Quote:
Originally Posted by jjrandorin
You are getting some "half" answers here... Let me see if I can help.
1. If you buy the car from BMW FS, then you are paying the residual amount, and you shouldnt have to jump through all those hoops. You would cut a check to BMW FS for the residual amount, and they will tell you what to do next.
2. If you are trying to negotiate a price on the car that is LESS than the residual amount, BMW FS WILL NOT NEGOTIATE on the price. They dont negotiate on buyout pricing, the price is the price.
3. With Point #2 being made, the DEALER CAN buy the car from BMW FS, and sometimes for less (and sometimes much less) than the residual. If you want a price lower than the residual, you MUST negotiate with a dealer. It does not have to be the dealer you bought from, it can be any dealer you can take the car to.
The dealer gets a special buy out price from BMW that takes into account current auction pricing for the vehicle, so there may be a lot of room, or not much, depending on what your car would go for at auction.
If the dealer is selling the car to the person who leased it, there is an additional fee that is charged (ironically called a "loyalty adder", which sure is a stupid name for an additional fee that is charged when the person who leased the car buys it back). I dont know how much that fee is, its likely that it varies based on the vehicle. I KNOW it exists however, even though people dont talk about it much as I got that information from the "other" BMW board from a CA I trust.
Anyway, if you want to pay residual, you dont need the dealer for that to my knowledge. If you want to negotiate, you MUST do it through a dealer, and they will have their special buy out price, and then mark it up, and hopefully you two can come to an agreement on pricing where it benefits you both. If not, try another dealer.
So, its NOT TRUE that the dealer is just lying to you... they are just under the assumption that you want to buy the car from them, instead of directly through BMW FS. Of course, they may try to sell it to you for the residual amount anyway, because dealers want to make money. If you are not getting a discount off residual, and you are not looking to get the car CPO'ed you likely can avoid working with the dealer. If you want to try to negotiate the residual, you MUST deal with a dealer as again, BMW financial services WILL NOT NEGOTIATE the price of the car to an end user customer (they actually dont even negotiate with the dealer.. they TELL the dealer what he will pay for the car).
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More GREAT info. Many thanks.
For full disclosure, the way this started for me was...
I told the dealer that I was interested in the option of buying out the lease, but didn't know how that process worked and would like to see the details. I didn't ask for any sort of discount on the residual and I also didn't specify whether I wanted to go through them or directly through BMW FS, largely because I didn't realize going directly through BWM FS was an option. They just presented me with their "deal" which was the full residual price plus >$500 in nebulously defined fees ($335 documentation fee + $250 safety check fee + to be determined repair costs). They also included the cost of state sales tax and the standard $135 registration and title fee, but both of those make perfect sense to me.
I'm comfortable with paying the full residual, especially since it happens to be right about in the range for market value around here (according to KBB). Knowing what I know now (thanks to everyone here), I'm planning on either going through BMW FS and just handle everything myself OR see if the dealer is willing to waive the various fees and potentially pass on some benefit they'll realize by purchasing the car on my behalf, maybe in the form of a nice discount on extended warranty or something like that. That feels like a fair ask on my part since I feel like they opened the door to that conversation by presenting their way as "THE" way this is done.