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      02-14-2008, 05:51 PM   #1
geoff2010
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Cap Reduction on Lease

I have read some conflicting things... and just want to get a few peoples opinions on the matter.

I am planning on leasing my M3 when it arrives... I was going to put 12K down to reduce my monthly nut. Mentally, I would rather take a one time hit than have to pay a $1200+ bill every month. What are the pro's and con's to putting a big chunk of money down on a leased car?

-Geoff
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      02-14-2008, 05:52 PM   #2
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Quote:
Originally Posted by geoff2010 View Post
I have read some conflicting things... and just want to get a few peoples opinions on the matter.

I am planning on leasing my M3 when it arrives... I was going to put 12K down to reduce my monthly nut. Mentally, I would rather take a one time hit than have to pay a $1200+ bill every month. What are the pro's and con's to putting a big chunk of money down on a leased car?

-Geoff
One big con is that money could be put into an investment somewhere to grow instead of just sitting in BMW's pocket.
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      02-14-2008, 06:25 PM   #3
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Originally Posted by Xcellere View Post
One big con is that money could be put into an investment somewhere to grow instead of just sitting in BMW's pocket.
#2 if you total that car good by down payment. and you have to start all over again
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      02-14-2008, 06:34 PM   #4
geoff2010
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so your saying that if I total the car i just lose the 12K i put down? How is that possible... isn't that what car insurance is for?
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      02-14-2008, 06:43 PM   #5
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Originally Posted by geoff2010 View Post
so your saying that if I total the car i just lose the 12K i put down? How is that possible... isn't that what car insurance is for?
Well, you don't lose is per se, but you owe BMW the lease amount, and if you crash, the insurance company only gives you how much the car is worth. Most of the time this is less than the lease cost, so you generally end up losing your down payment. What you need is gap insurance to cover the difference. I believe you get gap insurance through your lease company, not auto insurance company, so make sure you ask for it when you pick up your car. I think it ranges from 300-800 bucks, which is worth it IMO.
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