BMW X5 Lease Buyout

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1

As of right now, my 2019 BMW X5 has a buyout of $47,419 (this is INCLUSIVE of sales tax).

KBB Trade in is showing $52-55,000.

I understand I cannot sell my lease to a 3rd party dealer, however I am still in the green even with covering tax, so am considering just outright buying my car to open up other options for sale.

My question is around selling the car back to BMW.

  1. Am I able to sell this car to any BMW dealership still?
  2. Does BMW pay sales tax on this transaction? Or would they purchase it for $44,303 (sales tax NOT inclusive of my listed buyout price)

If they purchase the car without sales tax, does this create a larger delta for me in equity? Even if BMW came in lower than the others, this could be a better avenue and I would just compare the deltas between the deals. Just wondering what figures I am truly up against so I can evaluate best destination for the car.

Figures:
Buyout Price: $44,303
Sales Tax: $3,101

Thanks!

2

Yes any BMW dealer can buy it and no they don’t pay tax. Also if you’re within lease end window (~120 days) the dealer might get an even lower payoff amount, but unlikely in this case based on lease payoff vs. market value. (Ex. dealer gets lower of lease payoff or MMR based value)

3

  1. You can sell to any BMW dealership or network group that has BMW in their family.

  2. BMW dealers do not have to pay the sales tax, so their figure is the total from residual and remaining payments.

You need to consider what the dealer will give you vs buying outright, paying the sales tax and trying to flip it once you get the title.

I just sold my BMW lease that was to end in two months. Was better than buying out myself and dealing with that.

4

Great so in these two scenarios:

A. BMW pays $50,000 for car ($44,000 value (residual + payments left)) = Net +$6,000

vs.

B. Buy car $47,000 (tax included) and sell to third party $52,000 = Net +$5,000

Option A would be better.

5

Scenario A assumes the dealership will pay the documented residual value of the car. Unfortunately, the dealership has the option to pay BMW FS less than the residual.

I think you’ll find scenario B the better option.

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6

Yes. Option A is also faster / lower risk - you can sell the car and walk away immediately with guaranteed $$. On option B you need to tax & title car in your name with your local DMV after the lease payoff, and wait to get title issued before you can sell - could be immediate in some states but in others could be a month or two wait, and in that case you’re stuck if value drops during that time.

7

But in my scenario, I would still net better that route (A vs B).

Based on your explanation, BMW would be getting a discount on purchase, but that doesn’t affect my net, correct? (In my A vs B scenario)

8

Would be great to know if anyone has specific IL experience with this.

9

In order to avoid any confusion you need to stop using “BMW” interchangeably here.

There’s BMWFS and then there’s a BMW dealership. They are not the same.

1 Like
10

Understood, but I don’t believe I have referenced BMWFS at all with BMW.

11

KBB trade in does not really mean anything. You need to get actual quotes from the usual suspects to determine how much equity, if any, you actually have.

12

Yep, I have received some offers from Carvana, Carmax, and Vroom.

Carvana being highest at $51,900.

KBB Instant cash offer generated $51,500, but dealers will negotiate off that, so taking my car in for further appraisal. (Did notice that KBB trade in for instant cash offer showed a different result for my cars trade in value vs. when using their site to see trade in value: identical options selected too)

13

The BMW dealership does not have to pay BMWFS the documented residual on your lease contract.

14

The dealership I leased from has already mentioned offering a little over the buyout (they want to see it for exact number obviously).

So seems I should be in the green from all outlets (BMW dealers and 3rd party), however BMW dealers may be the least appealing if the profit delta is a significant difference. Will try other BMW dealers to see if I can narrow that otherwise I’ll just buy it and open up more selling options.

15

Does anyone have any DPs- If I payoff my BMWFS account and buy the car how quick can I sell to a non BMW party?

Thank you

16

If your dealer offers $ 3,101 less than carvana you break even and it is the best solution, and maybe the only one. To sell to carvana you would have to buy the car, pay sales tax , and that takes time.

Try to get an offer from dealer of $ 48k

17

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