[PatientM]

Wanted to get everyone's take on those taking deliveries of their M3/M4 in the next 6 months are so; with interest rates on the rise and possible recession what's the best way to pay for this?

I was thinking 30% down and BMW select...or find a credit union?

[Lakeside]

I’m locked with the local dealer as a worst case. I’ll pay about $25k down and look for a credit union.

I’d love to pay cash but I’m also doing a home remodel so I need extra money for something.

[jmg]

Lease it an lock in your residual when you order the car. If the economy tanks, you still return your car in 36 months, no additional depreciation. If the car is worth more, sell it and pocket the additional residual.

[stevethegopher]

Originally Posted by jmg

Lease it an lock in your residual when you order the car. If the economy tanks, you still return your car in 36 months, no additional depreciation. If the car is worth more, sell it and pocket the additional residual.

Originally Posted by jmg

Lease it an lock in your residual when you order the car. If the economy tanks, you still return your car in 36 months, no additional depreciation. If the car is worth more, sell it and pocket the additional residual.

I've never done a lease before, can you explain this a bit more? How does the "if the car is worth more" case work?

[forcefed]

Cash

[Znomorph4theWin]

Originally Posted by forcefed

Cash

😂

[DocWeatherington]

It's a numbers game...have to do the math on which option is best for your situation... All come with pros and cons.

Moral of the story get the lowest price possible and the lowest rate and don't buy anything you can't afford.

[Gfit]

Originally Posted by jmg

Lease it an lock in your residual when you order the car. If the economy tanks, you still return your car in 36 months, no additional depreciation. If the car is worth more, sell it and pocket the additional residual.

This is what I do every time. I look at is as paying as I use it. Last few cars, I was able to take advantage of the equity by selling early. Most I give back at the end because BMW, in normal times has inflated residuals. Also, my wife is a magnet for other peoples bumpers (never had a claim on our policy) so a few times the cars had some serious diminished value and just turned them in.

[Fugly M3]

Originally Posted by jmg

Lease it an lock in your residual when you order the car. If the economy tanks, you still return your car in 36 months, no additional depreciation. If the car is worth more, sell it and pocket the additional residual.

Originally Posted by Gfit

This is what I do every time. I look at is as paying as I use it. Last few cars, I was able to take advantage of the equity by selling early. Most I give back at the end because BMW, in normal times has inflated residuals. Also, my wife is a magnet for other peoples bumpers (never had a claim on our policy) so a few times the cars had some serious diminished value and just turned them in.

Didn't BMW change the lease terms (like everyone else) when covid happened and values skyrocketed to prevent people from doing this?

[anakratis]

50% down 50% finance

[Draper]

Originally Posted by jmg

Lease it an lock in your residual when you order the car. If the economy tanks, you still return your car in 36 months, no additional depreciation. If the car is worth more, sell it and pocket the additional residual.

The downside to this is you are paying ~6% plus an extra $975 acquisition fee (and a $350 disposition fee if you turn it in). This could be an extra $4-6K over 3 years.

I just have a hard time believing values are going to fall off a cliff and sink below the current residuals, which are currently in the mid-50s.

[DocWeatherington]

Originally Posted by Draper

The downside to this is you are paying ~6% plus an extra $975 acquisition fee (and a $350 disposition fee if you turn it in). This could be an extra $4-6K over 3 years.

I just have a hard time believing values are going to fall off a cliff and sink below the current residuals, which are currently in the mid-50s.

If you lease another car some of those fees are waived and depending upon time of year they bmw gives lease cash.

Also have to think about the tax implication as some states only tax the monthly vs. Full amount everyone has to do net cost.

[DocWeatherington]

Originally Posted by forcefed

Cash

Cash is good but if the stock market is down 30% off it's high it may be of interest to take a loan if you can find a good rate and invest as buy low sell high.

And even if it's 8% compounded per year that's still better then a 36month at 6.99 for 100k.

[Draper]

Originally Posted by DocWeatherington

If you lease another car some of those fees sre waived and depending upon time of year they give lease cash.

Also have to think about the tax implication as some states only tax the monthly vs. Full amount.

Right. They waive the disposition if you lease (or buy?) another car...but pretty sure you pay a new acquisition with every lease regardless.

Even without the fees, the APR equivalent of the MF is not favorable.

[DocWeatherington]

Originally Posted by F8SEVEN

Didn't BMW change the lease terms (like everyone else) when covid happened and values skyrocketed to prevent people from doing this?

Yes and no...if your car has equity in it the bmw dealership may cash it out and give it to you but they don't have to. However, you can use other services that lease and buy cars and they will cash it out or another dealership that is part of a network. Aka sell it to Audi across the street but they fall within the same owner as BMW.

You just can't do Carmax a "third party" without then dealing with buyouts and taxes if applicable.

[DocWeatherington]

Originally Posted by Draper

Right. They waive the disposition if you lease (or buy?) another car...but pretty sure you pay a new acquisition with every lease regardless.

Even without the fees, the APR equivalent of the MF is not favorable.

It may or may not be as all APRs including MF are all up across the board. It will come down to which makes the most sense... That APR on 36 lease or 60 or 72 months with the full ride of taxes and the larger net cap of total interest. The higher payment of a lease maybe lower over the 36months and put one in an equitable spot. Unless you do a large down payment to reduce the payment and net interest paid. Then there is bmw select which has a balloon.

Not sure...i know if you keep using BMW FS either on a lease or buy some of fees get reduced or don't roll.

The acquisition fee for leases through BMW FS is $925. Dealers can no longer mark it up for additional profit. The acquisition fee can be waived in exchange for an MF increase of .0005, which may be more favorable for shorter lease terms.

[Gfit]

Originally Posted by F8SEVEN

Didn't BMW change the lease terms (like everyone else) when covid happened and values skyrocketed to prevent people from doing this?

They eliminated 3rd party buyouts like just about all finance companies but I've had good luck finding BMW dealers that will buy it out early and pocket $6k in equity.

[Danman5666]

Cash + Finance some of it.

[Draper]

Originally Posted by DocWeatherington

It may or may not be as all APRs including MF are all up across the board. It will come down to which makes the most sense... That APR on 36 lease or 60 or 72 months with the full ride of taxes and the larger net cap of total interest. The higher payment of a lease maybe lower over the 36months and put one in an equitable spot. Unless you do a large down payment to reduce the payment and net interest paid. Then there is bmw select which has a balloon.

Not sure...i know if you keep using BMW FS either on a lease or buy some of fees get reduced or don't roll.

The acquisition fee for leases through BMW FS is $925. Dealers can no longer mark it up for additional profit. The acquisition fee can be waived in exchange for an MF increase of .0005, which may be more favorable for shorter lease terms.

I couldn't remember if it was 925 or 975...so thanks. .0005 MF markup is equal to 1.2%, so IMHO no one should be doing this.

The F8x leases were in the $800 range which was an obvious slam dunk, the numbers are just not as sexy with the G8x.

[colo3Kid]

Took delivery in Dec 2021 @MSRP Ca$h
Those waiting now

[dct203]

Mine should be here between March-June. Worst case just do a 60-72 month finance and refinance as soon as rates come down. They won't be high forever. My credit union is under 4% still which isn't the worst.

[forcefed]

Originally Posted by DocWeatherington

Cash is good but if the stock market is down 30% off it's high it may be of interest to take a loan if you can find a good rate and invest as buy low sell high.

And even if it's 8% compounded per year that's still better then a 36month at 6.99 for 100k.

My idea of a good rate is 0% 😂