BMW Garage BMW Meets Register Search Today's Posts Mark Forums Read
BMW M2 Forum > Pricing / Ordering / European Delivery / PCD > Lease Help - About to Walk

Post Reply
 
Thread Tools Search this Thread
      01-13-2017, 04:50 PM   #1
Vintage
Colonel
Vintage's Avatar
United_States
378
Rep
2,588
Posts

Drives: BMW G80 (MT), 718 Spyder
Join Date: Aug 2009
Location: Austin, Texas

iTrader: (0)

Lease Help - About to Walk

MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.
Appreciate 0
      01-13-2017, 04:58 PM   #2
Msmall143
Lieutenant
269
Rep
486
Posts

Drives: BMW M4, BMW S1000RR
Join Date: Mar 2016
Location: Loudon VA

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.
it is higher payments but you'll end up with equity at the end. or look at m3/m4 leases, probably pretty close in terms of payment
Appreciate 0
      01-13-2017, 07:08 PM   #3
MRCUR
Lieutenant Colonel
MRCUR's Avatar
United_States
822
Rep
1,779
Posts

Drives: 2018 Model 3 Performance
Join Date: Oct 2014
Location: PA

iTrader: (0)

The residual is set by BMW, not the dealer. You're getting 15k miles which is the lowest residual for 36 months.

The MF is being marked up to the max allowed by BMW. You should negotiate that to be the buy rate of .00134.
Appreciate 0
      01-13-2017, 10:53 PM   #4
doug_999
Brigadier General
doug_999's Avatar
2539
Rep
3,967
Posts

Drives: 2011 1M/2021 992/2023 X3
Join Date: Mar 2008
Location: Chicago, IL

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.
Talk to your accountant. Leasing vs buying is very similar for a company owned car. The buy route gets the write off at the end vs during. Nobody should lease the M2.
__________________
2011 1M, Black loaded sans sat radio
2021 911 C4S Gentian Blue, manual
2023 X3 M40i - loaded sans Park Assist
Appreciate 3
buddalun678.00
Y148.00
      01-14-2017, 06:46 AM   #5
Vintage
Colonel
Vintage's Avatar
United_States
378
Rep
2,588
Posts

Drives: BMW G80 (MT), 718 Spyder
Join Date: Aug 2009
Location: Austin, Texas

iTrader: (0)

Thanks for the help guys/gals. I will do the following: 1) negotiate MF down while also 2) consulting with our firm accountant on lease v. buy prference.
Appreciate 0
      01-14-2017, 09:36 AM   #6
rich8566
Major
rich8566's Avatar
United_States
609
Rep
1,124
Posts

Drives: M2 + Z-4
Join Date: Sep 2007
Location: FL

iTrader: (0)

Garage List
2014 BMW M235i  [0.00]
Quote:
Originally Posted by Msmall143 View Post
Quote:
Originally Posted by Vintage View Post
MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.
it is higher payments but you'll end up with equity at the end. or look at m3/m4 leases, probably pretty close in terms of payment
There's no equity build up in a lease, but there is a theoretical build up in value. But that's a crapshoot since you would need to buy out the car at the end of the lease, pay the sales tax on the "value" of the car, and then find a willing buyer. The cost of the sales tax alone could be enough of a transactional cost to be a deal killer right up front.

On the other hand, if you intend to buy out your own car, then yes, there is in theory an equity build up - but again, that's a crapshoot too. What if you've had a fender bender, etc- do you really want to own that car after lease end?
Attached Images
 
__________________
Current: 2017 ///M2 manual 2004 E85 Z-4 manual
Appreciate 0
      01-14-2017, 09:41 AM   #7
rich8566
Major
rich8566's Avatar
United_States
609
Rep
1,124
Posts

Drives: M2 + Z-4
Join Date: Sep 2007
Location: FL

iTrader: (0)

Garage List
2014 BMW M235i  [0.00]
Quote:
Originally Posted by doug_999 View Post
Quote:
Originally Posted by Vintage View Post
MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.
Talk to your accountant. Leasing vs buying is very similar for a company owned car. The buy route gets the write off at the end vs during. Nobody should lease the M2.
I would disagree. My strategy on leasing is that I use it as a three year test drive. If I really, really like the car, and if it has no damage, and if it has been and is expected to be reliable, I will consider buying it. Yes, there is the added cost of the lease bank fee, but at least I don't pay the sales tax on the entire value of the car up front. So in the long run, leasing, even with a low (aka non subsidized) residual is not necessarily more expensive that an outright purchase.
Attached Images
 
__________________
Current: 2017 ///M2 manual 2004 E85 Z-4 manual
Appreciate 0
      01-14-2017, 11:06 AM   #8
doug_999
Brigadier General
doug_999's Avatar
2539
Rep
3,967
Posts

Drives: 2011 1M/2021 992/2023 X3
Join Date: Mar 2008
Location: Chicago, IL

iTrader: (0)

Quote:
Originally Posted by rich8566 View Post
I would disagree. My strategy on leasing is that I use it as a three year test drive. If I really, really like the car, and if it has no damage, and if it has been and is expected to be reliable, I will consider buying it. Yes, there is the added cost of the lease bank fee, but at least I don't pay the sales tax on the entire value of the car up front. So in the long run, leasing, even with a low (aka non subsidized) residual is not necessarily more expensive that an outright purchase.
It is more expensive to lease the M2 than to purchase. The current residual is below 50% right now (46% for 15K/3 years) with the 240 being 9% higher in terms of residuals.

So if you were to lease the M2, you would end up paying off about $30K in depreciation (plus the finance charges on the remaining $25K) and at a higher interest rate than buying. The car will be worth more than $25K at the end of 3 years (crystal ball on this one says so ) and so you just spent a bunch more money than you needed to - plus you are locked in for the lease period with very little flexibility. It simply is not a good financial move, no matter what.

The opposite of course is true with a high dollar, highly optioned, and good residual car. Take a M3 where leasing makes a lot more sense - especially at 14% points higher residual

or on my 650xi....that worked out very well in terms of a lease as well
__________________
2011 1M, Black loaded sans sat radio
2021 911 C4S Gentian Blue, manual
2023 X3 M40i - loaded sans Park Assist
Appreciate 2
zenmaster1574.50
      01-14-2017, 12:33 PM   #9
Vintage
Colonel
Vintage's Avatar
United_States
378
Rep
2,588
Posts

Drives: BMW G80 (MT), 718 Spyder
Join Date: Aug 2009
Location: Austin, Texas

iTrader: (0)

and my salesman just threw out the "balloon" loan/payment option but interest rate of 4.9% is silly high, so I said no

not looking good
Appreciate 0
      01-14-2017, 01:08 PM   #10
QM
First Lieutenant
United_States
287
Rep
312
Posts

Drives: 2020 M2CS 6MT
Join Date: Oct 2015
Location: Illinois

iTrader: (2)

If you do decide to buy, you can get better rates from a credit union. They'll cut you a check that you can take to the dealer and see if they can beat the CU rate. Give yourself a few days to arrange it prior to picking up the car. My dealer couldn't beat the CU rates (and I have perfect credit), so I ended up using the CU check/financing. The ballon option didn't make sense either as payment was the same as the lease at their rate.
Appreciate 0
      01-14-2017, 01:15 PM   #11
M2taz
Private First Class
M2taz's Avatar
United_States
82
Rep
120
Posts

Drives: X5 50i
Join Date: Nov 2016
Location: Denver

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
and my salesman just threw out the "balloon" loan/payment option but interest rate of 4.9% is silly high, so I said no

not looking good
PenFed also offers ballon's or they call them payment saver at much better rates than 4.9%. https://www.penfed.org/Payment-Saver-Auto-Loan/
Appreciate 0
      01-14-2017, 01:26 PM   #12
atxsk8r
Major
atxsk8r's Avatar
United_States
1569
Rep
1,298
Posts

Drives: 2020M2C
Join Date: Dec 2015
Location: Austin, Tx

iTrader: (0)

Quote:
Originally Posted by QM View Post
If you do decide to buy, you can get better rates from a credit union. They'll cut you a check that you can take to the dealer and see if they can beat the CU rate. Give yourself a few days to arrange it prior to picking up the car. My dealer couldn't beat the CU rates (and I have perfect credit), so I ended up using the CU check/financing. The ballon option didn't make sense either as payment was the same as the lease at their rate.
Credit Union is the way to go for the M2. Thats what i did and got 1.59.

And leasing is a no no on the M2, rates still suck and probably will keep sucking. If you wanna lease, get M3/M4.
Appreciate 1
      01-14-2017, 01:56 PM   #13
bimmer4life24
Lieutenant
bimmer4life24's Avatar
United_States
266
Rep
505
Posts

Drives: 2020 M2 Comp
Join Date: Jan 2010
Location: Chicago

iTrader: (1)

OP, the tax credit is MUCH better on a buy vs a lease. When buying, almost the entire sale price of the car gets deducted off your taxes. I do it every year and it helps A LOT! As far as financing, look into penfed. They are currently offering 2.9% for 84 months! Then tell your dealership to match that rate otherwise they lose on financing.

Also, if you are worried about not liking the car, you STILL have better value buying it because look at the resale value of the M2. It is a limited car that is hard to find so I believe resale values will continue to stay high.

Leasing is a big no no on the M2.
Appreciate 1
      01-14-2017, 03:17 PM   #14
pruettfan
Brigadier General
1622
Rep
3,402
Posts

Drives: 2017 M2, LBB, DCT, Exec
Join Date: Jul 2009
Location: Chandler, AZ

iTrader: (0)

Lease terms on the M2 suck because BMW doesn't want to take depreciation risk to move these cars, fact is they don't have to take any risks to move them. There is a lot of discussion in the industry about captive lenders taking on depreciation risk given the flood of lease returns that they are expecting in the coming years. For the last few years the manufactures have been wiling to bet on higher residuals to make leasing more attractive but leasing has grown so much that they are now worried that when these cars come back there will be more cars than buyers resulting in a bit of a fire sale. BMW is one of those that has talked about reexamining their lease terms so it seems the M2 is one of those cases. I can't say I blame them, they can move these cars easily through regular sales and not take any risk at all plus its a low volume niche car so its not going to make or break them.

I was thinking I would lease if terms were similar to that of the M3 but as soon as I saw the residual they were offering I was out on a lease and just bought it. I agree with those above to suggest Penfed, they have a couple of desirable low interest options that are worth considering and have excellent customer service.
Appreciate 1
      01-14-2017, 03:54 PM   #15
///MIKE M
First Lieutenant
207
Rep
343
Posts

Drives: 2016 LBB M2
Join Date: Feb 2016
Location: NJ

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
and my salesman just threw out the "balloon" loan/payment option but interest rate of 4.9% is silly high, so I said no

not looking good
4.9??

I did BMW select with the balloon and it was 2.99.

Maybe they are trying to screw you the same way they screwed with the MF. I personally wouldn't do business with a dealer that plays with those numbers on me. Yes the lease residuals are horrible, but that's through BMW. Trying to get more money out of you through those means would anger me and it's probably amazing the amount of people they get who don't know what the number should be and just sign....

Look for available allocations in the pricing thread. And post up the name of this dealer. For me the practice of playing with those numbers is worse than a dealer markup because they aren't hiding it on you. At least they are honest about trying to screw you hahaha

Good luck with the car. It sure is worth it.

From what I've read on here look into PenFed for a slightly better balloon type of rate as well.
Appreciate 0
      01-14-2017, 06:10 PM   #16
M3 Adjuster
Banned
Albania
7905
Rep
11,785
Posts

Drives: 1M, X1 M Sport, E46 325ic
Join Date: Mar 2008
Location: Dallas, Tx

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.



If you are on this forum .. How you even got to the negotiating table and didn't know this in advance, I have no idea ..

There has been a lease thread with this advice in it for over a year on here.

This is an enthusiast car and it is not meant to be sold to corporate entities and treated like it's a 550 sedan.

BMW doesn't want people leasing this car and trashing it and turning it back in 36 months later like a program car for them to try and sell off for you.

Therefore the residual and money factors are set so that it's incredibly unattractive to lease.

If all you are wanting is a lease car then F%#k off and lease an M3/M4. Do not lease the M2, give up the allocation to someone who wants to own and cherish it and is willing to pay their own hard earned money for it.
Appreciate 3
atxsk8r1568.50
Y148.00
      01-15-2017, 07:34 AM   #17
ACZakka325i
Colonel
ACZakka325i's Avatar
276
Rep
2,008
Posts

Drives: 2 stroke
Join Date: Jul 2005
Location: CT

iTrader: (2)

Quote:
Originally Posted by M3 Adjuster View Post
Quote:
Originally Posted by Vintage View Post
MSRP
36 months
15k miles per year
46% residual
.00174 MF

This seems terrible on residual and MF . . . right? I am about to walk a M2 over a BAD lease deal. Am I crazy?

Any suggestions other than BUY IT. This is a work lease, but since I own the business I would still like it to be a decent deal. Thanks.



If you are on this forum .. How you even got to the negotiating table and didn't know this in advance, I have no idea ..

There has been a lease thread with this advice in it for over a year on here.

This is an enthusiast car and it is not meant to be sold to corporate entities and treated like it's a 550 sedan.

BMW doesn't want people leasing this car and trashing it and turning it back in 36 months later like a program car for them to try and sell off for you.

Therefore the residual and money factors are set so that it's incredibly unattractive to lease.

If all you are wanting is a lease car then F%#k off and lease an M3/M4. Do not lease the M2, give up the allocation to someone who wants to own and cherish it and is willing to pay their own hard earned money for it.
Relax Francis.....

You come off incredibly self-righteous. This is a $50k Bmw we are talking about. Try to keep that in perspective.
__________________
(Waitlist): #1 M2CSL
(Current): 2016 F15 X5 3.5xdrive - 2010 997.2 C4S Coupe
(Past): 2016 F30 340xi M-Sport -2013 535i xdrive
2008 E92 M3 - 2006 E90 325i
2002 E46 325xi - 1991 E30 325i
Appreciate 1
doug_9992538.50
      01-15-2017, 09:12 AM   #18
Vintage
Colonel
Vintage's Avatar
United_States
378
Rep
2,588
Posts

Drives: BMW G80 (MT), 718 Spyder
Join Date: Aug 2009
Location: Austin, Texas

iTrader: (0)

The M2 would be my 9th BMW and I am 44 years old (should have never sold my 2001 M Coupe in 2006, the only one I regret letting go - my favorite of all time). I am a BMWCCA and PCA member and I track my cars OFTEN. Sorry that I OWN a GT4 and Viper ACR-E that actually do what they were intended to do, and yes, an M2 inbound plus an i3, 535d, and VW GTI and others that I want for whatever reason. This is America - god bless it.

I will buy or lease whatever I want and I love the M2 if I go ahead on it as I passed on 2 other M2s at this dealer already do to how they were equipped; I have driven it at the dealer twice. Passed on an offered M4GTS at this dealer because just didn't fall in love with it and wanted someone else to have it - now some collector probably has it rotting for speculation or going to cars & coffee . . . . which is his or her right although it does hurt. You might also note my avatar, a 1976 R90/6 that is my baby and 5th BMW vintage motorcycle - I have had that one 12 years.

So general, that may not be enough street cred for you as you may be the "great BMW decider" or I may not qualify as an ENTHUSIAST in your mind, but I don't care. I was just asking the helpful M2 owners on this thread about the best approach for the business I own to lease or purchase me a car. My plan was to lease and then purchase at lease end. I needed the advice to help clear my head on the best way to acquire the vehicle - the above discussion has really helped. My gratitude to all for your time and advice.

If we met in person, I would like to think we would be friends. This is my first negative experience on BIMMERPOST in the 7+ years I have been on board. So I will chalk it up to a bad day. M3 Adjuster, I hope tomorrow is a better day for you, truly. Hopefully we get to meet in person at a track and I can shake your hand. Right now the Viper is seeing the bulk of that duty, it is big, loud, white with a black and red stripe and the number 87 on the side of it. Please come say hello and I will buy you a beer after the event!
Appreciate 4
hoyasaxa686.50
QM287.00
bollinm25.00
      01-15-2017, 10:09 AM   #19
atxsk8r
Major
atxsk8r's Avatar
United_States
1569
Rep
1,298
Posts

Drives: 2020M2C
Join Date: Dec 2015
Location: Austin, Tx

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
My plan was to lease and then purchase at lease end.
Ah, should of mentioned this in OP

If this is the way you're thinking, might as well buy from the start, will have cheaper payments and save money throughout the whole buying purchase.
Appreciate 0
      01-15-2017, 10:43 AM   #20
mercedesc63
Captain
mercedesc63's Avatar
United_States
256
Rep
928
Posts

Drives: 02 BMW Z3M Coupe S54 Slicktop
Join Date: Feb 2014
Location: San Diego

iTrader: (1)

Quote:
Originally Posted by Vintage View Post
and my salesman just threw out the "balloon" loan/payment option but interest rate of 4.9% is silly high, so I said no

not looking good
You need to go to your own bank for a loan I got like somewhere between 1.5-3% from my bank..

I would try to get at least 3k off Msrp. The resale value should be pretty solid if you decide to sell in the next 2 years.
__________________
Gone but not forgotten:
2007 E63 M6 SMG, 1999 996 Carrera Cab AT, 2007 & 2008 E90 335xi AT, 2011 E93 M3 DCT, 2X 2002 E46 M3 SMG & 6MT, 2016 F80 M3 DCT
Appreciate 0
      01-15-2017, 10:49 AM   #21
M3 Adjuster
Banned
Albania
7905
Rep
11,785
Posts

Drives: 1M, X1 M Sport, E46 325ic
Join Date: Mar 2008
Location: Dallas, Tx

iTrader: (0)

Quote:
Originally Posted by Vintage View Post
The M2 would be my 9th BMW and I am 44 years old (should have never sold my 2001 M Coupe in 2006, the only one I regret letting go - my favorite of all time). I am a BMWCCA and PCA member and I track my cars OFTEN. Sorry that I OWN a GT4 and Viper ACR-E that actually do what they were intended to do, and yes, an M2 inbound plus an i3, 535d, and VW GTI and others that I want for whatever reason. This is America - god bless it.

I will buy or lease whatever I want and I love the M2 if I go ahead on it as I passed on 2 other M2s at this dealer already do to how they were equipped; I have driven it at the dealer twice. Passed on an offered M4GTS at this dealer because just didn't fall in love with it and wanted someone else to have it - now some collector probably has it rotting for speculation or going to cars & coffee . . . . which is his or her right although it does hurt. You might also note my avatar, a 1976 R90/6 that is my baby and 5th BMW vintage motorcycle - I have had that one 12 years.

So general, that may not be enough street cred for you as you may be the "great BMW decider" or I may not qualify as an ENTHUSIAST in your mind, but I don't care. I was just asking the helpful M2 owners on this thread about the best approach for the business I own to lease or purchase me a car. My plan was to lease and then purchase at lease end. I needed the advice to help clear my head on the best way to acquire the vehicle - the above discussion has really helped. My gratitude to all for your time and advice.

If we met in person, I would like to think we would be friends. This is my first negative experience on BIMMERPOST in the 7+ years I have been on board. So I will chalk it up to a bad day. M3 Adjuster, I hope tomorrow is a better day for you, truly. Hopefully we get to meet in person at a track and I can shake your hand. Right now the Viper is seeing the bulk of that duty, it is big, loud, white with a black and red stripe and the number 87 on the side of it. Please come say hello and I will buy you a beer after the event!

Walk on an M2 over a business deal?

I would absolutely do so .. but only Right after you finish mixing business with pleasure and buy an M2 because you *want the car *


After you pick up the M2 come give me a call and I'll give you your "enthusiast card " back .. it's been temporarily revoked !!
Appreciate 0
      01-15-2017, 02:11 PM   #22
Vintage
Colonel
Vintage's Avatar
United_States
378
Rep
2,588
Posts

Drives: BMW G80 (MT), 718 Spyder
Join Date: Aug 2009
Location: Austin, Texas

iTrader: (0)

Quote:
Originally Posted by M3 Adjuster View Post
Walk on an M2 over a business deal?

I would absolutely do so .. but only Right after you finish mixing business with pleasure and buy an M2 because you *want the car *


After you pick up the M2 come give me a call and I'll give you your "enthusiast card " back .. it's been temporarily revoked !!
Thanks - it IS the right color at least - AW!!! And let's all remember that there are significant income/tax advantages to having my company lease it for me; I was just trying to have it all. . . . .
Appreciate 1
Post Reply

Bookmarks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off



All times are GMT -5. The time now is 08:44 AM.




m2
Powered by vBulletin® Version 3.8.11
Copyright ©2000 - 2024, vBulletin Solutions Inc.
1Addicts.com, BIMMERPOST.com, E90Post.com, F30Post.com, M3Post.com, ZPost.com, 5Post.com, 6Post.com, 7Post.com, XBimmers.com logo and trademark are properties of BIMMERPOST