a decent deal. Would you guys say its a good deal or not? Thank you again

Michaell · September 2020

ccohen6410 said:
Yep. At the low end of his range so I am guessing its a decent deal. Would you guys say its a good deal or not? Thank you again

Given the lease program, you did fine.

ccohen6410 · September 2020

ok sorry but one more last question as i want to make sure i have my math correct before bringing it to the attention of the dealership. When we were done negotiating and salesman gave me the monthly payment, i asked him what my MF was. He said it was 0.00099 which matches what you all told me. I shoulda done the math myself when in the finance dept before signing but i didn't. Now normally that would be on me but since i have a good relationship with this dealership (is my 9th car from them), I want to bring it to the sales manager's attention assuming i am correct. When i got home and did the math, i come up with a MF of .00129. Is my math right? The rent charge on my lease is $4,461.31 and the residual and Adj Cap Cost add up to $96,071.23 (adj cap cost is $60,103.98 and residual is $35,967.25). If that is the case, my monthly payment should have been $28/mo lower. As i said not looking for them to do anything but since i know them, just want to bring it to their attention but want to make sure my math is right first- Thank you

kyfdx · September 2020

ccohen6410 said:
ok sorry but one more last question as i want to make sure i have my math correct before bringing it to the attention of the dealership. When we were done negotiating and salesman gave me the monthly payment, i asked him what my MF was. He said it was 0.00099 which matches what you all told me. I shoulda done the math myself when in the finance dept before signing but i didn't. Now normally that would be on me but since i have a good relationship with this dealership (is my 9th car from them), I want to bring it to the sales manager's attention assuming i am correct. When i got home and did the math, i come up with a MF of .00129. Is my math right? The rent charge on my lease is $4,461.31 and the residual and Adj Cap Cost add up to $96,071.23 (adj cap cost is $60,103.98 and residual is $35,967.25). If that is the case, my monthly payment should have been $28/mo lower. As i said not looking for them to do anything but since i know them, just want to bring it to their attention but want to make sure my math is right first- Thank you

Correct.. .00129 MF

If the salesman told you the MF was .00099, and they then marked it up, I would sure insist on them re-writing it with the base MF.

ccohen6410 · September 2020

Ok. I am going by the dealership now. But yes my wife was next to me and heard me ask and he did say .00099. He said he used the best rate as he assumed my credit was excellent (it is 826) but when i used the numbers in the contract, i got the .00129 MF. Before I made a stink and being a novice wanted to make sure my calculations were correct. Thank you

peroz18 · November 2020

Just out of curiosity... were you able to convince them to correct the MF after the fact?

Trying to figure fair price & lease payments for slightly used BMW X5 executive car

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