[PrestigeNightLife]

Here is the deal, I just became a member because I've heard people on this forums get a lot of good deals. I'll provide as much details as I can:

Back in April I was bored so I decided to see if I get approved from a BMW Lease. I went in with doubts about getting approve since my score is only 675. In addition to that, I've never had a car lease in my name before and my current car is a 1996 Honda Accord. I'm young, 23 years old, but my income is 80K/yr. I expressed all these concerns to my dealer (Mistake #1), so he made me do all the paper work and told me that I could get approved. As it turns out, I got APPROVED! He asked me to come in as soon as possible to put a $2,000 non refundable deposit down and $3000 more due at sign in. Me being excited as I was for getting approved, went to the dealer as fast as I could and signed in the pre-order papers. The MSRP of the car was 50,252 (Sports, Premiun, Navigation, Rear Sunshade, park distance, etc). I tried to ask for a discount on the MSRP but he fed me the B/S that the cars on high demand and in most places, people are paying above MSRP (Mistake #2). He is charging an additional $350 on fees and others.

He quoted me at $741/Monthly (tax included) with the the $5,000 down, 15K Miles, 58% Residual, MF (he did not discussed). At the time I did not even know what the MF was (MISTAKE #3). So I walked out of the dealer having order the car, and $2,000 comitted since it was non refundable.

Now, the car is almost here (Currently on WATER), and thanks to all you guys I have educated myself in everything there is to know about leasing. In doing so, I've realized that $740/month is extremely high considering the amount i'm putting down. Can any of you guys advise on what I should be paying considering my credit score and all? Also, once the car arrive and is time for me to sign the lease, can I still renogotiate the previously quoted rates???

[PrestigeNightLife]

Based on information that I've found online. Here is what I should a comparison of what I should be paying and an estimated assumption of what my Reeves dealership is charging me. Let me know, what you guys think? if i shold be paying lower than the $686 I came up with?

[PrestigeNightLife]

Here is the e-mail I sent the dealer with the above attachedment:

Sent: Tuesday, June 19, 2007 3:08 PM
To: DEALER
Subject: RE: BMW 335I Coupe - Status


Roger,

How are you? Hope everything is well. Thanks for providing me with the below update, do you know the name of the vessel that the car is on?

Also, I've been reading a lot of forums online about leasing. I made a good choice by leasing and I also think I made a good choice by going to Reeves since you have been very helpful throughout the process. However, I'm a little bit concern about the numbers as I've read from other people that they have gotten much lower payments then I have by putting anywhere from $0 - $2500 down (due at signing).

I've created a MS Excel spread sheet using formulas I've found in Emunds.com and information found on other website (e.g. Bimmerfest.com & e90post.com). I've highlighted areas in green, which are areas that are flexible to changes such as M.S.R.P discount, dealer fees, Down Payments, etc.). In creating so, I've found a few issues with some of the leasing term that hopefully we can correct once the car arrives at your BMW Center. The issues are as follows:

1. Money Factor Rates & Markups

The column highlighted in green letters (column C) is the calculation using the Base Residual Value and Money Factor used by BMW Financials according to above sources, which is:

36 Month – Residual 58% of MSRP – .00185 Base Rate

In the spreadsheet, row 22, you will noticed that I've added a mark up of .0004 percent, which is the maximun amount the maximum mark up (dealer's profit) price for a dealer.

The column highlighted in blue letters is adjusted to estimate more or less the price that you quoted me at, which is calculated at

36 Month – Residual 58% of MSRP – .00213 Actual Rate

If we were to use the base rate, and split the Mark Up (dealer's profit) in half (.0002), my payments should be about $702 monthly. Please note, I'm assuming that all fees, & first payments are for a total of $1,685.

2. MSRP Discount

I understand that there is a high demand for this vehicle, I've read lots about this, but even so I've read people receiving anywhere from $500-$1500 off the MSRP. The 2007 models are already half a year old and the 2008 will most likely go into production in early September. I'm not receiving any reductions on MSRP, and I don't expect much of a reduction on it because I undersdand the concept of supply and demand very well. However, I believe demand will start decreasing slightly as the release of the 2008 Infinity G35 Coupe is only a month away and many BMW dealers will start taking orders on the 2008 models. I'm hopeful that this is an area we can make some improvements.

3. Changing Mileage Used Per Year

I think that I will only use about 12K miles per year based on my current driving routes, if not less. In changing the miles to 12K instead of 15k, this should increase the residual percentage to 60%, which equal savings of about $27 on monthly payments.

As you know, this is my first car that I'm going to lease and I'm sure they will be many more. I work very hard for my earnings and I will not like to think down the road that I made a mistake on my lease. I'm sure and trusting that you will continue to be helpful and will walk me through these numbers to provide me with the best rates/quote possible. I apologized for the long e-mail, but I wanted to make it clear in explaining my numbers.

Hope to hear from you soon. You may call me if you wish.

---------------------------------------------------

Here is what he replied:
From: DEALER
Sent: Tuesday, June 19, 2007 3:22 PM
Subject: RE: BMW 335I Coupe - Status


Hi Danny,

We will work all this out when it gets here. You have some valid points and some might be misunderstood. We value your business and we have been #1 for over 35 years so you can trust us. I will show you everything on Reynolds and Reynolds which is how ALL leases are calculated by every dealer.

BMW will raise the lease on the 2008 and there are no changes. They know the market and demand now is HIGHER then before!

I will take care of you so relax!

See you soon,

[NPDAN]

I dont think you'll be able to negotiate the lease terms when the car arrives. When you and the dealer were making the deal, im pretty sure he was going off of the current lease rates when quoting, than when you agreed to take the car, he probably locked you in to the rate at that time.... Not positive though.

[tcpsoft]

Sounds a little high to me and given the circumstances, you may want to shop around. I'd try a local bank or particularly a credit union if you're a member and compare. If you got approved already, it's a reasonable chance you'll get approved somewhere else. I got a much better quote from my credit union (Navy Federal) when I was considering a lease than the manufacturers financial service. You'll usually get a better rate and higher mileage allowance NOT at the dealer. Don't forget, even with a lease you can still negotiate the price.

Final note, always walk away from the first offer.

Good luck.

[tambo916]

your document is great, but might be overkill. here is a quick and easy way to calculate the lease payment when you are at the dealership and you are trying to find out if you are getting hosed.

(Cap Cost – Residual Value) / Term = Depreciation
(Cap Cost + Residual Value) X Money Factor = Interest
Depreciation + Interest = Base Monthly Payment

Based on the numbers you provided you are getting ripped off. Do the math you are actually paying well over MSRP for the car.

My calc.
MSRP: $50,252
Residual: 58% or $29,146.16
MF: 0.00185
with no money down assuming MSRP I get a monthly payment of $733.16 (not including tax)

Depreciation: $586.27
Interest: $146.89

If you are putting $5k down and pay MSRP your payment should be much lower. How about $585 not includuing tax.

Let me know if you need more help. I love working lease deals. Check http://forums.roadfly.com/forums/fin...8458168-1.html for most up to date lease terms on BMW. Great website.

[bimmer newbie]

You should find out about the laws in FL about putting down a deposit for a merchandise that you don't yet have and that you haven't signed a contract for. As I understand it, in CA the deposit is refundable since I don't have the product yet and I haven't signed any contract.

What is the MF they're offering? Is it .00213?

[Coldintake]

.00185 is the buy rate for a 335 coupe.

[LI E90]

Infiniti is spelled with an i and it is the G37 coupe..............

[PrestigeNightLife]

Originally Posted by tambo916

If you are putting $5k down and pay MSRP your payment should be much lower. How about $585 not includuing tax.

Let me know if you need more help. I love working lease deals. Check http://forums.roadfly.com/forums/fin...8458168-1.html for most up to date lease terms on BMW. Great website.

Thanks for the information, this is very helpful. However, won't some of the $5,000 down go towards the first month payment, sec deposit, other fees. So i'm actually putting about $3200 down. Either or, you are right, I should be paying in the low 6 hundred with tax included. I just got real excited with the dealer because I got approved when I thought I was not going to get approved and did not know anything about negotiating MSRP or themoney factor.

[PrestigeNightLife]

Originally Posted by LI E90

Infiniti is spelled with an i and it is the G37 coupe..............

Thanks AH*LE ! JK...Yeah you are right, I was in a bit of a rush writing the email, it is Infiniti and the G37 because is now a 3.7 liter instead of the 3.5.

[PrestigeNightLife]

Originally Posted by NPDAN

I dont think you'll be able to negotiate the lease terms when the car arrives. When you and the dealer were making the deal, im pretty sure he was going off of the current lease rates when quoting, than when you agreed to take the car, he probably locked you in to the rate at that time.... Not positive though.

The current lease rates have not changed. According to the CA and what he said on his e-mail, that he will take care of me. But he's too effing good, so he will try to talk his way out of it. I know he's going to feed me the B/S, "Well, you know it is your first car, and based on your credit this is the best we can come up with..."

[krash]

The monthly payment is high. The down payment is high. Period.

1) If you didn't sign anything, I am not sure you are legally obligated. 2) I am not sure the 2k down that you put down is non-refundable. How could that be? I never heard of dealers taking non-refundable down payments.

Did you sign anything?

[PrestigeNightLife]

Originally Posted by bimmer newbie

You should find out about the laws in FL about putting down a deposit for a merchandise that you don't yet have and that you haven't signed a contract for. As I understand it, in CA the deposit is refundable since I don't have the product yet and I haven't signed any contract.

What is the MF they're offering? Is it .00213?

THe deposit was refundable before the car was produced, since is already produced is no longer responsible. Is a special order and modified to my likings so now I'm F*&ked pretty much and i'm at the mercy of the dealer. I can walk away from the $2,000 and just get something else all together but then I'll have wait another two month. It seems to me that with this lease, over paying for this car a total of about $6,000.

[PrestigeNightLife]

Originally Posted by krash

The monthly payment is high. The down payment is high. Period.

1) If you didn't sign anything, I am not sure you are legally obligated. 2) I am not sure the 2k down that you put down is non-refundable. How could that be? I never heard of dealers taking non-refundable down payments.

Did you sign anything?

Yes, I did. I signed some "Mini" quote paper where that detailed the order. and in the "Other Description" he put the lease terms for when the car arrives, "$741 inclusive of tax, 2,000 down payment n/r deposit and 3000 due at signing." He said that the reason I had to put $5,000 down is because of my credit and i was a first time buyer.

[krash]

Originally Posted by PrestigeNightLife

Yes, I did. I signed some "Mini" quote paper where that detailed the order. and in the "Other Description" he put the lease terms for when the car arrives, "$741 inclusive of tax, 2,000 down payment n/r deposit and 3000 due at signing." He said that the reason I had to put $5,000 down is because of my credit and i was a first time buyer.

Well, like you said, the $5000 isn't just cap reduction. It probably includes a security deposit and other fees. But even so, that monthly payment is very high. More than $150 high...

I am still not convinced you are legally obligated.

I ordered as well. Taking delivery next week. I initialed the order, but I am not legally obligated to consumate the deal. I could also get my money back. I put 1k down to move forward with the order. This will be applied to the total upfront costs I owe.

[HPIA4v2]

I believe in most states car deposit is refundable.
You can always file a small claim in court if dealer decides to keep your deposit. You have nothing to loose at that point, do you?

I've seen a friend of mind backing out on a deal buying a house and the seller returned his earnest money, not very willingly but nonetheless my friend gets it back.

In my opinion, your dealer will reason with you.
They are here to sell cars not ripping people off, as long the profit margin is there of course.

Good luck.

[krash]

Originally Posted by HPIA4v2

I believe in most states car deposit is refundable.
You can always file a small claim in court if dealer decides to keep your deposit. You have nothing to loose at that point, do you?

I've seen a friend of mind backing out on a deal buying a house and the seller returned his earnest money, not very willingly but nonetheless my friend gets it back.

In my opinion, your dealer will reason with you.
They are here to sell cars not ripping people off, as long the profit margin is there of course.

Good luck.

+1

You should tell the dealer that you want out of the deal and want your money back.

I'd then shop elsewhere and wouldn't even consider negotiating any further with this guy.

[NPDAN]

Also, keep in mind... It's great to shop loans and find your best deal, just be aware that every time they run your credit it goes on your record and it could actually go against you. Too many inquiries will lower your credit score.

[flush01]

he's telling you to relax because once you come to pick your car up and you see it, they will take adventage of you being excited and will screw you over anyways....

[Prodigy]

You really need to check with your state laws. Your downpayment should be refundable. If you're not going to get what you want take your business elsewhere.

[PshhhhhMW]

once your car arrives and you're ready to close the deal, do the numbers with them to show the discrepancy. your lease isn't final until you sign the actual paperwork. in fact, bmw currently has a lease offer for the 335i. i believe it's $3500 due at lease signing $509/mo. this is based on $42,850. you can use that as a starting point. since you're pre-approved, you qualify for that offer.

also, make sure you bring friends with you. dealers use intimidation tactics when you go alone to force you to close the deal by double, sometimes triple teaming you (Finance Manager + Sales Dude + General Manager vs You by yourself). next time, get your pre-approval directly from the car company's leasing company. it's so much easier to lease or buy a car when you go into a dealership already pre-approved. i did this for my mom when she needed to buy a new honda. even with her pre-approval, scumbag tried to talk to her privately and have her do a 60 month lease. when she told me, i told him to go f himself in front of the finance manager. the finance manager laughed at the sales guy, apologized, and gave us an even better deal than the lease promo they had.