OK, these numbers seem acceptable to me, but just wanted to run it by you leasing gurus and see what you think.
Yes, I know it's not the best deal in the world, and I know some of you have done way better, but since I want to do a Euro Delivery,
I forcibly need to go through BMW FS-- according to my sales guy, no other bank will lease a Euro delivered car. Anybody know if this is true?
Also, keep in mind this is LA and some dealers are still marking M3's up, so negotiating for under MSRP is next to impossible.

Anyway, here are the numbers...


MSRP: 56,000 - Car is sold at sticker. Competition Package, leather and a
thing or two more...

5K down - Yeah, I know it's not the smartest thing but I want to keep my payments down.
I'll be paying a $300 a week nanny so every penny counts :)

Residual 62% - Money factor 0.00225 - Monthly payment including tax $670.
This is on a 36 month lease and 10K miles a year.
Again, keep in mind this is through BMW FS.

The numbers seem right. There is one thing that bugs me though:
with such a high residual, shouldn't my payment be slightly lower?
I should be paying $670 with 14K miles a year, no?

What y'all think?

Why not just buy the car. How can you survive with that 12k a yr mileage? You can always sell the car in 3 yrs yourself.

Numbers look right (gotta love 62%, Asian/domestics cars can only dream of it). Keep in mind there is more to it than money factor and residual, BMWFS has an aquisition fee.

MSRP: 56,000 - Car is sold at sticker. Competition Package, leather and a
thing or two more...

5K down - Yeah, I know it's not the smartest thing but I want to keep my payments down.
I'll be paying a $300 a week nanny so every penny counts :)

Residual 62% - Money factor 0.00225 - Monthly payment including tax $670.
This is on a 36 month lease and 10K miles a year.
Again, keep in mind this is through BMW FS.

The numbers seem right. There is one thing that bugs me though:
with such a high residual, shouldn't my payment be slightly lower?
I should be paying $670 with 14K miles a year, no?

What y'all think?

The money factor is not great, but its not bad. .00225 x 2400 = 5.4% APR (approx)

http://www.efunda.com/formulae/finance/moneyfactor.cfm

$29,120 to drive a Comp. Package M3 for 36 months and 30k miles.

Your residual is $34,720, $21,280 of depreciation from $56k.

Your rent charge, i.e. interest and profit, is $7840 over the life of the lease.

Not a great lease, not a horrible lease. You are getting a desirable car right now, so you're paying MSRP and they are not giving you a break on the interest rate.

If you could buy the car at MSRP and pay a low interest rate, you could save about a few bucks.

You could finance it for $1006/month w/nothing down at 3%/60. (Your lease is just over $800 w/nothing down) Take your $5k and you have the excess amount over $670 ($336) covered for 15 months. Or you can buy for $916/month w/ the $5k down, and have only $246/month extra over the lease.

Buying will cost you more per month, but you will owe considerably less than the residual at 36 months into the loan:

Calculation Results

Loan Amount: $ 56000 | Term of the Loan: 5 years | Interest Rate: 3 %

Monthly mortgage payments: $ 1,006.25 | Total interest paid over the life of the loan: $ 4,374.80
Amortization Table

Year Loan Balance Yearly Interest Paid Yearly Principal Paid Total Interest
2005 45,460.91 1,535.87 10,539.09 1,535.87
2006 34,601.27 1,215.31 10,859.65 2,751.19
2007 23,411.31 885.01 11,189.95 3,636.19
2008 11,881.01 544.66 11,530.30 4,180.85
2009 0.00 193.95 11,881.01 4,374.80

So, if you buy instead of lease, you will only owe $23,411 after 36 months, versus having a residual of $34k. You will pay about $9k more in payments if you buy, but you still come out ahead.

All of this assumes you can get a lower interest loan. Drop the interest rate on the lease and you'll save money as well, but you won't lower the residual.

(gotta love 62%, Asian/domestics cars can only dream of it).

When I leased my TL, it was 57% after 42 months for the standard car, 55% with the Navi. Hondas have great residual value, as do most Toyotas. The G35 is also very good.

The NSX has the highest residual of any car in its class, even today. Take a look at the lease rate on a new NSX. They used to be $799/month with ZERO down, which is insanely cheap. Now its $799/month with a little bit down.

When I leased my TL, it was 57% after 42 months for the standard car, 55% with the Navi. Hondas have great residual value, as do most Toyotas. The G35 is also very good.

The NSX has the highest residual of any car in its class, even today. Take a look at the lease rate on a new NSX. They used to be $799/month with ZERO down, which is insanely cheap. Now its $799/month with a little bit down.

I know there are some cars that have good residuals as well, but not too many. Btw, I didn't know the NSX had such a great %. What was/is it?

42 month residual on '05 M3 = 58%.

I know there are some cars that have good residuals as well, but not too many. Btw, I didn't know the NSX had such a great %. What was/is it?

52% after FIVE years, 15k per year.

After looking at that list, I think you may want to reconsider your statement "not too many" in reference to Japanese cars.

http://www.edmunds.com/reviews/list/top10/102467/article.html

52% after FIVE years, 15k per year.

After looking at that list, I think you may want to reconsider your statement "not too many" in reference to Japanese cars.

http://www.edmunds.com/reviews/list/top10/102467/article.html

52 percent at 5 years is insane, very good. Btw, my reference was residual value, not resale value after 5 years (big difference). I said Asian cars not Japanese.

Automotive Lease Guide award winners (residual value) on Edmunds site.

Compact car: Mini Cooper
Midsize car: Volkswagen Passat
Near Luxury: BMW 3 series
Luxury: Mercedes Benz

Why not just buy the car. How can you survive with that 12k a yr mileage? You can always sell the car in 3 yrs yourself.

Well, I'll have no shortage of nice cars to drive. ;)
I'm keeping my slightly modded E36 M3. Also, my wife is getting an S4 Avant.

Then again, the E46 M3 might be so good I'll drive it everywhere and run out of miles in no time... We'll see.

brahtw8, let me first say that I totally agree with you. You're preaching to the choir here.
Secondly, thank you very much for the info and taking the time to write and work out the numbers.

Yes, leasing is indeed not the most financially savy route to take and I've never taken it before. I've always bought my cars used
(usually off leases) and always straight out financed them. However, this time around
there are other forces at work here that have actually made leasing a more attractive proposition for me--
I never thought I would say that... I'd rather not bore the hell out of everyone here stating my case.
You make a good argument though, and truthfully, I still haven't decided which route to take.
I know if I choose to lease I will pay a hefty premium for it and I've made my peace with it.
Also, sometimes in life you just have to treat yourself to a little luxury and not only think of the bottom line... :D
Unlike my E36 M3, I have no intention of keeping this car for more than 3 years. It's more of a purely transitional car for me. And as lazy as I might sound,
I just don't want to go through the whole ordeal of having to sell the car three years down the line. At that point I'll either buy the new M3
or just buy my exotic dream car used...

The money factor is not great, but its not bad. .00225 x 2400 = 5.4% APR (approx)

Apparently, that's as low as BMW FS will go on the M3 according to my sales guy.
And that's only with a 700 plus FICO score. Otherwise it goes up to 5.7.
Again, remember I'm tied to BMW FS because of the Euro Delivery.

Not a great lease, not a horrible lease. You are getting a desirable car right now, so you're paying MSRP and they are not giving you a break on the interest rate.

What would make this a good lease? How can I squeeze a lower payment,
given that the selling price and the money factor are not negotiable?
Can you do better on the lease given my circumstances?

Of course, I can always try an out of state dealer...

Probably going to end up leasing mine. 0 down, 42 month 10k a year for 840 a month. Then i will end up buying it at the end. Hopefully for cash so i don't have to take out a loan.

I've never leased a car, can someone explain residuals, etc?

Does BMW lease CPO vehicles? I'm contemplating my next move...and I have my 98 M3 to sell and use the cash from, or trade in and apply towards a purchase.

Any thoughts or advise? I just bought a house, so keeping payments to a minimum is a necessity...that said, i don't "need" a new M3 either, it can be used!

What would make this a good lease? How can I squeeze a lower payment, given that the selling price and the money factor are not negotiable?

Can you do better on the lease given my circumstances?



I don't know if you can get a 'good' lease on a M3 w/Comp. package right now. I didn't mean to suggest that I could do better on the car, only that you were paying a bit of a premium to get that particular car.

I lease my TL, and I got it last fall when people were paying MSRP and waiting several months for cars to be built. That is just the reality of leasing the hot car.

http://www.alg.com/

Industry Brand Residual Value Rankings


RANK
BRAND
1 Honda
2 Toyota
3 Nissan
4 Volkswagen
5 Jeep
6 Subaru
7 Mazda
8 GMC
9 Chrysler
10 Ford

--------------------------------------------------------------------------------




Only brands above the industry average were ranked. Below industry average were the following brands (listed in alphabetical order): Buick, Chevrolet, Dodge, Hyundai, Isuzu, Kia, Mercury, Mitsubishi, Pontiac, Saturn, and Suzuki.

Luxury Brand Residual Value Rankings


RANK
BRAND
1 BMW
2 Lexus
3 Acura
4 Mercedes-Benz
5 Infiniti
6 Volvo

--------------------------------------------------------------------------------




Only brands above the luxury average were ranked. Below luxury average were the following brands (listed in alphabetical order): Audi, Cadillac, Jaguar, Land Rover, Lincoln and Saab.

Note: All brands with vehicles in at least three segments and minimum annual volume of 40,000 units were included. As a result of this requirement, MINI and Porsche as well as other brands were excluded from the above rankings.

Based on ALG's 2005 Brand Study. For more information on this service or any other questions, please contact Matt Walker at 805.563.0777 x116, or email: mwalker@alg.com.

Automotive Lease Guide award winners (residual value) on Edmunds site.

Compact car: Mini Cooper
Midsize car: Volkswagen Passat
Near Luxury: BMW 3 series
Luxury: Mercedes Benz

A very selective list. The Japanese won every other category save 1, CUV (Volvo XC90). The rest of the winners:

Midsize: Nissan Altima
Near Luxury G35
Minivan Honda Odyssey
Compact SUV Honda CRV
Midsize SUV Toyota 4runner
Fullsize SUV Toyota Sequoia
Compact Truck Toyota Tacoma
Fullsize Truck Toyota Tundra

http://www.alg.com/news-information.asp?page=news_alg_rva

Very selective list yes...but there very selective cars. :)

You can twist residuals and resale anyway you want..European cars are usually higher than there domestic/Asian counterparts. For example the 3 series was top in the near luxury class in '04 (the platform dates back to 1999 so 5 years old). A domestic/Asian car can't come close to this residual when there are this old in design. The last model TL type S in it's final year of production held a strong 48 percent residual in 3 years! E46s are still high 50s low 60 percentages. Again, unheeard of in the domestic/Asian market.

Very selective list yes...but there very selective cars. :)

You can twist residuals and resale anyway you want..European cars are usually higher than there domestic/Asian counterparts. For example the 3 series was top in the near luxury class in '04 (the platform dates back to 1999 so 5 years old). A domestic/Asian car can't come close to this residual when there are this old in design. The last model TL type S in it's final year of production held a strong 48 percent residual in 3 years! E46s are still high 50s low 60 percentages. Again, unheeard of in the domestic/Asian market.

Where did you get 48% over 3 years for the 2003 TL?

Edmunds has the 2003 at 48% after 5 years. No 3 series on this list:

http://applications.edmunds.com/reviews/list/top10/99268/article.html

Nobody is twisting anything. I have posted straightforward, factual information, and I haven't intentionally omitted facts that were not helpful to my position . . .

As for "old in design," it doesn't get much older than the NSX. The G35 and Altima are hardly new, either, but yes, they don't date back as far as the 1999 MY.

BTW, Asian seems to equal Japanese for you as well. I haven't heard you mention a Korean car yet . . .

Manufacturers data, not Edmunds is where I got the info. Like I said "counterparts", the NSX is awesome no doubt but there are very few cars in it's class. What European car competes with an Altima ot Tundra? Btw, both TL and RL were set at 48 percent their final year by American Honda at 3 years.

I hope I didn't upset you, I was saying anyone can twist data to favor there point, whether that be you or me. You are throwing out factual information. My intention wasn't to attack you.

Manufacturers data, not Edmunds is where I got the info. Like I said "counterparts", the NSX is awesome no doubt but there are very few cars in it's class. What European car competes with an Altima ot Tundra? Btw, both TL and RL were set at 48 percent their final year by American Honda at 3 years.

I hope I didn't upset you, I was saying anyone can twist data to favor there point, whether that be you or me. You are throwing out factual information. My intention wasn't to attack you.

No worries, mate. Just having a little fun arguing with you and avoiding work on a Friday.

I forcibly need to go through BMW FS-- according to my sales guy, no other bank will lease a Euro delivered car. Anybody know if this is true?
What y'all think?

Im almost positive that this is true. BMW FS will be your only way on this deal, sorry man...

Well, since Euro Delivery is my number 1 priority here, then BMW FS it is...
After reading how some people have leases through BMW FS in the $800 range with $2.5 to $5K down, I don't feel so bad going through them...

One more question-- I could swear I read somwhere that sunroofs became standard starting this MY
and were no longer an option (sun roof delete would become an option). Was this simply a rumor or is there any truth to it?
Maybe it doesn't apply to M models... Do you still need to order this as an option?

This would raise my payments by like $20-- not a big deal but if I can avoid it, all the better.

If I don't get any answers here, I just might start a new thread...

'05 e46 models have sunroof and wood trim standard. The M3 remains the same (sunroof option or included in the Premium P.).

Damn, that's what I was afraid of... :mad
Oh, well. Thanks.

OK, finally closed the deal. Will put the order in tomorrow. :redspot

I'll quote these numbers for anybody who is also looking to lease.
Although it doesn't seem like a great deal, given that I need to go through BMW FS because of the Euro Delivery (best MF they'll offer on an M3 is .00210) and that two things were missing and not accounted for in the original quote-- namely, the acquisition fee and the guzzler tax, I think I did pretty well. That's an extra $1825...
I also made it a 12K mile a year lease.The numbers do add up, and I really can't see how to make them any better given these parameters.

On the plus side, I got them to sell me the car for $1700 under sticker. Not something easy in LA...
Either way the payment comes out to $670 a month with tax/$5K down.
BTW, despite whatever their slogan might say, Nick Alexander *can* and *will* say no...

Autobahn here I come... :buttrock