First, thank you for all for spending time answering questions here. I have never posted, but have read a ton over the past few months. I have a lease quote in-hand, and despite my newly acquired lease knowledge, I am not sure I’m evaluating it correctly (or, maybe I am, and BMW is trying to pull one over on me. …)
Email from Dealer states: The lease is structured as a 36 month lease, 10,000 miles per year $4,400 due at delivery ($3,850 MSD’s and your first month payment, everything else is in your payment). Monthly lease payment is $550.
I added the numbers as I knew them into the LHcalculator and replied with this: Thank you. Without knowing the money factor you used it’s impossible for me to run the numbers on my end. I tried my best to replicate your offer by pulling the numbers you gave me into a calculator (shared with here) and I’m getting a $505/mo payment (taxes and stuff rolled in, includes the 7 MSDs etc). I must have something different than you did. I’m guessing it has to be the money factor or the residual? Can you please send me the full breakdown like this calculator has?
Her reply to me this morning: You may not have factored in taxes on rebates, tax on bank acquisition fee, the dealer conveyance fee, etc. basically there is tax on everything. Everything has been rolled into your monthly payment with the exception of the MSD’s and your first month lease payment which is due at delivery. She sent this breakdown:
I see her MF is different. Is it really just the taxes? I plan to still ask for more off MSRP based on other loaners we were discussing that have since sold.
Appreciate help understanding what’s off and if I’m reading this correctly. Also relevant, dealer is in Southern CT and I live in Westchester Co NY.
The MF of .00130 is after the MSD - but that would mean the rate they’re using pre-MSD is .00165, which is slightly marked up from buy rate of .00145.
The bigger issue that I see is that you’re leasing an X3 Demo with 4359 miles on it which is dropping the residual. You’re only getting a 14.8% discount for a demo, which combined with the marked up rate, is making this a less than impressive deal. I’d say you should push for another 1-2% off of the sale price and buy rate.
Everything else does appear to be taxes. I don’t see anything else of concern besides a high doc fee.
They marked up the MF. Base rate is .00145, tell her you want the base rate. After that, you have a pretty fair deal, with maybe slightly more room for discount, but again, very fair once you’re at buyrate.
I definitely get the pride of hacking your own deal, but there are a bunch of brokers in the Northeast that you should be taking a look at.
If nothing else, they will provide you with a good benchmark of what’s possible, and if you can’t make something similar happen, then you could just have them set up your lease. Many of these deals have Loyalty baked in, so you’ll need to back that out if it isn’t applicable.
Actually, this is not true. Most states do not tax on doc. fees, and even though you’re buying the car in CT, you’re exempt from paying CT sales taxes, because the car is registered in NY.
In NY, the following charges, fees, and incentives are generally not subject to sales tax:
vehicle registration and title fees if the amount charged by the dealer is the exact amount charged by DMV and the charge is not included in the monthly payment (see Vehicle registration and title fees, on page 8);
certain documentation fees;
any security deposit that is refunded to the lessee at the end of the lease term;
the charge for “gap insurance” if the charge is reasonable, separately stated, and not included in the monthly payment; and
any rebates, discounts, or similar incentives provided by the vendor (usually the dealer/lessor) and not reimbursed by the manufacturer or any other third party.
Update: She came down on the price, some, but affirmed the MF “0.00130”. I’m waiting before replying later today, but I plan to reply:
That I understand the MF, but that rate is ONLY b/c of the MSDs. If you back out the MSDs the MF they’re charging me is actually .00165. I’m asking her instead of coming down any more on MSRP (which seems unlikely, I’m already at 15% off) that she reduce the MF to the base/buy rate (BEFORE MSDs).
I’m still unsure if I’ll pay MSDs, I see conflicting info / risk so I need to do more research. This is how I have my ask structured – though my #s never seem to match hers completely (she says b/c of tax…)
I have it as the price/rate I’m asking, still including 7 MSDs (undecided) and everything else rolled into monthly.
That seems high. Here in suburbs of Chicago a 51k X3 is 589 a month with 7 percent sales tax with first payment. That’s without any negotiations on a brand new vehicle. That’s not including any loyalty.
For a new car you can get 10 to 12 percent off if you push it. For a loaner with that many miles they are barely discounting it.
Using your calculator, the MSDs bring the price down from $522 to $494, a difference of $28/month. Given 36 months, that’s $1,008, guaranteed savings with $3,500 in MSDs. If you invested that $3,500 for 3 years, you would need to be earning 8.8% each year (compound interest). If your finances can live with locking up $3,500, it’s a good bet.
Some here act like they have many investment opportunities that pay more than the 8.8% in your example, but this is guaranteed…no risk.
If I was leasing something where MSD’s were an option, I would think of them as a no risk bond type of investment…diversifying my portfolio.
I don’t qualify for loyalty, unfortunately! They’re discounting it nearly 15% on a 52.5K MSRP – feels to me that they’re discounting it more than they would a new car? I have no doubt I could get her down another 500-1000 in MSRP. However, they are also inflating the MF. If they reduce the MF and I get the savings afforded by max MSPs that’s ~$2K or so over the lease, IIRC. Roughly. I was thinking I’d go after that and leave the MSRP alone as a bargaining chip. We’ll see. I may just end up choosing a less expensive version (this one is on the lot and has the options I want plus leather, but I could compromise )
It’s not an apples to apples comparison in terms of % off MSRP for new vs demos because the demo mileage above 500 reduces the residual. For example, with the same MSRP and MF on a new X3, you would only need a dealer discount of 12.75% to get to the same monthly payment of $494 after tax because the residual isn’t decreased. Take a look at the calculator link below compared to the one you posted. Bottom line, you need more discount, base MF, and MSD to make this better.
I give up if you’re not even considering (as in you seem to just be shrugging your shoulders) that they’re hosing you on tax and I’ve replied many times on how to fix this amount that is being capped…
Not sure where I shrugged on that? You’re entirely right, and in my drafted-but-not-yet-sent reply, I have requested a full breakdown on all charges – including tax.
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