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      06-26-2013, 12:18 AM   #1
Kung Fu English
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M3 arrives at dealer Friday. Buy or Lease???

Have an M3 coming into my local dealer confirmed as mine. It will arrive Thursday night and I will take delivery Friday. Car is 2013 with all the packages, comp/premium/comfort/cold weather and DCCT and BMW apps and moonroof.

I have the purchase order as a buy for now but I will still have the option to lease instead if I like when I take delivery. At this point, I can't decide.

The sale sticker is 71875 and I get 1500 of a down payment from BMW FS for either option, so the final finance price is 70375 or so.

Financing over 6 years/72 mos at 3.05% comes to around 1158/mo. [6% sales tax, 224 DMV, 15 title - total 76439.94] (Side note, this would be my lowest interest loan atm so if I could finance it over 100 years I would, please no ZOMG UR FINANCING OVER SO LONG posts, unless I'm missing something).

The lease is 36 mos/10k miles. The quote paper states MSRP/CRF 75875 (+4k from the sale price??) and a residual 62% of 47042.50. Payment is 954.95 and I get the 1500 off of the value due at signing from the BMW FS deal.

He told me that with about 3-6 months left in the lease I can add miles as a one time deal at 0.16 per mile. If I don't add them the penalty is 0.20/mi (difference 4 cents/mi) and adding them up front is 0.15/mile.

I'm not sure I'll keep the car more than 3 years regardless. Though I never know and could keep it for 8 years like I have with my STI, I'd likely be ready to get a new version in 3 years.

I've also considered that I might trade the car in earlier if the next years M3s are that much more amazing, but I doubt it.

Questions abound:
1) do these numbers seem correct? By my calculation it's about 7400 more to buy than lease over 36 mos. Where is the +4k on the lease MSRP/CRV coming from - is this the mileage allowance? Is the residual correct?

2) I'm terrified of lease penalties. Is this justified?

3) I do plan on making some cosmetic changes like carbon fiber mirrors and splitters and getting black 359 rims instead of silvers, is this just wasted on a lease? Or is it just going to be wasted either way (ie not increase resale value either)? I'm ok with this if so.

4) What are the pros and cons of leasing vs financing with these numbers. How much trade in can I expect in 2-3 years if/when I do trade it in?

Thanks for reading!

Last edited by Kung Fu English; 06-26-2013 at 01:15 AM. Reason: More definitive numbers.
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      06-26-2013, 12:43 AM   #2
Hyperjack
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personally, i'd lease. i like putting as little money into a car as possible at any given time.

if you do, make sure...

1) that you have a good handle on how many miles you drive a year, if this is your DD. if not , like myself, i would definitely lease if this is just a weekend car.

2)IF you want to buy after the lease ( something that is not wise to do most of the time)... make sure that the selling price of the vehicle is low enough, that once you've paid term...whatever that cost is added to the residual value is roughly around vehicle's original msrp. this, IMO, makes buying after a lease somewhat justified.

this can be difficult to do now, because most dealers probably won't sell you the car at such a low price.

3) it terms of mods. make sure whatever you do, can be reversed. this way you can sell what mods you've added later. you'll take a hit...but that's what you do whenever you sell a used item.

and here's the thing about all of this....something non car people don't get...it's not an investment. it depreciates like most all material goods....sometimes even more so than others.

no matter how you look at it there will be a loss of money.....IMO, that's not such a loss, when you weigh it against the enjoyment you've gained from it. it's this variable that can't be quantified.....and drives non car people up the wall.

the way i justify all of this is that i don't put a lot of money in the car at any given time. that way if anything happens to it, i'm not at such a loss. if i keep it longer, it costs me more.

bottom line, if it's a loss you can not afford....don't do it.
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      06-26-2013, 01:19 AM   #3
Kung Fu English
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Quote:
Originally Posted by Hyperjack View Post
personally, i'd lease. i like putting as little money into a car as possible at any given time.

if you do, make sure...

1) that you have a good handle on how many miles you drive a year, if this is your DD. if not , like myself, i would definitely lease if this is just a weekend car.

2)IF you want to buy after the lease ( something that is not wise to do most of the time)... make sure that the selling price of the vehicle is low enough, that once you've paid term...whatever that cost is added to the residual value is roughly around vehicle's original msrp. this, IMO, makes buying after a lease somewhat justified.

this can be difficult to do now, because most dealers probably won't sell you the car at such a low price.

3) it terms of mods. make sure whatever you do, can be reversed. this way you can sell what mods you've added later. you'll take a hit...but that's what you do whenever you sell a used item.

and here's the thing about all of this....something non car people don't get...it's not an investment. it depreciates like most all material goods....sometimes even more so than others.

no matter how you look at it there will be a loss of money.....IMO, that's not such a loss, when you weigh it against the enjoyment you've gained from it. it's this variable that can't be quantified.....and drives non car people up the wall.

the way i justify all of this is that i don't put a lot of money in the car at any given time. that way if anything happens to it, i'm not at such a loss. if i keep it longer, it costs me more.

bottom line, if it's a loss you can not afford....don't do it.
Yes this is a daily driver and now that my wife won't hate riding in my car we are more likely to drive this more often to events and things than my current car (04 STI with suspension mods).

I certainly agree with you about the not an investment part. I understand that of course I assume most people here would but lol I know where you are coming from.

If I lease and then buy the car the total cost comes to 81420.70.

The difference between that and the financed cost of 76439.94 is likely that 4k on the lease MSRP I don't know where that's coming from. That also doesn't include the taxes on the purchase of 47k. Seems odd to me so far.

Thanks for your helps
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      06-26-2013, 01:33 AM   #4
Hyperjack
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let's back this up a bit. before you decide to lease or buy....let's talk about this selling price.

you said the sticker price is 71875$...are you telling me that all the dealer is willing to do for you is give you the BMW $1500?

if that's the case, i'd try for a lot lower price. a good rule of thumb is to start from invoice and work up.

if they're not willing to go below MSRP...look elsewhere. or look at buying a lightly used M3. given used car interest rates, i can't tell you what's better until you actually look at what's out there now.
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      06-26-2013, 01:56 AM   #5
Kung Fu English
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Quote:
Originally Posted by Hyperjack View Post
let's back this up a bit. before you decide to lease or buy....let's talk about this selling price.

you said the sticker price is 71875$...are you telling me that all the dealer is willing to do for you is give you the BMW $1500?

if that's the case, i'd try for a lot lower price. a good rule of thumb is to start from invoice and work up.

if they're not willing to go below MSRP...look elsewhere. or look at buying a lightly used M3. given used car interest rates, i can't tell you what's better until you actually look at what's out there now.
Nah the MSRP is 75k or so. They gave me 3500 off and another 1000 off for the drive event.
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      06-26-2013, 06:27 AM   #6
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Quote:
Originally Posted by Kung Fu English
Quote:
Originally Posted by Hyperjack View Post
let's back this up a bit. before you decide to lease or buy....let's talk about this selling price.

you said the sticker price is 71875$...are you telling me that all the dealer is willing to do for you is give you the BMW $1500?

if that's the case, i'd try for a lot lower price. a good rule of thumb is to start from invoice and work up.

if they're not willing to go below MSRP...look elsewhere. or look at buying a lightly used M3. given used car interest rates, i can't tell you what's better until you actually look at what's out there now.
Nah the MSRP is 75k or so. They gave me 3500 off and another 1000 off for the drive event.
Invoice is 7% off msrp, 9% off of options. Don't throw money away.
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