Hey guys, I'm selling my car coming up and I've been trying to figure out what to buy. After tossing many idea's, I've thought of something that would work great for me. This would be to Lease a used 03' 04' M3 to keep the payment lower, then at the end of the lease, buy out the car, and be able to finance the money needed, but again, my payment will be lower because of the depreciation of the car.

But my question is would it be a good bit cheaper to lease a used M3 over a new one? I want to keep my payment under 500, And I figure I can lease a new 330 for about 450 a month, and thats with a 38k sticker. So could I lease a used M3 with a value of under 40 and still have a payment of under 500? It seems like it makes sense, but I'm just not really sure how leasing used cars works. I know in the end I'd end up spending more money on buying the lease out at the end, but I'm more worried about the payment. Any comments would be great!!!!! please give any advice if you can haha, thanks a lot everyone- Adam West

You would have to lease from some third party (business) that was in the car leasing business. Finding one of them with a M3 would be rare. I don't really think you will come out ahead. Leasing is generally best when you don't want to keep the car.

Lease rates on used cars are usually nowhere as good as they are on new cars. Because these things can vary widely from one end of the country to another, your best bet would be to call up your local dealer that has car on the lot and see what they can do for you.

Hey guys, I'm selling my car coming up and I've been trying to figure out what to buy. After tossing many idea's, I've thought of something that would work great for me. This would be to Lease a used 03' 04' M3 to keep the payment lower, then at the end of the lease, buy out the car, and be able to finance the money needed, but again, my payment will be lower because of the depreciation of the car.

But my question is would it be a good bit cheaper to lease a used M3 over a new one? I want to keep my payment under 500, And I figure I can lease a new 330 for about 450 a month, and thats with a 38k sticker. So could I lease a used M3 with a value of under 40 and still have a payment of under 500? It seems like it makes sense, but I'm just not really sure how leasing used cars works. I know in the end I'd end up spending more money on buying the lease out at the end, but I'm more worried about the payment. Any comments would be great!!!!! please give any advice if you can haha, thanks a lot everyone- Adam West


Yes you can lease a 2003 M/Y or newer car, but the money factors do tend to be higher. Here is a website you can check out for actual quotes from banks:

www.leasecompare.com

Used car leases tend to have much lower residual values, which usually makes them cost more per $1000 borrowed than the deals they offer on new BMW's. I ran a test for a 33k miles 2003 m3 with a 36,000 purchase price and it came back with 646 a month and a 19 k residual. Here are their numbers:

Program


Bank Lease A

Lease Payment


$646 per month

Term


36 Months

Mileage Allowance


36000 Total Miles

Residual Value


$19,321

Money Factor


0.00267

Purchase Option


$19,671

Gap Insurance


Included

Down Payment


$0

Due At Signing


$646 + sales tax and title fees

Fee


Amount
Included Due at signing

Due at lease end*

Lease Turn-in Fee


$395


Mileage Penalty


$.18 per mile

If you plan on leasing and then just buying the car later, you're absolutely making the wrong decision. Save your money for a couple months then just buy the car you want. Or buy an 02 to save money.

adam, i can get you a lease on a used m3 thru lease compare. to the person who said his idea is a horrible decision, not neccesarily. Lately a lot of the leasing companies, especially bmw fs, have been overestimating the residual value of all the cars, partially cause they have to to keep monthly lease payments affordable to actually move the units. It might not be the best idea to then buy the car out at the end of the lease but for the most part the residual values for m3's are always on the money.

adam, i can get you a lease on a used m3 thru lease compare. to the person who said his idea is a horrible decision, not neccesarily. Lately a lot of the leasing companies, especially bmw fs, have been overestimating the residual value of all the cars, partially cause they have to to keep monthly lease payments affordable to actually move the units. It might not be the best idea to then buy the car out at the end of the lease but for the most part the residual values for m3's are always on the money.

I'm not saying leasing a used car is always a bad idea. (I do believe it's a bad idea for most people as a huge poortion of the market here is leasing for the wrong reasons, but that's another post...)

But in the OP's case, he said he wants to lease a used car then buy it later. This *WILL* cost him more than buying a car he can afford in the first place. Even doing a 6 year loan would probably be cheaper in the long run.

hey guys, thanks for all of the reply's. Everyone has a good point. Here is my problem though.

My car is getting near 100k miles. I'm moving to sonoma california in june or december, and I'm going to be extremely busy, to the point where I wont even be able to do my own maint. and will practically be working and doing school the entire time. I'm worried about if something goes wrong on my car, I'll be out of transportation and wont be able to get to the places I need to go to. So I've decided to sell my car, and put it into something with less mileage and a warranty. The problem is that my payment is already around 360 a month, and I cant spend to to much more then that on the new car I get. So what can I get with that payment?? A 350z? maybeeee a g35 coupe, e46 3'er? these are great cars, but they really arent me (bmw M fan lol) I just feel like by selling my car, I cant really get anything else that is as exciting and just plain awesome for the money.

But, If I can lease an 03' 04' M3 for under 500, keep that for a while, then when the lease is over, and the residual is around 19k, I can then finance the rest of it and have a payment of only 360ish or w/e. At the end of it, maybe I've spent even 5 grand more then if I were just to buy it outright, but thats ok with me, because the possibility of owning a newer M3 without leasing is an impossibility. So I'll be able to drive an M3 for years to come, have 0 maint, and hopefully have it all work out in the end. I just cant swing a 600+ dollar a month payment. Does this make sense to anyone? or am I in my own little world on this idea? haha :lol

apollo322 - thanks so much for that site, see I can put down a good size deposit, so that means that I can get the payment lower then 646 a month.

I would think that when leasing a used car the maintenance is on you, it's not like a new car with a warranty. A high end luxury sport coupe on a limited budget seems destined for disaster. Don't live beyond your means.

apollo322 - thanks so much for that site, see I can put down a good size deposit, so that means that I can get the payment lower then 646 a month.


I'm glad I could help amigo, I've thought about doing this on a few cars myself for a few reasons:

1. If you don't want to keep it you turn it back in without the hassle of selling it.

2. Leasing through my company allows me to write it off.

If you can put 4-5k down and are planning on buying the car later this deal works for you. You may end up paying about 2-3k more in finance charges by doing it this way, but if liquidity is an issue ( as it appears to be) then this is the way to go. Personally I'd much rather have a used m3 even if I did need to pay for maintenance for the same dollar cost as a new 330. Good luck to you.:buttrock

I would think that when leasing a used car the maintenance is on you, it's not like a new car with a warranty. A high end luxury sport coupe on a limited budget seems destined for disaster. Don't live beyond your means.

cpo with a maint package :D so that takes care of any maint.

and as far as a budget, I'm not to worried about it, My income will be fine, its just that I dont want to put everything into a car.

OK, good luck.

Leasing may work for you............but remember, you are not buildin equity and if something financially goes south and you can't finance the residual..........you are out of a car.

If you are in school, it might be better to just get something that you don't have to make payments on and get what you want when the time is right.

Applying a large cap reduction on a lease just goes against every financial bone in my body. Say you apply a $7k cap reduction to reduce your payment by $100/mo, consider how many years it takes to break even when you could have invested that same money and had it earn you a return? There's opportunity costs involved here that you aren't considering.

As others have mentioned, leasing used cars is far different than leasing a new car. The residuals are weak, the money factors are much higher, and there are far fewer lending institutions to shop around. That said, it can be done, particularly through BMWFS (although their rates are usually pretty high).

If you truly are planning on buying the car, then put it on a 6 or 7 year buy and forget the lease. At least you're building equity. I would only lease if your tax situation allows you to write off the payments.

BTW, if down time is a real consideration, the M3 might not be the best idea. Mine has been far from reliable in comparison to my previous e46 325cic.

thanks guys, I'm still confused as what to do. I can write the car off through my dads company so thats a plus, and the "school" im going to really isnt a school. Its the jim russel formula mechanic racing school which is a year long program. But I guess time will tell, I plan on listing my car for sale in april, and then I'll go from there. Thanks again for everyones help - Adam West