Looking to lease a BMW in NY. We don’t’ have MSD here so I was thinking about doing a one-pay lease to save on the interest rate.
I’ve been reading conflicting opinions on here about what happens in case of an accident where the car is totaled.
Does anyone know if insurance will pay back the remaining amount of the lease in case of an accident where the car is totaled? Some people say insurance will because of GAP (or some other insurance), but others have said that you loose the money.
Money is gone. One of the reasons most suggest little to no downpayment. Your MSD’s (if you did any) would be refunded once your insurance company made the lender whole though.
Your insurance company will pay the value of a totaled car. It does not matter if it was leased, financed had MSD or a pre paid lease. Most leasing companies keep the pre paid payments as a separate transaction. So you would be refunded the remaining payments in a totaled out situation. If it was a cap reduction (down payment) it could be lost if your upside down on the payoff vs value.
Thanks for the info.
If I understand correctly, it sounds like insurance will pay off whatever is remaining, which is only the residual value in the case of a one-pay lease since the dealer/BMW already got paid everything else at signing.
I see that the the one-pay discount is less than MSD discount, so MSDs is better value for those that can go out of state and afford the MSDs.
This is not correct. Stop spreading false information. BMW pro-rates one pay reimbursements when the vehicle is totaled. They essentially take the money out of the account monthly to pay the lease obligation (source: Bimmerfest)
Insurance pays whatever they value the vehicle. Doesn’t matter what you owe or what is left on a loan.
What he said!
I did a one pay lease and that was my experience. You just need to contact BMW Financial services to confirm if you need confirmation. Many will tell you that since you paid all upfront that it is lost in the event of a total loss but that just isn’t accurate. Buster11xx’s explanation is the simplest way I’ve seen it explained.
They essentially take the money out of the account monthly to pay the lease obligation (source: Bimmerfest)
Haha, this is the conflicting info I was referring to.
I don’t understand this sentence. Does BMW pay back pro-rated reimbursements to ME monthly if case of totaled car?
I asked this years ago as well. It will not be gone, BMW will give you a pro-rated amount of the one pay back once the insurance company sends them a check. This assumes the insurance company sends them the entire payoff amount.
I stand corrected! 
Yes. So if you have 12 months left on the lease, you will get back 12 months worth of payments. For example, if your one pay is $36,000 you will get back $12,000 (probably a little less due to start up fees).
Thanks everyone for looking at this. Glad I finally understand this.
It seems like the only downside of a one-pay for BMW is that you have to put cash upfront (opportunity cost of your cash).
Other than that it would make sense to do a one-pay to save .0003 on the MF if you cannot do MSD, which would save .00035.
FYI, my experience with MSDs in NY is that if you can go to a non-NY dealer, you can still use them. i.e., even if the car is registered in NY, using a dealer from NJ or CT, you can still use MSDs. Not sure if this is feasible for you, but it’s worth considering.
Does that require your to have GAP insurance or is that just in the case of a normal (non onepay) lease?
GAP insurance is included on basically every lease except Toyota
Not sure if Gap is included when using a 3rd party bank