[BMdoubleUTIFUL]

Originally Posted by LBBF87

This is my first time leasing and not paying cash (not a loan - cash) so I apologize if this is a stupid question as I know nothing about BMW FS or the process.

I went to a dealer today, agreed on 3.5% off and put down a $1000 deposit on a AWD build.

Now correct me if I'm wrong but MF and Residuals will be negotiated within 90 days of delivery and worrying about them now is not possible.

I (maybe stupidly) did not talk about MF with my CA.

Definitely find out what MF you agreed to because that could be the difference between a 2% interest rate or 3%. The numbers you agreed to when you put the deposit and ran your credit will be the final numbers, unless the residual gets better in your favor or the MF gets better in your favor at the time of pick up

[LBBF87]

Originally Posted by BMdoubleUTIFUL

Definitely find out what MF you agreed to because that could be the difference between a 2% interest rate or 3%. The numbers you agreed to when you put the deposit and ran your credit will be the final numbers, unless the residual gets better in your favor or the MF gets better in your favor at the time of pick up

That's the thing - to my knowledge we did not agree to anything. They ran my credit today but I never heard anything back after that.

Is there a number I should be shooting for?

[BMdoubleUTIFUL]

Currently .00086 is the base MF. Dealers have the choice and ability to raise the MF .0004 to .00126. So they may cut you a deal with money off the msrp but they will hit you with the higher MF to make up some of that money that they took off.

From what I've experienced, if they run your credit then they should have numbers drawn up. But seeing as how the awd has not released any pricing guides and there is no way to know what the upcharge for awd will be, then maybe they won't lock you into MF and residuals right now

[Jcali86]

They can't do anything if you're ordering an awd as they don't have the info; they don't even know what xdrive will cost extra. You're the same as me; we're in line to discuss these terms and order a car the second they are able to.

[LBBF87]

Originally Posted by Jcali86

They can't do anything if you're ordering an awd as they don't have the info; they don't even know what xdrive will cost extra. You're the same as me; we're in line to discuss these terms and order a car the second they are able to.

Originally Posted by BMdoubleUTIFUL

Currently .00086 is the base MF. Dealers have the choice and ability to raise the MF .0004 to .00126. So they may cut you a deal with money off the msrp but they will hit you with the higher MF to make up some of that money that they took off.

From what I've experienced, if they run your credit then they should have numbers drawn up. But seeing as how the awd has not released any pricing guides and there is no way to know what the upcharge for awd will be, then maybe they won't lock you into MF and residuals right now

Thanks guys - I thought I had royally F'ed up.

[LBBF87]

The dealer got back to me and hiked the MF to .00124. What's the best approach to take when in this situation?

I am assuming I can just walk if they won't budge even with a deposit down.

Edit the include the entire deal:

MSRP (Before AWD Pricing) - $83950
3.5% Discount
$1000 College Credit
$500 Loyalty
$500 CCA Rebate
Total Discount - 6.25%

Do I include the CCA rebate as a discount?

Everything seemed fine and dandy but the MF is indeed 00126...

[BMdoubleUTIFUL]

The higher MF is probably equivalent to an extra $1000-$2000 through the life of the lease. There are brokers that can get you 7% off a rwd so they may be able to assist when the awd releases

[snareman]

Originally Posted by LBBF87

The dealer got back to me and hiked the MF to .00124. What's the best approach to take when in this situation?

I am assuming I can just walk if they won't budge even with a deposit down.

Edit the include the entire deal:

MSRP (Before AWD Pricing) - $83950
3.5% Discount
$1000 College Credit
$500 Loyalty
$500 CCA Rebate
Total Discount - 6.25%

Do I include the CCA rebate as a discount?

Everything seemed fine and dandy but the MF is indeed 00126...

The BMWCCA discount is something you do on your own after you get the car and they will mail you a check separately. So, it's sort of part of the discount, but not really. More of a rebate.

[doug_999]

You could say, I'd like to get closer to the "buy rate". That's the rate they get from BMWFS.

MOST dealers mark up the Money Factor - but they can never play with the residuals.

As I've noted before, you should be working on your lease payment. So you could go back to the dealer and say "I get that you are raising the MF on me, the lease price I need to be at is.... and I'm not putting anything down other than first payment and security deposit, so I'm going to need you to make this work"

From there, they can increase the discount on the car or adjust the MF.

But spend some time getting the correct monthly price you wanna be at - lots of people can help you on what that is based on your state and the taxes and the lease inception fee (don't forget that).

*as noted, the BMW CCA rebate is separate and timing is everything. If you forget to file your paperwork in time, no rebate for you - and they will not budge on this. So DON'T FORGET.

[jmg]

Originally Posted by CanesM4

The MSD's arent as good as they used to be. You used to be able to reduce the money factor by .00049. Now the most you can do is .00028.

It's still free. If you have the cash might as well since you get it back regardless.

[jmg]

Originally Posted by LBBF87

The dealer got back to me and hiked the MF to .00124. What's the best approach to take when in this situation?

I am assuming I can just walk if they won't budge even with a deposit down.

Edit the include the entire deal:

MSRP (Before AWD Pricing) - $83950
3.5% Discount
$1000 College Credit
$500 Loyalty
$500 CCA Rebate
Total Discount - 6.25%

Do I include the CCA rebate as a discount?

Everything seemed fine and dandy but the MF is indeed 00126...

Only the discount off MSRP is technically a discount. All those others are incentives that have nothing to do with the dealer discount to you. 3.5% is pretty low considering what others are getting. They are using those incentives to try and get you to pay more than market value. Aim higher.

[LBBF87]

Originally Posted by jmg

Only the discount off MSRP is technically a discount. All those others are incentives that have nothing to do with the dealer discount to you. 3.5% is pretty low considering what others are getting. They are using those incentives to try and get you to pay more than market value. Aim higher.

Really? My understanding is 3.5% on an AWD allocation is really fairly decent. Most of the brokers are getting 3-5% on RWD allocations. From BMWs perspective, the AWD is going to be far more popular as well.

Maybe I am wrong?

[BMdoubleUTIFUL]

Originally Posted by LBBF87

Really? My understanding is 3.5% on an AWD allocation is really fairly decent. Most of the brokers are getting 3-5% on RWD allocations. From BMWs perspective, the AWD is going to be far more popular as well.

Maybe I am wrong?

I feel like the allocation will still be for a M3/M4 competition. The xdrive will just be an added option, so theoretically the xdrive shouldn't be any different when negotiating a rwd allocation

[jmg]

Originally Posted by LBBF87

Really? My understanding is 3.5% on an AWD allocation is really fairly decent. Most of the brokers are getting 3-5% on RWD allocations. From BMWs perspective, the AWD is going to be far more popular as well.

Maybe I am wrong?

Until the first AWD models get sold it's all speculation that favors the dealers. Of course they are going to lean on speculation that allows them to discount as little as possible. Think about this: if the AWD is going to be that popular, why discount at all? Also, 3.5% is low, but 5% is better. 10% is good. If everyone is getting 3-5% then that's the starting point. It's funny because 10% discount is usually
my starting point, and I try to go up from there. They've already won the advantage because now we're convinced that AWD is desirable and 5% is the highest we will get.


Convincing customers that incentives are discounts is part of the game. Incentives don't come from the dealer. They come from BMW corporate, subsidies, or the financial institution. Loyalty is from BMW Finance for example and ALL the dealers will have this, so when making the dealers compete with one another, take it out of the equation.

[matmanx1]

Originally Posted by M3AWD

I think discounts will improve on the RWD M3/M4 when the AWD version is officially launched in a few months (production starts July), and then I expect even higher discounts on the 2022 M3 around Spring/Summer of 2022 when the 3 series LCI is launched which will change at least the tail lights of the 2023 M3 and most likely the dash from what I heard.

This is when I will most likely be seriously in the market for my next ride. The warranty on my E450 coupe runs out in September of 2022 and I will most likely want to be in something else by then. Not that it's been a troublesome car, it hasn't at all. But with the air suspension and large amount of electronics controlling cars these days I can't say my trust is very high for long term reliability. And while the E450 is a fantastic cruiser I can't say it's terribly exciting and I genuinely miss shifting my own gears.

Anyway, I've always purchased/financed and usually do CPO but from what I have seen so far of the new M3 I am actually very interested in possibly leasing a brand new one if I can get a good deal. I've not kept a "fun" car for more than 2 or 3 years in a long time so realistically financing doesn't make a lot of sense for me on a purchase like that. I'll definitely be keeping an eye on these numbers as we move into 2022.

[KevinGS]

Originally Posted by Werkz12

Bottom line for a lease: you absolutely MUST focus on:
1. selling price / the discount you are (or are not) getting is key
2. residual
3. money factor

Without all three inputs you can not make an informed decision.

You can and should expect about a 5% discount.
On a $77,445 MSRP M3 expect a ~$4,000 discount.

$77,445 MSRP
Selling price of around $73500
36 month / 10k mile lease breaks down:

.00126 MF
57% residual
$1,050 month payment including taxes (this is based on PA tax)
$2000 total due at signing (not cap cost reduction - just $2k total out of pocket)

If you can negotiate BETTER than this that is great.
I would not consider paying any more on a G80 M3 lease.

Very insightful, Werkz, just what I needed to make sure my thinking is on the right track. Thanks!

Like you, I know I'm not keeping this car beyond 3 years, but would love to be able to get out of it in 1 or 2 years, so just know that I may be IMing you later to figure out how to do that.

[jmg]

Originally Posted by KevinGS

Very insightful, Werkz, just what I needed to make sure my thinking is on the right track. Thanks!

Like you, I know I'm not keeping this car beyond 3 years, but would love to be able to get out of it in 1 or 2 years, so just know that I may be IMing you later to figure out how to do that.

It's easy to get out of it you negotiate a killer deal. A good deal will be attractive for those who would like to take over your lease, which BMW accommodates relatively easily.

[KevinGS]

Originally Posted by jmg

It's easy to get out of it you negotiate a killer deal. A good deal will be attractive for those who would like to take over your lease, which BMW accommodates relatively easily.

Ah OK

[OSee]

There’s a credit union out in Pasadena with a balloon payment loan with an option to walk away at the end (CarFax be damned). Their residual (beats BMW by a mile) is partially based on pre agreed to mileage and you cover overage at .10 a mile. Just like a lease.

Not a catch in site.

Looking at the lease ‘deals’ everyone is getting this seems like a likely route for me. Especially since Im leaning towards buying this car but I’m not sure what the 2 LCIs are going to bring.

There are a few other Credit Unions that also offer this product. PenFed promised a walk away option last year but alas nowhere to be found.

[chicagofan00]

Originally Posted by OCfromOC

There’s a credit union out in Pasadena with a balloon payment loan with an option to walk away at the end (CarFax be damned). Their residual (beats BMW by a mile) is partially based on pre agreed to mileage and you cover overage at .10 a mile. Just like a lease.

Not a catch in site.

Looking at the lease ‘deals’ everyone is getting this seems like a likely route for me. Especially since Im leaning towards buying this car but I’m not sure what the 2 LCIs are going to bring.

There are a few other Credit Unions that also offer this product. PenFed promised a walk away option last year but alas nowhere to be found.

What's the name of the credit union? Any stipulations to being a member of the credit union to get that loan?

I'm working on a select financing option right now for an M3 so would be curious to know more.

[doug_999]

Originally Posted by OCfromOC

Not a catch in site.

Uh.... I think some states tax those deals differently. So there could be a catch depending on where you live.

Originally Posted by Werkz12

You can and should expect about a 5% discount.
On a $77,445 MSRP M3 expect a ~$4,000 discount.

I don't think anyone should expect a 5% discount on a car that just came out, is getting some pretty decent reviews, and plenty of people are saying "doesn't look as bad in person"

I know that if I tried that with my dealer he would laugh at me. Then again, he knows I'm headed to the dark side

[CanesM4]

Originally Posted by doug_999

Uh.... I think some states tax those deals differently. So there could be a catch depending on where you live.



I don't think anyone should expect a 5% discount on a car that just came out, is getting some pretty decent reviews, and plenty of people are saying "doesn't look as bad in person"

I know that if I tried that with my dealer he would laugh at me. Then again, he knows I'm headed to the dark side

I got a little over 9% off of msrp but this will be the fourth M car I've gotten from this dealer. Discounts are out there for sure