What is the difference between the current trade-in value of the car and your payoff? This may be a more cost-effective way of dealing with the situation. Then you will just see the exact amount of your negative “trade-in” at the time when you will go to lease the new car. But negotiate the new lease without mentioning of your current vehicle to be traded in (i.e. sold to the dealer)
There are only a few ways to have so much negative equity in a short period:
a) You paid MSRP, extravagant fees and bought additional after market warranties etc
b) Your interest rate is awful
c) You rolled in negative equity from the previous trade/deal
d) You took a 72 or 84 month term, thereby making little in terms of principal payments in first few years
Negative equity is always highest the first few years, when you pay most of the interest and less of the capital. Eventually, negative equity evens out as even BMWs tend to keep their year 5 to 8 value quite well. eg 2017 BMW X5 = 60 k, 2015 BMW X5 = 40k, 2010 BMW X5 = 20k. So you can see it depreciated 33% off MSRP in 2 years but only a further 30% off MSRP after next 5 years.
In any case, the problem here is not the car but the approach to trying to keep going on the negative equity “rolling over”. Guess what happens 1 year after you have rolled in 11k negative equity in the deal? Well you have the original 11k negative and then some …
It’s still a BMW. I had a 7 series that was fine for years, then warranty was up and the turbos were leaking and traded in for this car. Got swindled into financing it with balloon payment instead of leasing it. Also had a X5M and it had electrical issues. Never having one out of warranty ever again.
As for the equity, whether I trade in now or in a year, it’ll still be the same $10K-$12K equity, and with these coming off leases, the market is about to be flooded, and with that the values. So that’s why I’d rather do it now. Had a 4 series and the value dropped $5K in 4 months because the auctions became so saturated with them.
So the idea is to get something for 2-3 years that I’ll be content with (QX60/Explorer Sport), hopefully save $50 a month so that at the end of the lease, I can start fresh and not make the same mistake of financing a BMW.
Financing a BMW wasn’t the problem. It sounds like you didn’t think through keeping this car and never had the intention to. Financing would have actually been smarter in this case so you could just own it. You are throwing out $10-12k plus whatever you have paid on the car. By this point you could have bought a BMW CPO or any other car.
You have spent nearly $30k in less than 3 years and have nothing to show for it.
It’s not a BMW, but you can get this one for very little down and with very low payments. Just think what the neighbors will think when you drive up in style ! The towing company said it’s all set up for your pull-ahead !