Don’t think there’s any way to generalize which dealer will retail it and which won’t. Either way it will presumably end up on a retail lot somewhere.
But does that save you money?
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Hi y’all, looking for advice. I have a leased 2021 Audi Q3 45 S Line Premium Plus coming due in 3 months (36/10k lease). Current mileage driven is 20k, live in CA and the residual value for buyout is $26k. I like the car overall and would be happy to keep it for another year or two.
Buyout estimates from Carvana and Carmax are about 26k today but Audi financial says “ This payoff quote is valid for contracted parties only and is not a valid dealer payoff.”
Two questions:
- How should I think about “Is it worth it for me to buyout this car?”? If I’m understanding the numbers correctly, it seems like the residual matches Carvana / Carmax and therefore I wouldn’t make money buying the car but also am not underwater.
- If buying out the car, I have to pay taxes and fees on top of the residual, right? If so, is the sales tax on the residual value or some other number?
Always leased, never bought so would love some help and wise words.
Thanks!
Question if anyone has had this experience:
Asked for a quote from multiple dealerships on buying out our ‘21 540i xdrive msport with 30k miles in PA.
Per BMWFS, Residual + tax is $44,217.63.
Security deposit (not included in above) was $4,550. All dealerships quoted exact same buyout + doc fee.
However, one dealership quoted $36,307 out the door including tax, $5 county fee, and $77 registration (not including security deposit, I assume they would receive it from bmw directly). Price of vehicle prior to fees shown in formal quote was $34,157.99. We asked multiple times if this was correct as we will walk in with check prepared. They assured it was correct and all paperwork is ready.
Is this a case where the bmw would offer dealer buyout at a lower price and then resale to customer or is this simply a mistake they have not yet caught. If so, can we pay in full and once both sides sign contract it is set in stone and they cannot come back?
Sounds weird to me too.
Did you check your buyout online???
Try it you have nothing to lose.
If BMW Financial doesn’t agree you won’t get the title.
Definitely strange.
BMWFS online shows $44,217.63 including tax. $39,667.63 with security deposit.
Once all paperwork is signed and full amount check is handed over, can BMW or dealership come back?
There was a post here a year ago where the dealer ‘grounded it’ and then ‘bought it from BMWFS’ for a unspecified lower figure. And that was listed as a grounding and all fees went back to the original owner. (Causing him a lot of headache)
Appreciate that knowledge. So essentially they “return” the lease and then you buy it back as a CPO or pre owned vehicle with additional fees?
From the quote they provided they had not included any other fees so I’m wondering if it would make sense to go down this route.
Worst case, we can walk away prior to signing return of vehicle as well.
Historically so many leases have ended up underwater that banks would rather incentivize the grounding dealer to buy the car rather than ship every single return to an auction site.
So the dealer often has right to pay the lower of RV or wholesale value.
But BMWFS also has some penalty in place for any dealer who sells a return right back to the original lessee for below RV. IIRC.
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It definitely seems like a “too good to be true” scenario. Heading there shortly so let’s see the outcome. It’s surprising that the dealer is willing to take the penalty unless the wholesale value is substantial enough of a difference.
Update: they grounded it and essentially resold it as a used car. No additional fees other than price above. They keep the security deposit. I’m sure we will be charged disposition fee but dealership claims we will not.
Hi, I have a question about doing the math on an immediate lease buyout. I’m in CA and looking to get a BMW i4 or i5 when our kid turns 16 at the end of the year (we get the new EV; kid gets the current ICE). We’ve financed cars in the past and driven them for ages, so the huge initial depreciation was never a big concern.
The $7500 lease credit is so compelling but I want to do the math on financing through BMWFS vs. leasing and payoff the balance (forgo interest income) vs. lease and finance the payoff.
I may not be searching well but I’m having trouble finding loan rates to payoff a lease. Does anyone know what sort of #s I should expect for excellent credit?
Thanks!
Check penfed for the new auto & used auto loan rate. Check their requirement for new auto loan.
As of today (March 2024), it’s interesting math since BMW subsidizes the financing to make the leases more attractive. The money factor on the i4/i5’s have an effective APR around 5%, and the iX’s are around 2%. It’s extremely unlikely you’ll be able to borrow money from any bank or credit union cheaper than that. And even if you had cash in the bank to payoff the car, you’d probably be losing money by paying off the car too early!
Can I ask why not just keep the lease as long as you can? What’s your thinking around wanting to payoff so early?
There’s a thread in the Wiki
Problem is the continuing depreciation. And i4 35 leases are pretty good this month in the Marketplace
If anything the i4 to keep will be the NACS (supercharger compatible from the factory) version coming in 2025 or 26.
Hello, hopefully, someone can provide good feedback and help. I am leaning towards buying out the leased vehicle. It is 16000 purchase option, and seems like the card with the similar milage range anywhere 18000-20000. I have attached the lease agreement. Is it worth it?
Thank you.
326756LEASE.pdf (1.1 MB)
That’s a personal decision you need to make for yourself. Do you like the car? Does it give you any problem during your lease time? What kind of car is it? If your decision is only based because the purchase option is cheaper than the market value, you can always sell the car to carvana, carmax, or autonation, get the equity and buy/lease another car.
Thanks! It looks like New Auto Refinance would cover it…rates a tad over 6% currently.
As one poster pointed above, i4/i5 has an effective 5% APR for lease, unless lease is taxed differently, you may better off buying it out at the end vs buy out asap.
We tend to hold onto cars 10+ years, so given I was planning to keep the car after the lease term this would be a chance to lock in the finance rate.
At least that’s how I was picturing things.
(As our first EV I have no clue how financially smart it’ll be keeping the car for 15+ years like our current Toyota.)
Probably a no-brainer but here goes.
2021 Kia K5 - 12,500 miles
Payoff is 17500
$300 buyout option fee.
Should be $19,200 post tax directly from Kia.
Financing rates are crap right now which is depressing. Police and fire union rates are about 6.5% for 60months.
Would I be stupid to not buy it out? I dont love it, and I’m already liking the idea of applying the positive equity toward something else but the frugal part of me is thinking I’d be stupid to not buy this car.