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View Poll Results: Did you lease your M3 with the intention of buying it at the end?
Yes, I leased with the intention to buy it! 25 51.02%
No, I just leased it just to lease it. 24 48.98%
Voters: 49. You may not vote on this poll

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      09-24-2012, 02:27 AM   #1
fongpi
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Leasing with the Intention to Buy

Hello Y'all,
How many people here leased their M3 knowing that they would choose to buy it when the lease comes up? It seems like a good option to shoot for since it gives the person leasing the car the option of "returning it." It doesn't seem like it's that much more in terms of cost to include this "option." So I'm surprised that it doesn't happen more often. Please share your thoughts on this!
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      09-24-2012, 02:34 AM   #2
dagolfpro
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Actually, leasing is much much more. You need to do the math and research.
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      09-24-2012, 02:45 AM   #3
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+1 you need to do the math and compare your lease payments, residual, etc vs the interest rate, loan, payment, etc on getting a regular loan. I did the calculations on my current 135i lease and I was actually only paying an extra 500$ or so through the lease lifetime instead of financing it as a purchase.

But I've known people that lease to be able to use it as a business expense and tax deduct it then buyout the car.
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      09-24-2012, 05:54 AM   #4
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It's usually more expensive to lease and buy out rather than just buying at the outset. There a number of factors that contribute so it depends on your particular situation. Sorry if that's not very helpful.
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      09-24-2012, 06:19 AM   #5
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Same here, for me it was way more costly to lease and buy out rather than simply buying from the outset. The lease rate for an M3 in Canada in 2008 was over 8%... I bought my car cash, so I condidered the "cost" of money at 2% in my calculations.

As others have said, you need to do the math to figure the best option. Every case is different, but usually leasing is more expensive.
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      09-24-2012, 09:11 AM   #6
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Quote:
Originally Posted by dagolfpro View Post
Actually, leasing is much much more.
Think this is pretty standard for leases. If you plan to buy at end of lease you're most likely better off just buying/financing now.
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      09-24-2012, 09:32 AM   #7
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Only lease if you are a 100% certain that you have no intention of keeping the car afterwards. Otherwise finance. If your gut is telling you that you really like this car and that it's been your dream car for a long time and you'd like to own it then finance it from the outset.

Leasing then purchasing the car afterwards just makes the dealership franchise owner more rich.
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      09-24-2012, 09:38 AM   #8
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99% of the time (possibly even 100%) it is cheaper to just buy it in the first place.

The company leasing you the car assumes the risk of finding a buyer at end of lease. That risk is reflected in your price.
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      09-24-2012, 10:06 AM   #9
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when i did my calculations, it was only around 3k more to buy out my lease compared to financing from the begining ..

i am still not sure if i want to buy it out, so having that option available at the end helps..
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      09-24-2012, 10:18 AM   #10
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cheaper to buy than lease... well last time i calculated was back in early 2009... lol
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      09-24-2012, 10:27 AM   #11
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Quote:
Originally Posted by Philip@McKennaPerformance View Post
+1 you need to do the math and compare your lease payments, residual, etc vs the interest rate, loan, payment, etc on getting a regular loan. I did the calculations on my current 135i lease and I was actually only paying an extra 500$ or so through the lease lifetime instead of financing it as a purchase.

But I've known people that lease to be able to use it as a business expense and tax deduct it then buyout the car.
I leased my car only because I can deduct the business expense for the lease. I do also plan on buying at this car is just too good not to. I did the same thing with my 1999 E36 and kept it 12 years with 182,xxx miles on it. If you do plan on leasing pay the extra MSD to reduce your money factor. If you don't know what MSD, do a search on this forum. You'll thank me later.
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      09-24-2012, 11:40 AM   #12
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I leased not knowing whether I would buy it or not. So neither poll option applies.

A number of factors went into my decision, ultimately, to buy it off lease (which, incidentally, I just did early and well prior to lease expiration). I wanted to see the F30 and 'listen' to the rumors about the F80/F82, especially the engine, I wanted to drive mine for awhile to make sure it had no bugs, rattles, recurring problems, etc. (it did not), I wanted to spend some time in a 335i to judge the turbo lag (yes I realize the F80/82 may or may not have the same amount of turbo lag given the different configuration), I wanted to think a bit about the NA versus FI option and I wanted to make sure I was into the long term relationship with my car. And with a second DD (a Jeep Wrangler) I was able to keep the miles on my M3 very low but still enjoy it.

And I was willing to pay the lease versus buy premium to have these things.

Yes I realize much of this sounds like dating...

But now I own mine and could not be happier.
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      09-24-2012, 12:07 PM   #13
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Quote:
Originally Posted by dagolfpro View Post
Actually, leasing is much much more. You need to do the math and research.
^^

Bingo! Just finance the damn thing and save yourself some money in the long run.
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      09-25-2012, 10:52 AM   #14
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I leased with the intent to drive my baby real hard and, if something bad were to happen (e.g. medium accident), have the option of giving her up and getting something new to play with.
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      09-25-2012, 10:57 AM   #15
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Need a new option.......leased and have now discovered how great this car is and couldn't dare give it back . Oh yeah....all the modding doesn't help either.............Phil
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      09-25-2012, 11:00 AM   #16
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Quote:
Originally Posted by NoM3ForMe View Post
^^

Bingo! Just finance the damn thing and save yourself some money in the long run.
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      09-25-2012, 11:03 AM   #17
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the second reason-notice how i said second and not first-that I lease a vehicle, especially high-end cars like the M3, is due to the fact that reliability is a common concern. If I notice the vehicle is at the BMW dealer being serviced quite often, I just turn it in, and never look back.
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      09-25-2012, 11:38 AM   #18
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I'm looking at getting the 2014 m3 and was seriously considering doing the same thing. Don't know if it is a good or bad idea.
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      10-16-2012, 03:18 AM   #19
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I'm looking at getting the 2014 m3 and was seriously considering doing the same thing. Don't know if it is a good or bad idea.
I think there may be a few bugs to iron put in the 2014, whereas the 2013 will be the best e9x ever made!
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      10-16-2012, 07:27 AM   #20
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Yes, leasing is a bit more dollars over the life of the lease versus buying when you look just at simple dollars, but it's more complicated than just straight dollars. I ran the numbers out before I jumped in back in '09. I ran two scenarios:

-Buy the car, 3 year loan, sell the car at the end of the three years for "market" value, so I could refresh and stay in a current car. (Remember though, many people will finance the car over 5 years to lower the payment, but that makes the car cost more in the long run. So that's the first way the dollar gap closes between lease and buy.)
-Lease the car for 3 years. Turn car in at end of lease, move on.

In those two scenarios above, leasing was more expensive by about $3000-4000. However, it's NOT that simple. On the owning side, if the car is a problem car, or it gets damaged while you own it, or the market climate is bad for selling a car like an M3, you will not be able to get the ideal "market" value you calculated and planned on, and the difference of dollars between leasing and buying evaporates quickly. Look at the used M3 market, are people getting top dollar for E9x M3's? No. And it will get way worse when the next M3 generation arrives. With leasing, you walk back to the dealer, hand them the keys and walk away if you want to.

Some reasons I leased at first:

-These are complex cars. Things can go wrong. Generally, you'll know in the first two years if it's a problem car. If it is a problem car, and you own it, selling it will be hard and you won't get the "market" value, which increases the net cost to own it.

-You can always buy the car before the lease is over and save all those expensive money factor payments. That's what I did. My M3 was trouble free and I loved it, so I decided to buy the car 7 months before the lease was done. The effective rate on the car was over 8% during the lease. The loan to buy was around 3%. I added all kinds of wheel and tire insurances, extended warranty and other stuff and my payment still went down when I bought it. (In my wife's leased X5 case, the X5 didn't have a few features we wanted, so we ordered a new one with the options we wanted, leased that and turned in the keys to the old lease. No fuss no muss.)

-This was my first M, and I didn't know if I'd want to keep it, or keep refreshing to a new M each time they came out. The flexibility made it stress free.

-If you own a business, a business lease is great for many reasons---write offs, etc.

Ultimately, I think leasing expensive cars is good way to give you some peace of mind that you're not stuck with an expensive machine if you don't like it, or it has problems, or it gets damaged. The extra few dollars are far offset by the convenience, assurance and peace of mind. How many people here have sold a used car? That's just not fun---endless emails, phone calls, PM's, and test drives with odd strangers, low-balls, lack of interest. And remember, specifically with an M car, people assume that the car has been abused, so they don't want to pay "market" value.

In the end, owning a car can be great, but with such complex cars, it is nice to have an option to hedge your bets. Leasing is the way to start in my book. If you have the car for a year and it's great, then jump in and buy it. The few extra dollars---if it even ends up really being more---are worth it to me. My only advice at lease time is to make sure you get as great a selling price as you can, because if you buy the car later, it's price is the residual percentage based off the selling price.

Now, if you said, "I'm paying cash and going to keep the car for 10 years....", I guess you can just go ahead and buy it, but how many people go into an M car saying that?

Now that I bought mine and have been modding it, I really enjoy the car and plan on keeping it for quite awhile. The way my car is setup now (VF620, JRZ RS Pro, AP Racing), I'm not worried about what BMW is going to produce next because I like how my car looks (I don't really care for the new 3 series look), and I know it will easily outperform whatever the next M is---unless BMW decides to drop 600+hp in the next M.....hahaha yeah right.
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      10-16-2012, 08:16 AM   #21
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Quote:
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I leased with the intent to drive my baby real hard and, if something bad were to happen (e.g. medium accident), have the option of giving her up and getting something new to play with.
I agree with this ...but moreso having a "lemon" type of situation which has happened to me with german cars in the past...

Its a chance to not have to try to sell your way out of a car. If the car is awesome for all 3 years of the lease then I may buy it out...or my father may by it out for himself.
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      10-16-2012, 08:28 AM   #22
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IMO lease is just a little or no $ down loan at the dealer's interest rate that just disappears after three years. You can get a low downpayment loan at lower interest rate in most cases from your bank. Get insurance so loan is covered in case of loss of vehicle and sell privately when you want to.
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