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      04-19-2013, 09:53 PM   #1
CiprianS
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Differences between lease and owner's choice

Can you please tell me guys which are the differences between lease and owner's choice? I got a deal for a BMW M3 and I don't know what to get out of this two, which are the advantages and disadvantages of them? Thank you.
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      04-20-2013, 12:47 AM   #2
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Lease is a lease, you are paying for the depreciation of the car over the life of the lease. You can choose to purchase the car at the end of the lease for the residual value. You do not own the car with a lease.

Owner's choice is another form of financing. You have reduced monthly payment compared to a 5 year amortization, the downside is you have a balloon payment at the end of 3 (i think) years. You can pay this ballon payment in full or refinance. You own the car with an owner's choice.

Pick your poison.

Also mandatory:
http://www.xbimmers.com/forums/showthread.php?t=497749
http://www.m3post.com/forums/showthread.php?t=479361
http://www.m3post.com/forums/showthread.php?t=248778
http://www.m3post.com/forums/showthread.php?t=498944
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      04-20-2013, 12:55 AM   #3
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you wanna own the car past 3 years ?
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      04-20-2013, 05:29 AM   #4
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I have something similar to owner's choice with Pen Fed. 5 year balloon, 1.74% interest. In a lease you are free to walk away at end of term. With owner's choice, you can keep and pay the balloon, sell and pay the balloon or trade and pay the balloon. If the value is less than the balloon payment then you owe the difference. Owner's choice is good if you want to own the car and can deal with the balloon, plus flexible in that you can always sell when ever you want (harder to walk from a lease). Downside is balloon may be thousands higher than the value.
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      04-20-2013, 07:36 AM   #5
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I am just about to finish BMW Select "Owners Choice" I was lucky enough to land a 0.9% with BMWFS when the economy took a dump and M3's were piling up. I recently called BMWFS to refinance the ballon and they are quoting like 6-7% their story is the model year etc, so I went to Bank of America which has 2.39% -60 mo or 2.65% -72 months I selected the latter of the two and happily slashed my payment in half !!!
Oh and I have equity on top of what the balloon total due is.
So if you keep low miles and baby the car it could be favorable, but keep in mind as the car depreciates you will be paying the same payment all the way 'til the end.
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      04-20-2013, 07:42 AM   #6
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Quote:
Originally Posted by M_Time
I just about to finish BMW Select "Owners Choice" I was lucky enough to land a 0.9% with BMWFS when the economy took a dump and M3's were piling up. I recently called BMWFS to refinance the ballon and they are quoting like 6-7% their story is the model year etc, so I went to Bank of America which has 2.39% -60 mo or 2.65% -72 months I selected the latter of the two and happily slashed my payment in half !!!
Oh and I have equity on top of what the balloon total due is.
So if you keep low miles and baby the car it could be favorable, but keep in mind as the car depreciates you will be paying the same payment all the way 'til the end.
Jesus... 9 years to payoff your car!?

Granted - at 0.9% for 3 yeas and 2.72% for 6 years on the balloon your probably near break even on a the going 5 year 3.19% loan.
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      04-20-2013, 09:16 AM   #7
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Quote:
Originally Posted by riM3
Quote:
Originally Posted by M_Time
I just about to finish BMW Select "Owners Choice" I was lucky enough to land a 0.9% with BMWFS when the economy took a dump and M3's were piling up. I recently called BMWFS to refinance the ballon and they are quoting like 6-7% their story is the model year etc, so I went to Bank of America which has 2.39% -60 mo or 2.65% -72 months I selected the latter of the two and happily slashed my payment in half !!!
Oh and I have equity on top of what the balloon total due is.
So if you keep low miles and baby the car it could be favorable, but keep in mind as the car depreciates you will be paying the same payment all the way 'til the end.
Jesus... 9 years to payoff your car!?

Granted - at 0.9% for 3 yeas and 2.72% for 6 years on the balloon your probably near break even on a the going 5 year 3.19% loan.
It's a business write off
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      04-20-2013, 10:01 PM   #8
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Or perhaps I should finance it for 5 years and after that get something on it? Hmmm...
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      04-21-2013, 05:43 PM   #9
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Owners Choice seems like a bad "choice" all the way around. If you can't afford the payment on a purchase, just lease instead...that way you get the option to buy the car for the residual value at the end of the lease. If your circumstances change, you have the option to just walk away. With Owner's Choice, you have no options...at the end of 5 years, you have to either come up with a big chunk of cash (like $25K+ on an M3) or try and get financing for this from a third party. BMW gave me this option with my X5 and after 5 years I own the car outright for $1,000/month. But with Owners Chice, I have to pay $800/month for 5 years and then I still owe $24K. WTF ?!?!>?!? terrible.
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