Question about Leasing Loaners or Executive Demos

Ask the Hackrs
1

Hi Everyone,

I just have a question about leasing these exec demos or loaners that have some mileage and how I should be factoring this in?

For example, I have a BMW car with the following:

MSRP - 50k
Net Cap - 41k
Mileage - 8k
Residual - 58%
Money Factor - .00134
Lease Term - 36 months

After all my calculation, it comes to about $480 a month, but what do I do with the mileage?? I heard you multiply it by the miles * .2 - but what do you do with that number after? For example, if I started out at 8k and I’m leasing for 15k a year, by the end of my lease I should be returning it at 53k correct? I still don’t understand what I should be "adjusting’ the mileage for.

Thanks in advance everyone.

2

It is 0.30 or 0.25 with BMW.
Take $ amount and then work out the actual $ residual amount, 58% of 50k in your case. The. Subtract your millage amount from the residual amount.

Then work out the new residual % and plug that into your figures.

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3

For BMW I believe the residual reduction is calculated as

Mileage - 500 then x $0.25

So 8,000-500 =7,500
7,500 x .25 = $1,875 reduction in residual value

4

@NYL12, That’s correct. But the LeaseHackr calculator doesn’t allow for entering a dollar residual, only a percentage one. So to figure out the impact of the mileage on the residual you need to divide the mileage cost by the MSRP to get a percentage to deduct for the financing company’s residual percentage.

In this case, 1,875 / 50,000 = 3.75% which you would then deduct from 58% residual to get a adjusted residual of 54.25%

Said differently, you’re paying an additional $1,875 over the course of the lease in depreciation costs.

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5

Thanks everyone for your answers. This helps me tremendously.

6

I built on a excel spreadsheet I got that calculates the change in residual, but don’t know how to attach as a file. Looks like you can only link to a web site.

You just input the mileage and it reduces the residual in the formula. But your way works for the leasehacker calculation. Just an added step.

7

You can use this sheet:

https://docs.google.com/spreadsheets/d/17OZV-AKlzCitpVVxpyDCvxyNS8-KDU-RG6Y_J-5Jz3k/edit?usp=sharing

Just make a copy for yourself. Adjust the cells accordingly if the formula isn’t

(Miles on odo - 500) * $0.25

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8

I am looking for a bmw demo car but qhen I searched any bmw website, they do not indicate demo cars. I can only see pre-owned or certified. If one of them refers demo cars, what is the difference between them.

Can I still have same warranty as a new car? Please explain me what is difference between demo and new for lease. Thank you.

9

I have 200 to choose from.

They are new cars with miles on them.

Driven either as a loaner car or a company executive.

They get all new car programs and warranty.

This applies to BMW and MINI.

10

got a list of prices / models?

11

Would love to see the list myself also!

12

His list will have one car less… Picked up mine a few hours ago… About to open a new thread detailing all the numbers. Great deal, thanks to Loberant and all I learned in this forum!