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      03-31-2017, 06:15 PM   #23
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As much as I respect the M2, it will always be compared to the M4 and thus never it's equal.
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      03-31-2017, 06:16 PM   #24
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Originally Posted by xander_g View Post
Buying a vehicle at the end of a lease is never a good idea imho
I'm curious about this statement also. I'd bet that many people on here who bought used bought at the end of someone else's lease. If you buy at the end of your lease at least you know the true history of the car and how it's been cared for.

I'm surprised at all the chatter about an M2. It's a very different type of car. Yes, it may be comparable in speed around a track but it's as different from the M4 as the M4 is from the M6. I like the M2 but i wouldn't want one.

I just checked bmwusa.com for CPO 2015 M4s. Prices are $57k-$70k so that $50k could be considered a bargain depending on options. And no, unless it was my car, I wouldn't likely buy a used M car that wasn't CPO.
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      03-31-2017, 06:21 PM   #25
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I did the math. my car was stickered at $76k. it was leased based on $72k price. If I buy at the predetermined price of $50k end of lease I'll end up paying MSRP.

I assumed the lease at month 3 (1300 miles) with some seller incentives.

I do the oil changes and will change spark plugs at 20k miles. zero problems with the car so far.
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      03-31-2017, 06:35 PM   #26
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Quote:
Originally Posted by Fast4d View Post
I did the math. my car was stickered at $76k. it was leased based on $72k price. If I buy at the predetermined price of $50k end of lease I'll end up paying MSRP.

I assumed the lease at month 3 (1300 miles) with some seller incentives.

I do the oil changes and will change spark plugs at 20k miles. zero problems with the car so far.
Are you picking up the entire lease payment in that analysis or recognizing that part of the lease payment is depreciation / principal, part is interest (like any other financing) and part is sales tax?

If you pick up the depreciation part of the lease payments and add to residual you will, by definition, get back to cap cost.
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      03-31-2017, 07:20 PM   #27
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Quote:
Originally Posted by a1gio2 View Post
I am leasing a 2015 M3 optioned the way I like and its a $76k car.

At the end of my lease I will likely have 25k and the residual will be $50k.

The car doesn't consume oil, and has been very reliable and trouble free.

Options I'm debating:

A. Buy a new MY18 M2 - try to get out of the M3 lease a little early.

B. Buy the M3 when the lease is up.

Both will cost roughly the same money. I don't want to lease another and the price for purchasing A or B will be roughly the same each month.

What would you do and why?
It's never smart to buy out a lease because the total of the lease payments never add up to the end buyout price.

I would just forget that car and buy another one.
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      03-31-2017, 07:34 PM   #28
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It is always interesting to see how many people don't understand lease financing every time a topic like this one arises. I think we can all agree it is best for those who don't grasp the basics to avoid leasing altogether.
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      03-31-2017, 07:35 PM   #29
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If the residual is comparable to the market price of the car then go for the buyout. You obviously love the car and take good care of it, why wouldn't you want to keep it longer especially when it has already taken its most significant depreciation hit?
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      04-01-2017, 08:10 AM   #30
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Why would one downgrade from a m3 to a m2?? Cars slower, to small, less power, less tuning potential, interior sucks and I personally think ugly. I guess to each their own.
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      04-01-2017, 09:28 AM   #31
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Quote:
Originally Posted by RickFLM4 View Post
It is always interesting to see how many people don't understand lease financing every time a topic like this one arises. I think we can all agree it is best for those who don't grasp the basics to avoid leasing altogether.
This.

It's fascinating how much misinformation people post.
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      04-01-2017, 12:01 PM   #32
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Quote:
Originally Posted by mercedesc63 View Post

It's never smart to buy out a lease because the total of the lease payments never add up to the end buyout price.

I would just forget that car and buy another one.
It's always smart to never say never.

I always lease BMWs because leasing minimizes your financial risk - it's exactly like a loan, but with more options and instead of you taking the financial risk of asset price collapse, BMWFS does. And BMW leases are particularly great because they buy residual insurance which means it's a great deal for us versus Mercedes or Porsche.

These days I would never take a car loan simply because the sub-prime bubble moved from mortgages to cars loans, and that bubble is about to burst and kill used car prices.

Now will that affect M cars? Or the economy as a whole? Maybe. who knows?

Why the fuck would I take the risk by getting a car loan or buying outright?







Here's your bubble:

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      04-01-2017, 12:20 PM   #33
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Quote:
Originally Posted by GrussGott View Post
Quote:
Originally Posted by mercedesc63 View Post
It's never smart to buy out a lease because the total of the lease payments never add up to the end buyout price.

I would just forget that car and buy another one.
It's always smart to never say never.

I always lease BMWs because leasing minimizes your financial risk - it's exactly like a loan, but with more options and instead of you taking the financial risk of asset price collapse, BMWFS does. And BMW leases are particularly great because they buy residual insurance which means it's a great deal for us versus Mercedes or Porsche.

These days I would never take a car loan simply because the sub-prime bubble moved from mortgages to used cars, and that bubble is about to burst and kill used car prices.

Now will that affect M cars? Maybe. who knows? But why the fuck would I take the risk?

Of course I agree that leasing has the least amount of risk involved in it (in many ways). I leased my 16' M3 and I just sold it.

All I am saying is that first of all OPs car isn't even new it's used he assumed the lease. I think he would be better off getting a brand new one for the same cost.

My point is that the lease buyout is never the sum of all the payments which is why if buying it is not a good deal MOST of the time.
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      04-01-2017, 12:27 PM   #34
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Quote:
Originally Posted by mercedesc63 View Post

My point is that the lease buyout is never the sum of all the payments which is why if buying it is not a good deal MOST of the time.
yes, but that's a moot point because you can negotiate. For example, let's say the used market collapses - one might get a heck of a deal at lease buyout time because the last thing they'd want is another car back.

My point is you're using words like "never" which aren't true.

It's like saying, "I can't afford MBA school tuition because it's $30k more than I can afford". Ok, then negotiate it down $30k. That's the first test of your business acumen: B-schools (or any grad school or university) don't exactly advertise that you can negotiate for obvious reasons but you can.

That's my point.
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      04-01-2017, 12:28 PM   #35
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Quote:
Originally Posted by GrussGott View Post
It's always smart to never say never.

I always lease BMWs because leasing minimizes your financial risk - it's exactly like a loan, but with more options and instead of you taking the financial risk of asset price collapse, BMWFS does.
Fascinating data, Gruss. Thought provoking as always. There are clear reasons to lease and clear reasons to buy. The amount of discussion on the boards is because there is such a large grey area between the two, or that the grey area is relatively small but the level of understanding of financial risk is also understated (as your post points out).

I always purchase because my average car ownership is 10 years, so that makes leasing a non starter for me.
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      04-01-2017, 12:30 PM   #36
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Quote:
Originally Posted by GrussGott View Post
Quote:
Originally Posted by mercedesc63 View Post

My point is that the lease buyout is never the sum of all the payments which is why if buying it is not a good deal MOST of the time.
yes, but that's a moot point because you can negotiate. For example, let's say the used market collapses - one might get a heck of a deal at lease buyout time because the last thing they'd want is another car back.

My point is you're using words like "never" which aren't true.

It's like saying, "I can't afford MBA school tuition because it's $30k more than I can afford". Ok, then negotiate it down $30k. That's the first test of your business acumen.

That's my point.
I beg to differ lease buyouts aren't negotiable
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      04-01-2017, 12:33 PM   #37
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Quote:
Originally Posted by mercedesc63 View Post

I beg to differ lease buyouts aren't negotiable
You shouldn't beg, it looks weak.

but seriously folks, I'm too lazy to argue with you, and for you I'm sure you're right.
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      04-01-2017, 12:55 PM   #38
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Quote:
Originally Posted by GrussGott View Post
You shouldn't beg, it looks weak.

but seriously folks, I'm too lazy to argue with you, and for you I'm sure you're right.
lol, did anyone read my post??????????????????? If u structure your lease properly only paying 1kor2k more versus a fiance is DIRT CHEAP insurance if u wanna walk away after three years. but it falls on deaf ears
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      04-01-2017, 01:06 PM   #39
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Quote:
Originally Posted by mercedesc63 View Post
It's never smart to buy out a lease because the total of the lease payments never add up to the end buyout price.
Quote:
Originally Posted by mercedesc63 View Post
My point is that the lease buyout is never the sum of all the payments which is why if buying it is not a good deal MOST of the time.
As I explained earlier in this thread and I believe I explained to you in other threads, your analysis is fundamentally flawed. By definition, the depreciation portion of the payments + residual = cap cost. If you want to compare one cost with interest and tax included to another with neither, of course the former will be higher but it is an irrelevant comparison.

Furthermore, once you decide to lease that decision is made. The buyout decision comes later, independent of what you did upfront. If the car is worth more than the residual it doesn't really matter what previous payments add up to. You can buy a car with a history you know for less than you could buy the same car a stranger previously owned. I get it if one chooses not to exercise the buyout option because they want a new car, and even understand why some choose to purchase and hold the car for a long time, but can't imagine why someone would conclude it never or rarely makes sense to buy out a car at lease-end based on economics that factor in historical lease payments to make a current decision.
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      04-01-2017, 01:28 PM   #40
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Quote:
Originally Posted by RickFLM4 View Post
As I explained earlier in this thread and I believe I explained to you in other threads, your analysis is fundamentally flawed. By definition, the depreciation portion of the payments + residual = cap cost. If you want to compare one cost with interest and tax included to another with neither, of course the former will be higher but it is an irrelevant comparison.

Furthermore, once you decide to lease that decision is made. The buyout decision comes later, independent of what you did upfront. If the car is worth more than the residual it doesn't really matter what previous payments add up to. You can buy a car with a history you know for less than you could buy the same car a stranger previously owned. I get it if one chooses not to exercise the buyout option because they want a new car, and even understand why some choose to purchase and hold the car for a long time, but can't imagine why someone would conclude it never or rarely makes sense to buy out a car at lease-end based on economics that factor in historical lease payments to make a current decision.
someone please sticky this post!
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      04-02-2017, 04:19 AM   #41
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Quote:
Originally Posted by RickFLM4 View Post
It is always interesting to see how many people don't understand lease financing every time a topic like this one arises. I think we can all agree it is best for those who don't grasp the basics to avoid leasing altogether.
It is always interesting to see an elitist put down someone who is actively seeking knowledge on a subject by telling those who lack said knowledge they should just avoid the subject altogether, and that the reason they should avoid the subject is because they lack the knowledge for which they seek.
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      04-02-2017, 07:11 AM   #42
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Quote:
Originally Posted by Kung Fu English View Post
Quote:
Originally Posted by RickFLM4 View Post
It is always interesting to see how many people don't understand lease financing every time a topic like this one arises. I think we can all agree it is best for those who don't grasp the basics to avoid leasing altogether.
It is always interesting to see an elitist put down someone who is actively seeking knowledge on a subject by telling those who lack said knowledge they should just avoid the subject altogether, and that the reason they should avoid the subject is because they lack the knowledge for which they seek.
There is a difference between seeking information and spreading misinformation. If you read the thread I was clearly referring the latter. For example, I have no issue with the OP's question but rather object to those telling him it doesn't make sense to consider buying out his lease because they say so.

Calling out someone spreading misinformation is not "elitist" so get over it.
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      04-03-2017, 02:10 AM   #43
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Quote:
Originally Posted by RickFLM4 View Post
There is a difference between seeking information and spreading misinformation. If you read the thread I was clearly referring the latter. For example, I have no issue with the OP's question but rather object to those telling him it doesn't make sense to consider buying out his lease because they say so.

Calling out someone spreading misinformation is not "elitist" so get over it.
It came across that you were putting down the OP for asking the question insinuating he should stay out of leasing.
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      04-03-2017, 09:11 AM   #44
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To clarify further, I'd rather have an m3 over an m2. I configured mine with the intention of purchase, but when I found out about the 66% residual, I opted to lease instead. I was able to negotiate $70k on a $76 car. My monthly payments were $400 cheaper leasing over finance. No MSD's.

If I purchase this car after the lease, the negotiated price won't matter and I would have paid MSRP. That is assuming the purchase price is $50k and not negotiable.

If the car remains in the condition it is currently in and I could negotiate the purchase price to $45k, I'd buy it. I base this on a few factors:

A. I like how the car is configured
B. It has been reliable without any oil consumption, differential issues, or any hiccups that would make me be wary of long term ownership.

I won't buy a new M3 because priorities change and I can't shell out that extra $400 a month and I don't think 66% residuals are happening again soon, so it will cost me a lot more to lease the same car (unless I'm missing something)
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