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      02-12-2013, 04:20 PM   #1
jimmy9980
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Good Lease ?

I have a 2008 M3 with 48k miles on it

Dealer told me they will give me $42,300 for my car. I was going to trade my car in, I still have about $18,300 left to pay on it. I was going to roll the money over into the lease for a lower payment. Seems like they took money off the M5 and rolled it into the trade.

2013 M5 Im looking is $102495.00 sticker price

36 month lease
10k miles a year
Buy out will be $52323.45 at the end.
Monthly Payment will be $887.81
taxes on payment $62.15
Total monthly payment with taxes $949.96

What do you guys think ?
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      02-12-2013, 05:21 PM   #2
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Not a good deal.

Never put any money down except deposit on a lease.

You should sell your M3 elsewhere first than go negotiate on the lease deal.
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      02-12-2013, 08:01 PM   #3
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Quote:
Originally Posted by lgallo9980 View Post
I have a 2008 M3 with 48k miles on it

Dealer told me they will give me $42,300 for my car. I was going to trade my car in, I still have about $18,300 left to pay on it. I was going to roll the money over into the lease for a lower payment. Seems like they took money off the M5 and rolled it into the trade.

2013 M5 Im looking is $102495.00 sticker price

36 month lease
10k miles a year
Buy out will be $52323.45 at the end.
Monthly Payment will be $887.81
taxes on payment $62.15
Total monthly payment with taxes $949.96

What do you guys think ?
A couple of recommendations:

1. Never let a dealer "bundle" a trade-in with a new purchase, that's how they take advantage. Negotiate the two deals separately. You've got the trade-in offer, so compare that to the market price of your car. The dealer will be below market, but that can still work if the tax benefit of trading in gets you at or above market price. Based on the info you provided, it seems like the dealer is charging you at or near invoice for the M5 - that's complete BS. There are tons of M5s sitting on dealer lots right now. You should not be paying more than $3,000 over invoice, and you can likely do better than that. With the amount you're rolling into the lease you should be near or below $800 per month with taxes.

2. On the new M5, use edmunds.com or other sources to calculate the invoice price of the car you're interested in. Then negotiate a fair profit for the dealer over invoice. As I said before, if you're willing to take a car out of dealer stock there are enough M5s sitting around you can get one for a few thousand over invoice or better.

3. Once you have both deals negotiated, you can have the dealer apply your trade-in as a down payment on the new car. However, as smashhell indicated, it's usually not a good idea to put money down on a lease. If the car is ever totaled in a wreck, you could likely lose that money. I would only do that if the dealer is giving you a really fantastic offer on the trade-in (i.e., at or above market so that with the tax benefit of a trade-in you're getting a screaming good deal).
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      02-12-2013, 08:22 PM   #4
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Quote:
Originally Posted by lgallo9980 View Post
I have a 2008 M3 with 48k miles on it

Dealer told me they will give me $42,300 for my car.
Wow, that's a good trade-in price. Assuming they're taking it back on the sale price of the M5.
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      02-12-2013, 08:50 PM   #5
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Wow not sure I would spend 50k to lease a car? With those kind of numbers why not buy one as good deals are to be had. Good luck.
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      02-13-2013, 11:07 AM   #6
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Quote:
Originally Posted by Bimmer6
Wow not sure I would spend 50k to lease a car? With those kind of numbers why not buy one as good deals are to be had. Good luck.
I would think that on the face of it buying would be a logical choice based on the total cost of the lease.

However it may still be worth it if you are able to write a portion or all of it off your taxes.

If you would like a put option on a 1st year niche car that has unproven resale value. Do you remember when gently used E60's were getting on hammered resale price in late '08/'09???

Lastly there are some people who rather tie up there excess cash in investments which yield higher returns or spend that money on Hookers and blow!

The key with a lease or any financial transaction is to understand exactly what the total cost is and reduce it within the given parameters of the deal.

Just my 2c
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      02-13-2013, 01:47 PM   #7
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I made a mistake in numbers

I have a 2008 M3 with 48k miles on it

Dealer told me they will give me $42,300 for my car. I was going to trade my car in, I still have about $18,300 left to pay on it. I was going to roll the money over into the lease for a lower payment. Seems like they took money off the M5 and rolled it into the trade.

2013 M5 Im looking is $103595.00 sticker price

36 month lease
10k miles a year
Buy out will be $52323.45 at the end.
Monthly Payment will be $887.81
taxes on payment $62.15
Total monthly payment with taxes $949.96

All I would do is use my trade as the down payment. Dealer is saying that $26550.00 would be used as the down payment towards the lease. According to the Dealer that would leave me with $19,000k left from the trade and they took 7550.00 off the $103595.00 of the car which in the price includes doc fees. Wouldn't the cost of the car then be $96045.00, $500.00 over dealer invoice?

I guess if I bought the car at the end the total would be
19,000k from trade
$52323.45 Buy out at the end
plus monthly payments = $103255.45



Even is I were to sell my car private I dont think I would get more then 39-40k for it for 2008 with the miles ?

Seems kind of high ?
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      02-13-2013, 02:25 PM   #8
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As stated previously, negotiate a deal on the M5 (preferably invoice + $xxxx) and a separate deal for your trade in from the dealer. If you owe $18,300 and they're offering $42,300, that's $24k in positive equity that you should walk away with. DO NOT use that cash as a cap cost reduction. If you are so inclined, max out your multiple security deposits with some of that equity and bank the rest. Then, just pull funds from that pot on a monthly basis to offset the difference in the low monthly payment you currently have calculated and the resulting monthly payment without the down payment.
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      02-13-2013, 04:16 PM   #9
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Even with your big money down the payment looks awfuly high. Like all I'd advise not to put $$$ down, maybe taxes and some fee's and thats all. This dealer is jacking MF, ask them what it is.
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      02-13-2013, 04:21 PM   #10
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A few questions??? What is the purchase price of the new M5? you aren't paying MSRP, are you???? Are you putting down $24,000??? Are you working with Inskip?
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      02-13-2013, 04:25 PM   #11
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Yes I would take that trade value in a heart beat.. I have a 2009 m3 coupe with full options that I will be selling next week or trading in for m5.
I would be lucky to get $35k as trade in and $38-39k max for private party..because thats blue book in California.
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      02-13-2013, 09:39 PM   #12
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Quote:
Originally Posted by medman2k1 View Post
I would think that on the face of it buying would be a logical choice based on the total cost of the lease.

However it may still be worth it if you are able to write a portion or all of it off your taxes.

If you would like a put option on a 1st year niche car that has unproven resale value. Do you remember when gently used E60's were getting on hammered resale price in late '08/'09???

Lastly there are some people who rather tie up there excess cash in investments which yield higher returns or spend that money on Hookers and blow!

The key with a lease or any financial transaction is to understand exactly what the total cost is and reduce it within the given parameters of the deal.

Just my 2c
Yeah, I hear ya but a car is a car and I never look at it as an investment. To drop 50k and give it back to drive it for 30k miles is not wise in my opinion a sure way to throw away money. Just my opinion keeping up with the Jone's can get you broke .....if I can't pay for it I don't get it. Tax right off on cars only work when you can charge it against the business, but it's still giving money aways unless it will make money for you while you drive it.
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      02-14-2013, 09:22 AM   #13
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Quote:
Originally Posted by Rohardi View Post
A few questions??? What is the purchase price of the new M5? you aren't paying MSRP, are you???? Are you putting down $24,000??? Are you working with Inskip?
No Dealer in New London CT, I think what they are doing is giving me around 38k for my car and the rest is from the price difference from what they took off MSRP. Cause at best trade in value for my car would be around 36k if that.

I don't have to put any money down it would just be the trade from my car. But the dealer said he is giving me a higher trade in value to get the payment lower. In the numbers he told me that my trade would give me $24550 and 2k from a special BMW had that would go towards the lease totaling $26550. Again I didnt put any money in out pocket only using the trade of my car.
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      02-14-2013, 11:15 AM   #14
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i would just sell your car private and keep $25k cash in your pocket
go to dealer, put out $1500 + out of pocket drive off and take a higher payment of around $1300
That's what i'm doing next week.. but my best offer right now is a few dollars more than those numbers so i'm still in the process of making a deal but it is very close!!!
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      02-14-2013, 01:49 PM   #15
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After speaking to the dealer again.

The $102495.00 - 6550.0 = Cost of car $95945.00

Trade in money from car would be $18,000k They are giving me around $36k for the 2008 M3. Dealers are all bad. If I sold it privately might be able to get 38-39k but its a pain in the ass.
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      02-14-2013, 06:01 PM   #16
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Quote:
Originally Posted by lgallo9980 View Post
After speaking to the dealer again.

The $102495.00 - 6550.0 = Cost of car $95945.00

Trade in money from car would be $18,000k They are giving me around $36k for the 2008 M3. Dealers are all bad. If I sold it privately might be able to get 38-39k but its a pain in the ass.
Why not do ED, get a much lower purchase price for your car, and sell your car to the dealer/sell it out right. It looks like you're trying to get the lowest posable payment. If you do ED, you will have a lower purchase price, and won't have to put all the equity (money) from your current car to get a lower payment... Just an idea...
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      02-15-2013, 08:24 AM   #17
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I think that's a pretty handsome trade-in they priced for you. I traded my 08 sedan last year for $40 and dealer wanted me to include all my mods ( tires, wheels, titanium exhaust , Dinan mods.....) I had 70000km with was about 43k miles. Also, here in Canada, the m3 costs me nearly $80k to purchase.
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      02-16-2013, 11:37 PM   #18
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Quote:
Originally Posted by lgallo9980 View Post
After speaking to the dealer again.

The $102495.00 - 6550.0 = Cost of car $95945.00

Trade in money from car would be $18,000k They are giving me around $36k for the 2008 M3. Dealers are all bad. If I sold it privately might be able to get 38-39k but its a pain in the ass.
take the trade in - you cant get more than that in the open market as you mileage is pretty high + waste a boat of load dealing with tire kickers
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      02-18-2013, 12:21 AM   #19
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Again DON'T put any money down on a lease.

It doesn't make any sense at all.

You can sell the car yourself or to the dealer or carmax whatever. But after that pocket the money.

If you use it on the lease you are NOT lowering your money payment. You are just paying in advance. In the end you are still paying the same amount of money but earlier. (and less safe, totaled etc)

Why would anyone do that? Better to put that money in a bank and pile interest or invest it.
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