Here’s our first stab at a brand-specific Wiki. With all the activity on Leasehackr Forum, it’s easy to lose track of the knowledge being shared. The purpose of this Wiki is to be a central repository for all things related to leasing a BMW.
Please feel free to contribute! This is an ongoing document that relies on crowd sourcing our knowledge and experiences.
Expected Discount/Selling Price
This is very generalized information, but discounts vary by location, time, and model. Search for recent transactions. A sedan like the 3-series will likely be discounted more than an SUV, or an all-new, redesigned model.
Money Factor (MF) Information
The baseline MF is set by BMW Financial Services, but a BMW dealership can mark up the MF by up to .0004.
Historic MF Data
Unlike most other brands, the money factor for BMW FS leases is the same regardless of model (with rare exceptions).
09/2019: .00128 MF
05/2019: .00165 MF
03/2019: .00177 MF
01/2019: .00188 MF
10/2018: .00182 MF
05/2018: .00166 MF
01/2018: .00152 MF
03/2017: .00140 MF
12/2016: .00134 MF
09/2016: .00136 MF
Methods to Manipulate the MF
The MF can be manipulated via:
- Multiple Security Deposits (minus .00005 per MSD, up to a maximum of .00035)
- a One-pay lease payment (minus .0003)
- Acquisition Fee waiving (plus .0005)
Multiple Security Deposits (MSD)
With BMW FS, you can reduce your monthly payment by placing multiple security deposits upfront. Unlike a down payment (i.e., a capitalized cost reduction), you get this amount back at lease-end. MSDs work by lowering the money factor (MF) on a lease. MF is essentially the interest rate on a lease; lowering the MF reduces the finance charge you pay.
A security deposit is equal to your monthly payment (including tax) rounded to the nearest $50. A maximum of 7 security deposits are allowed up to a maximum of .00035. Each security deposit lowers the money factor by .00005. MSDs can be a good ROI.
Related thread(s): Downside of MSDs?
You can choose to pre-pay 100% of the lease payment in exchange for an MF decrease of .0003.
Waive Acquisition Fee
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.
Executive and Demo Cars
Exec/Demo cars can be leased and qualify for lease cash, loyalty + recent grad provided an equivalent new model of the same year has lease support from BMWFS. MSDs, USAA and OL codes can also be used, provided the vehicle has less than 5,000 miles. Mileage under 5k is subject to a residual reduction of $0.25/mile less 500 miles. EX: loaner has 5000 miles. Penalty would be 5000 - 500 miles *.25 = $1,125 residual penalty.
If the loaner has > 5,000 miles, there is a further 7% residual drop in addition to the mileage penalty. You will also lose ANY incentives (Lease Cash, USAA, OL Codes, ETC…)
If the loaner has > 7,500 miles, there is a 9% residual drop in addition to the mileage penalty.
You will also lose ANY incentives (Lease Cash, USAA, OL Codes, ETC…)
Corporate/Demo loaners would continue to receive the free maintenance plan for 3 years/36k upon lease inception. However, the clock starts on initial in-service date, NOT the date of you beginning the lease. In other words, if you take a 3/36 term 6 months and 5,000 miles after the car was put into demo service, you would receive 30 months/31k miles of coverage. The same would apply for warranty coverage.
Build Out/Option Credit
Driving Event or OL Code
Corporate Fleet Program
Beginning 1/1/2019, the Corporate Fleet Program has changed.
Corp Fleet is a specified discount off MSRP and it is different on every model. It cannot be combined with any Lease / APR, Conquest or Loyalty Credits. It is also NOT available to customers who currently own a BMW or have owned one in the last 12 months.
Dealerships do not have access to the list of approved companies either. Customers must apply for the Corporate Sales Program (CSP) claim certificate via their employee benefits web portal and present the certificate at time of purchase or factory order. They must also provide a recent paycheck stub from within the last 30 days along with a copy of their vehicle registration.
ED is less advantageous than before, but it’s a great experience and good for those who want to custom order their BMW.
BMW adjusted their maintenance program from 2017 model years to be less beneficial. While it still includes free basic servicing it only covers 3 years or 36k miles and no longer covers items like brakes. Reference: https://www.bmwusa.com/explore/bmw-value/bmw-maintenance/terms-and-conditions.html
Ultimate Care and Ultimate Care+ can be purchased to reduce cost of servicing beyond the 3 year or 36k mile period for higher mileage leases. Reference: https://bmwusaservice.com/ultimatecare
Excess Wear and Tear
Wheel and Tire Insurance
BMW Car Club of America provides a means for members to obtain a post-sale rebate from the purchase or lease of new cars under 1,000 miles. Loaners are not applicable. Rebates range from $250 to $1,500 based on model. Individuals who purchase a club membership of three or more years will now immediately qualify for the Membership Reward Rebate Program. A 3 year membership costs $134.00.
To obtain membership, and to learn more about the rebates, and the club please click the link below: https://www.bmwcca.org/vehicle_rebate
BMW FS charges a disposition fee of $350 for all leases. This fee is waived if you lease or finance a vehicle through BMW FS within 6 months of your prior BMW lease finishing.
Unused Mileage Credit
BMW will offer a mileage credit in certain circumstances if you are under your contractual mileage. The credit should be added to your FS account upon leasing a new vehicle.
Percent of Contractual Miles not Utilized
Credit Offered for Unused Mileage
Example: If you have a 2 year/20k lease, and you used 18k miles, you would receive a $200 credit.
Should you ground the car early, this lease credit would not apply.
NOTE: There have been reports of individuals having to reach out to BMWFS to apply the credit. Please keep your eyes on your account to ensure the credit was issued, should you be eligible.
BMW allows lease transfers at any point prior to the final 6 months of the lease term. The lease transferral fee is $500, $400 of which is returned if the application is rejected. Due to the nature of financial companies being risk averse, most will require the prospective lessee to have very good credit.
Lease transfers can be a good way of getting a good value short term lease, however they do come with downsides:
- The new lessee takes full responsibility for any damage or liability on the vehicle. A professional inspection would be one way to mitigate the risk involved.
- MSDs are not returned by BMW until the end of the lease so would need to be resolved between the original lessee and the new lessee.
- Standard free maintenance does not transfer to the new lessee. BMW Ultimate Care paid maintenance can be transferred to the new lessee.
- Lease transfers can take weeks to complete.
Alternative Financial Products - Owners Choice (for TX, GA, IL)
BMW has a special financial product for Texas, Georgia and Illinois called Owners Choice which is similar to a balloon loan but with the advantages of a lease. It was intended to circumvent the issues related to customers potentially paying double tax on a lease and then taxed again on the vehicle buyout. Owners Choice puts the vehicle registration under the customers name to avoid the double taxation, this means for PHEV’s that have not been registered that the customer can benefit from the Federal and State tax rebates creating some of the best deals possible.