One follow-up thought on point #2: Do you know whether prepaid maintenance can be done at any MB dealership (i.e., one in GA, which is where the car is currently located), or does it need to be done at the original MB dealership that leased me the car (in VA)? It’s unclear to me whether the prepaid maintenance is through MBFS or through the original dealer. I’m guessing the former – as the maintenance payment is baked in to the monthly lease payment amount.
Prepaid maintenance can be done at any dealer, just like any other service, repair, or warranty work.
Call the local dealer first, just to make sure it’s an MB plan and they can see your VIN has coverage in their system.
Probably not a huge difference but I’d try selling in Virginia
HI everyone. My lease is coming due April 13 on a 2019 BMW 530XI with MSRP $64545 and I’m wondering if I should buy out the lease. I leased it in 2020 as a loaner.
Residual value: $37810.25.
MIleage: 15800 miles (11000 in my 3 years)
Perfect condition.
Monthly payments: $432/mth though I put $3600 down in capitalized cost reduction and $3150 down in security deposits when I took out the lease.
Disposition fee: $350
State: Ohio
Dealer not interested in buying back for equity as they say it is trading around market value. I would consider buying and then getting something new in a few years if it would hold value. One concern is that even with low miles the car may require costly repairs in the coming years (maybe this is unfounded). The extended service plan I was quoted would be around $1600/yr for 2 years which seems like a lot. Appreciate any advice or thoughts if better deals on new BMW may come in the next few months.
If you decide to keep it, consider a third party warranty (this thread, start here)
You should definitely check other sources to see if there might be equity (probably not?)
Even at 0% interest, at 72 months, your payment goes up $100. If you like the car and are planning to write a check, maybe? Or if you aren’t at all payment conscious.
You didn’t mention state so not sure what the tax situation might be, but I’d work that out and look at financing/buyout numbers before making a decision.
Thanks for the suggestions and links. Forgot to add that state is Ohio. If I buy I’d probably write the check as financing options are not great at the moment though also have to deal with a 2nd lease coming due at the same time so not excited about the overall cost outlay.
Hi everyone. I have a 2019 Audi Q5 Premium Plus lease with $55k miles on it. Lease ends in February, the residual value on it is 24k. Would you keep the car or sell it? Trying to figure whether to purchase or lease another vehicle that isn’t as expensive. Any tips/advice is always greatly appreciated. I’m in California.
What are you paying right now? What are your current needs? Do you need another luxury SUV?
What were your allotted miles for the lease? Did you have to replace tires or brakes during the lease?
If I were in your shoes I would just return it. There are lots of cheaper options advertised by brokers in the Marketplace.
I am paying $599. I don’t need another lux suv. I was looking at the Kia Sorento. I just keep seeing that most leases are really bad right now. So leaning more towards purchasing this time. Open to any vehicles of the same size
There are some decent Nissan lease deals. Take a look at the Marketplace.
I have no clue what the numbers on a Sorento look like.
Hello 'Hackers - Hoping to gain your collective insight on my current situation and if a buyout makes sense. I tried laying out my current thinking below but am sure there are blind spots in my analysis that someone will identify.
My question is: If this was your situation, and you wanted a new car in the next two years, would you (i) buyout the lease now, (ii) wait until lease expiration then buyout, or (iii) forego selling the car entirely and see what you can find after turning it is upon lease expiration?
Note I am located in Maryland, but the lease started in Virginia. When I started the lease in Virginia, I paid sales tax on the entire vehicle price (as opposed to only the leased value), and after moving to Maryland, I again paid sales tax on the then-current vehicle value (Maryland DMV required this due to their higher sales tax relative to Virginia). As such, if I decide to buy-out the lease, I think sales tax will not apply.
Current Set-Up
- 2021 BMW X5M Competition
- MSD: $9,800
- Monthly Payment: $1,399.29
- Disposition Date: 12/12/23
- Payoff amount (through 2/9/23): $79,426.37
- Mileage/Allowance: 20,XXX/30,000
- Residual Value: $66,217.25
- Condition: Like New. Some minor scratches in the hood from rock chips, but none bigger than an inch. Some curb rash but I purchased wheel and tire protection for those to be fixed without cost. Also bought a new set of tires ready to be installed this Spring.
- Equity: This is where I need a crystal ball, given that I will not likely sell for another year or two, unclear if there will be equity.
Note for the below options I’m using this calculator and amortization schedule.
Option 1 (Buyout now; Sell in 1-2 years)
- Assumptions: No tax (already paid); APR (5.24%)*; Apply $9,800 MSD to down payment; 60-month term
*Per DCU’s current rates, perhaps there are better out there but perhaps not enough to materially alter analysis. - Monthly Payment: $1,321.60
- Total Interest Paid: $9,670
- Sell in 1 year (January 2024): Loan Balance $56,046
- Sell in 2 years (January 2025): Loan Balance $42,808
- Unknowns:
(1) How much would an extended warranty cost if I continue ownership past December 2024 (when factory warranty expires)? Likely at least $3k?
(2) Is it fair to assume I can sell my car for more than the loan balance in January 2024 or January 2025?
Option 2 (Wait Until Lease Expiration, Buyout Lease, Sell 1-2 Years Later)
- Assumptions: No tax (already paid); APR (6.5%)*; Apply $9,800 MSD to down payment; 60-month term
*Given the likelihood the Fed continues raising rates, adding 1 point and change to DCU’s current rates. - Monthly Payment: $1,103.86
- Total Interest Paid: $9,815
- Sell in 1 year (December 2024): Loan Balance $45,695
- Sell in 2 years (December 2025): Loan Balance $35,108
- Unknowns:
(1) How much would an extended warranty cost if I continue ownership past December 2024 (when factory warranty expires)? Likely at least $3k?
(2) Is it fair to assume I can sell my car for more than the loan balance in January 2024 or January 2025?
Option 3 (Forego Selling the Car Entirely; See What I Find in December 2023)
- Unknowns:
(1) Is there a car of similar caliber for approximately the same payment?
(2) Interest rates
Definitely not option 1.
2 Likes
You’re paid tax on it twice, and you want to buy it now and sell/trade it a year later?
Your lease isn’t up for 11 months, I’d sit tight for 6 months and reassess. I’m not hearing enough conviction to transact sooner.
I understood the tax paid “twice” to mean it summed up to Maryland’s 6% tax on selling price (which is quite punitive to leases). Since Virginia only collected and presumably remitted 4.25% so the balance was owed.
The big question is whether tax would be due again if the lessee bought out the lease.
That’s correct, thanks @max_g. I meant that I paid tax in Virginia when starting the lease and upon moving to Maryland and registering my car there I was required to pay their tax rate, but luckily I only had to pay the difference between Virginia’s and Maryland’s rate (if I waited more than 2 months they could’ve charged me the full 6%). If anyone knows whether taxes are due again upon lease buyout I would greatly appreciate it.
@max_g I’m curious why you’re against option 1. Care you elaborate?
Hopefully this is a related question.
I’m in the middle of securing financing to purchase my car, (Volvo XC60) at the end of it’s lease next month, (and NOT deal with any dealership), but I also want to purchase a 3rd party extended warranty.
I don’t suppose there is any way to do it without involving a dealership, but wrap the warranty into the loan is there?
why pay for something that is already flipped? you’re just going to drive it until it starts crapping out on you in the next year or so, then you’re going to try to get out of it, and you’re going to find that you’re $10k+ flipped.
I’m not sure I understand your reply, let me clarify:
- It’s a 2020 that I leased.
- I’m NOT turning it in, I’m going to buy it, and keep it for several years.
- I want some sort of extended warranty coverage for it.
your payoff is significantly more than the car is worth now. eventually, you will want to get rid of it. you will owe more than the car will be worth.