[oneofthesedays]

Here is the deal I'm being offered by my local dealership:

Car - Brand new 2009 335i Sedan
Premium Package
Sport Package
Navigation
Xenon Headlights
Sirius Radio
Premium Sound System
18 miles driven

$6200 down including taxes (includes all fees)
$437 mo. for 36 months (10k miles a year)

or

$3500 down including taxes (includes all fees)
$498 mo. for 36 months (10k miles a year)

Is this a good deal?

[JulieDriving]

I think, to have the best answer, what we need to know first is:

• What is the invoice of that car with all the options?
  
• What is the factory-to-dealer cash back on the 2009 335i sedan (they should be high).

Then you will know exactly how much over invoice you are paying (or under invoice, actually, with the factory-to-dealer cash back amounts).

[continentalg5]

Putting money down is probably one of the worst things you can do

If you're set on putting money down, put it in MSD's.

[tony20009]

Because the duration of your lease and the allowable mileage per year is fixed, the other thing you need to know is what residual value, if any, your car must have at the end of your lease for you to incur no additional charges.

If the obligation for the residual value is the same for both leases, then this is realy easy; you just need to compare the total cost (TC) to you in payments of each lease. The second option costs you about $400 less. Which is to say you are paying, over the course of 3 years, for something less than $21,400 of the car's total value.

Why less than $21,400? Because part of each payment you make is interest and the other part is the principal. And just like any compound interest loan, the portion of interest decreases with each payment. This is why any expectations/commitments you and/or the dealer have about the residual value of the car at teh end of the lease are important. If they tell you up front the price at which you can buy the car at the end of the lease, you can (indeed you have little choice) assume that's the residual value. If the expected residual value is the same under both leases is the same, take the second option.