Is it stupid to pay a huge downpayment?

[TS29849228]

Im about a few days away from walking into a few of my local dealerships.
I plan on asking for an allocation for a new M4. I know what options I want and which ones I don't.

I have been working and saving for this car for over two years now.
My question is:

Does anybody else here lease/finance an M3/4? Has anyone tried to pay 10k or 20k for the downpayment? If so, what does this huge downpayment do for you? Has anyone gotten their monthly payment down to sub $400 level?

This is my first time purchasing a car for myself, previously my uncle bought a used E46 for me when I was in college. So I don't have any experience buying cars from dealership.

Thanks for any input you guys have! I tried asking BMW of Monrovia these questions two weeks ago but once the guy realized i'm only 30 years old he just shrugged me off and didnt really give me any of his time. Let me know guys!

[damageprone]

Are you planning on leasing or financing?

I'm no lease expert, but from what I understand you shouldn't put a down payment on a lease.

If you're financing, don't forget to factor in the tax and registration, which depending on the options can be $7K on top of the price of the car. Also if you get a decent APR you probably can get away with a lower down payment if you can handle the higher monthly.

[G35POPPEDMYCHERRY]

its quite simple. why downpayment? just keep the money and use it to pay the car off overtime. If you can't trust yourself with the money, then do not buy an expensive car. Not saying that is you, just a general statement. Furthermore, do not put money down when leasing, you can easily lose it. When buying, I guess you lower the amount that is subject to interest, solid investing can yield you 5% return every year so some like their money to work for them and beat the interest rate.

Lol 30 years old and a shurg off.

Fuckin clowns that work at BMW.

I was 23 when I ordered my f80 and have not a single problem making the payments.

I go in the showroom and ask them to open the doors on an m6 and the CA says this may be a little too much car for you.

find a CA that shows respect. cant stand the ones that profile. My dad could buy ever car in the showroom in cash, and looks homeless

[alex2364]

$0 down for a lease, put as much down as you're comfortable with for finance. Sounds like you need to figure out if you want to lease or finance and the pros/cons of each before walking into the dealer. Otherwise, the dealer will just see a guy willing to throw cash out the window.

[TS29849228]

Originally Posted by G35POPPEDMYCHERRY

its quite simple. why downpayment? just keep the money and use it to pay the car off overtime. If you can't trust yourself with the money, then do not buy an expensive car. Not saying that is you, just a general statement. Furthermore, do not put money down when leasing, you can easily lose it. When buying, I guess you lower the amount that is subject to interest, solid investing can yield you 5% return every year so some like their money to work for them and beat the interest rate.

Lol 30 years old and a shurg off.

Fuckin clowns that work at BMW.

I was 23 when I ordered my f80 and have not a single problem making the payments.

I go in the showroom and ask them to open the doors on an m6 and the CA says this may be a little too much car for you.

find a CA that shows respect. cant stand the ones that profile. My dad could buy ever car in the showroom in cash, and looks homeless

Originally Posted by alex2364

$0 down for a lease, put as much down as you're comfortable with for finance. Sounds like you need to figure out if you want to lease or finance and the pros/cons of each before walking into the dealer. Otherwise, the dealer will just see a guy willing to throw cash out the window.

Thanks for the input guys,
The reason why it may seem like I haven't decided on a lease or finance is because to me they're both the same.

The lease ends up giving you a buy out option which is like 35 to 45k at the end of the 3 year lease. But then again, this money factor thing I haven't even started to understand it.

My main issue is the monthly payment, I don't want to shell out 700 per month. I have some cash saved for a downpayment and if the monthly payment can be somewhere around 400-500, I will easily shell out this large downpayment. Is this possible for a finance?

I will go to the dealership and I dont know, dress up as if i'm about to walk into work on Monday, maybe then they'll take me seriously.

Will let you know! (And in the future you'll see a build thread for my baby too)
Cheers!

For everyone else: Any more input would be great

[JibSTir13]

If you want your finance payment to be sub $400, you're going to have to put a significant amount down.

Depending on the OTD price of the car and interest rate, my estimate is that you are looking at a down payment range somewhere between $40k - $60k.

[TS29849228]

Originally Posted by JibSTir13

If you want your finance payment to be sub $400, you're going to have to put a significant amount down.

Depending on the OTD price of the car and interest rate, you are looking at a down payment range somewhere between $40k - $60k is my estimate.

Wow! Noted, thank you...
I will be going thru the numbers with my Uncle and of course with a CA at some point.... as of now my largest possible downpayment would be 23-24k. But we will see..

thank you..

[damageprone]

Originally Posted by TimmayShanticlause

Wow! Noted, thank you...
I will be going thru the numbers with my Uncle and of course with a CA at some point.... as of now my largest possible downpayment would be 23-24k. But we will see..

thank you..

With that down, you're looking at a stripper F80 and $8-900 monthly (60 months).

Use any car payment calculator online like this one at CarMax, and you'll get a clearer picture https://www.carmax.com/car-financing...ent-calculator

Honestly, with what you're comfortable to spend a month, I'd say get a used 2015. That's more in your range for the "same" car more or less. A little less tech but still very nice, depending on what car you're coming from.

[gatorfast]

Originally Posted by TimmayShanticlause

Thanks for the input guys,
The reason why it may seem like I haven't decided on a lease or finance is because to me they're both the same.

The lease ends up giving you a buy out option which is like 35 to 45k at the end of the 3 year lease. But then again, this money factor thing I haven't even started to understand it.

My main issue is the monthly payment, I don't want to shell out 700 per month. I have some cash saved for a downpayment and if the monthly payment can be somewhere around 400-500, I will easily shell out this large downpayment. Is this possible for a finance?

I will go to the dealership and I dont know, dress up as if i'm about to walk into work on Monday, maybe then they'll take me seriously.

Will let you know! (And in the future you'll see a build thread for my baby too)
Cheers!

For everyone else: Any more input would be great

Honestly the bolded statement tells me you have much to learn about car buying and basic finance so its a good thing you are seeking advice on this. Also your earlier comment in this thread about asking your local dealership about how down payment size affects your payment shows your naivete. I am surprised they blew you off and were not salivating at making a sale since it is obvious you are potentially someone who could be taken advantage of. Please dont take these comments the wrong way, just want to warn you that there are a lot of nuances about lease/finance considerations and if you dont understand it all you stand to over pay, possibly by a lot.

If you search through this section you will find lots of good threads discussing the merits of leasing vs financing and the pros/cons to each. Just know they are most certainly not the same and as it relates to a down payment should be treated very differently.

[TS29849228]

Originally Posted by gatorfast

Honestly the bolded statement tells me you have much to learn about car buying and basic finance so its a good thing you are seeking advice on this. Also your earlier comment in this thread about asking your local dealership about how down payment size affects your payment shows your naivete. I am surprised they blew you off and were not salivating at making a sale since it is obvious you are potentially someone who could be taken advantage of. Please dont take these comments the wrong way, just want to warn you that there are a lot of nuances about lease/finance considerations and if you dont understand it all you stand to over pay, possibly by a lot.

If you search through this section you will find lots of good threads discussing the merits of leasing vs financing and the pros/cons to each. Just know they are most certainly not the same and as it relates to a down payment should be treated very differently.

No don't worry, I value any type of input.
I definitely do not understand lease/financing very much...

I will pour over this forum for the time being until I go back into the dealership..
Thanks!

[TS29849228]

Another question of mine: (Please excuse me if it is a stupid question)
Can I chose to lease the car IF I KNOW that the payment at the end of the lease to buy the car out: I can handle?

For example, I have a sum of money NOW for the downpayment and 3 years later having a sum of money to PAY OFF the car is not a problem for me... is it realistic I go lease the car instead of financing AND pay a large lease downpayment?

My main objective: to pay a tiny monthly payment each month. That is the most important thing for me.

We all know a lease in California for an M4 is about 850+ per month, and the same car financed would be 1200+ per month or in that range. I Do Not Want To Pay So Much Each Month.

[HPIA4v2]

In general,
financing is not a good deal if you don't hang on to the car at least 6-years and in some cases longer due to non-linear depreciation curve.

As far as putting money down on lease, two things come to mind:
1)are you saving money on not paying MF interest on that down-payment. Can you get GUARANTEE better return on that downn-payment
2)Just look at your accident record in the past, if you pretty safe driver then OK to put down payment. the main argument always, if you total the car that down payment is gone on a lease.

only you can answers those questions.

[damageprone]

Originally Posted by TimmayShanticlause

Another question of mine: (Please excuse me if it is a stupid question)
Can I chose to lease the car IF I KNOW that the payment at the end of the lease to buy the car out: I can handle?

For example, I have a sum of money NOW for the downpayment and 3 years later having a sum of money to PAY OFF the car is not a problem for me... is it realistic I go lease the car instead of financing AND pay a large lease downpayment?

My main objective: to pay a tiny monthly payment each month. That is the most important thing for me.

We all know a lease in California for an M4 is about 850+ per month, and the same car financed would be 1200+ per month or in that range. I Do Not Want To Pay So Much Each Month.

You can do whatever you want. The dealership will take your money happily regardless. Nobody here knows your situation and if it is a "smart" decision or not.

Personally, I bought my car around your age. It wasn't the smartest decision, but I was happy with it. I'm in a sound financial position and can handle my terms. Would I do it again, probably not.

In the end, only you can figure that out. It sounds like you know what you want to do, and you "think" you can handle it. Will we sway your decision, it doesn't sound like it.

[TS29849228]

Originally Posted by damageprone

You can do whatever you want. The dealership will take your money happily regardless. Nobody here knows your situation and if it is a "smart" decision or not.

Personally, I bought my car around your age. It wasn't the smartest decision, but I was happy with it. I'm in a sound financial position and can handle my terms. Would I do it again, probably not.

In the end, only you can figure that out. It sounds like you know what you want to do, and you "think" you can handle it. Will we sway your decision, it doesn't sound like it.

Originally Posted by HPIA4v2

In general,
financing is not a good deal if you don't hang on to the car at least 6-years and in some cases longer due to non-linear depreciation curve.

As far as putting money down on lease, two things come to mind:
1)are you saving money on not paying MF interest on that down-payment. Can you get GUARANTEE better return on that downn-payment
2)Just look at your accident record in the past, if you pretty safe driver then OK to put down payment. the main argument always, if you total the car that down payment is gone on a lease.

only you can answers those questions.

Thank you....
You guys sure do put the dots on those i's...

I do plan on driving the car until it dies, I am not the type to switch cars every few years.
but... Thank you! Much much closer to pulling the trigger now. Cheers

[G35POPPEDMYCHERRY]

Originally Posted by TimmayShanticlause

Another question of mine: (Please excuse me if it is a stupid question)
Can I chose to lease the car IF I KNOW that the payment at the end of the lease to buy the car out: I can handle?

For example, I have a sum of money NOW for the downpayment and 3 years later having a sum of money to PAY OFF the car is not a problem for me... is it realistic I go lease the car instead of financing AND pay a large lease downpayment?

My main objective: to pay a tiny monthly payment each month. That is the most important thing for me.

We all know a lease in California for an M4 is about 850+ per month, and the same car financed would be 1200+ per month or in that range. I Do Not Want To Pay So Much Each Month.

First go to the leasing and purchsing thread and read the 101 thoroughly. and then read like four other articles of lease vs buy. once you understand residuals and moneyfactors then youll have better questions. once again not trying to be a dick. I was once in you boat and you have to learn the basics, or everything we say will go straight over your head. then you will have better questions.

[Automotive Goals]

You can also look in to BMW Select, which bmw offers. It is financing the car for 5 years and then having a ballon payment of about $25k at the end of the fiver years. This way in the 5 years you will be paying off $45k (if the car is $70k). With a $20k down payment, you will be paying off $25k, so your payments will easily be in the $400-$500 range. You just have to remember that you have to pay $25k more after the 5 years are up.

Most people will tell you that balloon payment option is usually the worst way to get the car, because you end up paying more finance charges over the years, but it is the easiest way to keep your monthly payments way down, if that is what you are after.

But to be honest, the only way you are not going to be paying finance charge, is if you walk in to the dealer and pay cash for the entire car. With BMW Select, you will just pay a higher finance charge over the years, then you would with financing or even leasing.

You can also use PenFed.org website. They also offer something like BMW Select. I actually used it on my previous M4 and was able to keep my monthly payment way down as well. I ended up selling my M4 after about a year and a half and got for it almost what I paid for it, so in the end, the low monthly payments just made it easier for me not to part with my money and at the same time, not really lose a lot.

There are a ton of things to consider when you finance, lease or go with BMW Select options. Number one thing with all these options, is to get the car for Invoice price or lower. You should definitely read through this forum, A LOT. People will provide you with information, that even most dealers do not have. The more info you have the better deal you will get, which should be your number one concern, before you even decide how you would prefer to buy or lease.

[TS29849228]

Originally Posted by G35POPPEDMYCHERRY

First go to the leasing and purchsing thread and read the 101 thoroughly. and then read like four other articles of lease vs buy. once you understand residuals and moneyfactors then youll have better questions. once again not trying to be a dick. I was once in you boat and you have to learn the basics, or everything we say will go straight over your head. then you will have better questions.

Will do, and thank you for the input

[TS29849228]

Originally Posted by Ecoce1

You can also look in to BMW Select, which bmw offers. It is financing the car for 5 years and then having a ballon payment of about $25k at the end of the fiver years. This way in the 5 years you will be paying off $45k (if the car is $70k). With a $20k down payment, you will be paying off $25k, so your payments will easily be in the $400-$500 range. You just have to remember that you have to pay $25k more after the 5 years are up.

Most people will tell you that balloon payment option is usually the worst way to get the car, because you end up paying more finance charges over the years, but it is the easiest way to keep your monthly payments way down, if that is what you are after.

But to be honest, the only way you are not going to be paying finance charge, is if you walk in to the dealer and pay cash for the entire car. With BMW Select, you will just pay a higher finance charge over the years, then you would with financing or even leasing.

You can also use PenFed.org website. They also offer something like BMW Select. I actually used it on my previous M4 and was able to keep my monthly payment way down as well. I ended up selling my M4 after about a year and a half and got for it almost what I paid for it, so in the end, the low monthly payments just made it easier for me not to part with my money and at the same time, not really lose a lot.

There are a ton of things to consider when you finance, lease or go with BMW Select options. Number one thing with all these options, is to get the car for Invoice price or lower. You should definitely read through this forum, A LOT. People will provide you with information, that even most dealers do not have. The more info you have the better deal you will get, which should be your number one concern, before you even decide how you would prefer to buy or lease.

I am going to do all of that after work today, and thru the weekend.... Will look into this deeply. Thank you!

[GrahamSP]

I put 50% down. But my end goal was to own the car outright. I did Euro Delivery and had an OTD price of $64k. Put $32K down. Payment was $595/month. Paid the other $32K off in a year. Now have the title clean and clear. All depends on your end goal in my opinion. I do not like having monthly payments and like owning all my assets.

Totally understand the time value of money and putting that down payment in the market and such, but I just don't like debt. So peace of mind was a big factor for me.

Looks like you said having the lowest monthly payment is important and that you plan to drive it until it dies. So why wouldn't you want to put as much down as possible and pay it off as soon as possible in order to reduce your interest paid?

[vip]

You should not be putting any money down for a lease period!!!

That is money you will never see again, especially if you get into an accident [total the car] or turn the car in after 3 years.

[TS29849228]

Originally Posted by GrahamSP

I put 50% down. But my end goal was to own the car outright. I did Euro Delivery and had an OTD price of $64k. Put $32K down. Payment was $595/month. Paid the other $32K off in a year. Now have the title clean and clear. All depends on your end goal in my opinion. I do not like having monthly payments and like owning all my assets.

Totally understand the time value of money and putting that down payment in the market and such, but I just don't like debt. So peace of mind was a big factor for me.

Looks like you said having the lowest monthly payment is important and that you plan to drive it until it dies. So why wouldn't you want to put as much down as possible and pay it off as soon as possible in order to reduce your interest paid?

I think this was the answer that I was looking for....
Still i will research in this forum like all the other users have suggested I do...

But Thank You!!! I am going to shoot for something along these lines:
Finance, pay a downpayment around 20-30k and pay somewhere in the 500 range per month for 1-2 years..

Thanks!

[TS29849228]

Originally Posted by vip

You should not be putting any money down for a lease period!!!

That is money you will never see again, especially if you get into an accident [total the car] or turn the car in after 3 years.

Yea...
My understanding of "Lease with option to Buy Out" is a little bit skewed.
Thanks for the advice, I will not make this mistake.