Hi everyone – hoping to get thoughts on a strategy I’m currently considering. Thanks to this forum, I was able to obtain a lease for a 2020 BMW X3 M40i 3 years ago with a payment of $520 incl tax. It was an incredible deal and a fun ride. Now as I enter into my last month of the lease, I’m trying to decide my next move. Based on the lease payout, I should have ~$13K in lease equity (in reality ~$7k after taxes on the buyout). My greatest concern is the likelihood that this vehicle’s value drops to a more realistic residual as we go further into the complexities of today’s market / financing.
The vehicle I’ve been most eager to switch to is the Bronco Raptor, but as everyone knows, this has been an impossible feat. The closest I’ve gotten is to placing an order last week and then being told it’ll have a $20K ADM. With that said, I’m currently looking to buyout the BMW lease and then capitalize quickly on a trade-in option that would hold value better until I have the opportunity to switch to the Bronco Raptor without the crazy ADMs. Would be curious to hear any thoughts on this. I looked this weekend at an F150 Tremor 402A, fully optioned, with A Plan that’ll keep me ~10K below sticker at the time of that purchase. My hope is this would better hold its value, especially starting off below sticker, until I can get a Bronco Raptor order placed without markup.
You should start by getting actual offers for your X3 from a BMW store for now, as it’s not super likely there’s anywhere near that much equity in that car.
Thanks for your input. Maybe I am calculating the equity incorrectly? Payoff around ~$33K before taxes, which becomes 38K. I have a trade in offer of $45K and a KBB trade in value of $43-47K.
CarbuyerUSA was actually my highest offer among the other online buyers. Carmax has drastically declined. Tried selling through KBB instant offer and spent 2 hours at a dealer having them put the car on a lift only to knock off 30% off the guaranteed initial offer.
Thank you all for your input. Much appreciated! One more question – in order to buy out my lease, I will need to finance the payoff. However, I am going to then be taking that bought out car and trading it into a Ford dealer (can’t give them my lease to buyout since they aren’t Autonation) for a new car, which I will also have to finance. Any advice for a mechanism to finance the buyout, which I’ll then just be trading in and paying off to get the longer term finance?
Thanks – I’ve read that thread and looked through the CU options. My question though is more pertaining to the process of financing a lease buyout, then trading in the bought out vehicle and financing yet another new vehicle that I’m trading in for. Just not sure if there is a more logical way to do this than to apply for financing at the lease payout amount, paying that off when trading in, and then somehow getting a simultaneous financing approval in order to take care of the loan amount for the remainder of the car I’m trading in for. Feels like I’m missing a more obvious way to do that.
Trading in a car that has a loan for another car that will be financed is among the most common use case out there for a dealer transaction.
The main way to make this simpler for you is paying cash for the lease buyout so you don’t have to do go through the effort and inconvenience of doing a car loan on your own. But that’s not an enormous amount of work.