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      03-12-2008, 09:52 AM   #1
geoff2010
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Should I lease or buy...

Hello, I am looking for some opinions on my current situation. As we all know, the lease offer on the M3 sucks pretty bad.

My car came out to about 64K MSRP. I am willing to put 14K down. My options as they stand right now:

1 - put a bunch of money down as a cap reduction and end up with a 2 year/12k lease for about 800/mo.

2 - put a bunch down and finance the car for 60 months for about 950-1000/mo and take the depreciation risk personally. I would probably still try to dump the car in 24-36 months.

thoughts?
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      03-12-2008, 10:24 AM   #2
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I would say lease it for 36 months don't put 14k down but maybe 3000 cap cost reduction to get the monthly payments still within reach. Invest the other 11k that would make up some of the interest from the residual
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      03-12-2008, 10:26 AM   #3
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Buy

from talking to a few dealers, it sounds like the money factor for the lease is way high. Also, if you put a bunch of money down on the lease its kind of wasted- all you're really doing is lowering the payment down by $20+/- bucks a month. I'd rather keep that money and make a higher monthly payment.
on a lease my dealer told me 1360 month with 5k down for 3 years. but to buy it was 1530 zero down including taxes and fees for 5 years- that was with a 7.1 loan rate. It was weird, he also said I could get it for $1215month with 15k down. I think the lease rates are a little whack right now. I was hoping for around a thousand with 5k down or less. But if I was getting the car now I'd look to buy. Even if you sell you'll get a decent amount in 2-3 years.
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      03-12-2008, 10:45 AM   #4
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bad!!! definitely buy!
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      03-12-2008, 11:43 AM   #5
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buy!!!
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      03-12-2008, 11:52 AM   #6
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With the current lease factors I would definitely buy.
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      03-12-2008, 12:05 PM   #7
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Yup.. I am definitely a purchase.... with my credit union's rates plus a .25% break if paid automatically + another .25% break for mult. loans, payments are somewhat manageable...
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      03-12-2008, 01:40 PM   #8
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Well, call me a heretic, but for these rates I would definately consider looking elsewhere, maybe at a a 335, S5 or even a CTS-V, if you know what I mean.
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      03-12-2008, 02:02 PM   #9
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Quote:
Originally Posted by carnuts3 View Post
Well, call me a heretic, but for these rates I would definately consider looking elsewhere, maybe at a a 335, S5 or even a CTS-V, if you know what I mean.
If you buy/finance vs lease, it does not matter what car you get. Price paid is all that matters. The rate would be the same for any vehicle assuming a dealer is not running their own finance promotion lower than what you can get.

Plus, he already has ordered the car and is just deciding how to pay for it.
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      03-12-2008, 03:10 PM   #10
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Quote:
Originally Posted by BCMPOWER View Post
I would say lease it for 36 months don't put 14k down but maybe 3000 cap cost reduction to get the monthly payments still within reach. Invest the other 11k that would make up some of the interest from the residual
+1

Put down as little as possible and save/invest the balance

Why only two or three years??...this car will be as fun to drive in 5 yrs as today...the E46 still thrills...plus you can aftermarket with no concerns if you buy
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      03-12-2008, 03:14 PM   #11
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Quote:
Originally Posted by ideliver View Post
+1

Put down as little as possible and save/invest the balance

Why only two or three years??...this car will be as fun to drive in 5 yrs as today...the E46 still thrills...plus you can aftermarket with no concerns if you buy
If you are recommending to keep the car over 5 years, how can you advise to lease at the horrendous lease factors that are out right now and the 5% interest rates for financing?
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      03-12-2008, 03:49 PM   #12
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If your planning on driving the car for a little bit, you should rent. On the other hand if your planning on keeping it, buy
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      03-12-2008, 07:43 PM   #13
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I haven't kept a car longer than 18-24 months in about 8 years. I generally turn over my cars within 18 months... but I have a feeling I'll be into this car for a bit longer.

This is why i generally lean toward leasing, honestly, it's just easier than trying to sell a 2(ish) year old car.

I am sure the ///M3 will be fun for more than 2 years... but by then I am sure i'll be in GT3 or ///M6 territory financially.

thanks for everyones input.
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      03-13-2008, 04:58 PM   #14
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Quote:
Originally Posted by par4bmw View Post
If you are recommending to keep the car over 5 years, how can you advise to lease at the horrendous lease factors that are out right now and the 5% interest rates for financing?

Sorry for the confusion...i see where my post seems to make no sense...

If he only wants the car for 2 or 3 years...lease, but he should hold onto his cash and make a small down payment

The second part of my post is argueing for purchase...I am purchasing mine because I think the car will still have value to me in 5 years...and I am not concerned about the depreciation..
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      03-13-2008, 05:20 PM   #15
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Quote:
Originally Posted by ideliver View Post
Sorry for the confusion...i see where my post seems to make no sense...

If he only wants the car for 2 or 3 years...lease, but he should hold onto his cash and make a small down payment

The second part of my post is argueing for purchase...I am purchasing mine because I think the car will still have value to me in 5 years...and I am not concerned about the depreciation..
Agree. I figured you missed his desire to only have the car 2-3 years.

My advice still is that if you think 2-4 years is how long you will want the car, than either leasing or financing makes sense depending on which has the best rates and what risk/hassle you are willing to take. I would recommend the OP put as little down as he can to obtain a loan around 5%. The lease factors suck!

Last edited by par4bmw; 03-14-2008 at 12:36 AM.
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      03-14-2008, 12:01 AM   #16
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Everyone will have a slightly different take on this depending on their lifestyle and needs...

My personal reasons for suggesting a lease:
  • Advancements in technology effect changes in vehicles at a pace like never before. Model life cycles seem to be shorter than ever.
  • I feel like after 2-3 years, a vehicle is "outdated"
  • The lease is a better write-off for the Inc...
  • I don't want to be married to the car for 5 years.
  • Most cars shouldn't be treated as investments, put as little money toward the capital cost, and always let the bank eat the depreciation.
  • Swapalease.com
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      03-14-2008, 12:54 AM   #17
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This will be my first "new" car for me, so i plan on keeping her for a long time. So i say buy~
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      03-14-2008, 01:19 AM   #18
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If you're keeping the car for 2-3 years, leasing is the most reasonable thing to do. Period.
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      03-14-2008, 10:12 AM   #19
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Put nothing down, the payments should be 1300-1400 for 24 month lease. Take the cash you were going to put down and just offset the lease payment. Keep car for 24 months and move on.
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      03-14-2008, 10:55 AM   #20
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Quote:
Originally Posted by Los Angeles View Post
If you're keeping the car for 2-3 years, leasing is the most reasonable thing to do. Period.
Huh? It is still a financing decision. If the leasing factors suck and the rates for a loan are great, you are better off with a loan. Run the numbers.

As a general rule of thumb the 2-3 years is true, especially considering the attractive leasing incentives dealers usually run on lux brands.
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      03-14-2008, 12:08 PM   #21
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The other thing I am wondering about... since they set the residual so low on the early M3s, wouldn't it make some sense to private sale the car at the end of the lease for more than what I would owe?

I could get the benefits of leasing (lower monthly payment) with less out of pocket, while still making some money back at the end doing a private sale. And if the bank was right and the depreciation is as bad as they claim it will be and I can't sell it... well, then, it's not my problem and i just hand the keys to my dealer.
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      03-14-2008, 12:35 PM   #22
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Quote:
Originally Posted by geoff2010 View Post
The other thing I am wondering about... since they set the residual so low on the early M3s, wouldn't it make some sense to private sale the car at the end of the lease for more than what I would owe?

I could get the benefits of leasing (lower monthly payment) with less out of pocket, while still making some money back at the end doing a private sale. And if the bank was right and the depreciation is as bad as they claim it will be and I can't sell it... well, then, it's not my problem and i just hand the keys to my dealer.
that exactlyyyyy what i was thinking...im glad im not alone...its sort of a win win....you start lookin to sell a month or two before your lease is up...if you can come up a good 5 or even 10 grand why not? if not your right just go ahead and drop the keys off at the dealer....I mean you can easilyy get 40 to 45 after 3 years...cuz ive been lookin at e46 m3's and ive seen 4 or 5 year old models selling for 35 to 38 thousand range...and the e46 isnt even a 70 thousand dollar car...
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