[shipill]

Anyone ever lease a bmw or any car this way? I did some reading about it, but what is your personal experience leasing this way?

[2kaccordocoupe]

For those that don't know what this is...
http://www.leaseguide.com/sn/prepaid-lease.htm

[goldn]

i didnt know that was an option.
anyone have experience?

[dibbz]

I checked it out when I was ordering my car. I figured if I could put that much money down in one shot isn't it better to finance? Of course this is assuming you aren't leasing for business reasons.

[ians]

finance, you can't walk away after the lease end if you get a lemon. It is important for European made.

[Astroboy]

I'd never do it for the same reason I'd never give a downpayment. If your car is written off (stolen and not recovered or damage from accident) your insurance company pays the leasing company. They do not pay you. So if you give a 10k down payment on a 3 year lease and one month later your car is stolen and not recovered, you basically paid 10k to drive a car for a month.

Interest rates would have to be really high for me to consider this. And with every leasing method, you always pay interest on the residual value, so the interest savings is only on the value of the car you are consuming.

[marakbai]

Originally Posted by Astroboy

I'd never do it for the same reason I'd never give a downpayment. If your car is written off (stolen and not recovered or damage from accident) your insurance company pays the leasing company. They do not pay you. So if you give a 10k down payment on a 3 year lease and one month later your car is stolen and not recovered, you basically paid 10k to drive a car for a month.

Interest rates would have to be really high for me to consider this. And with every leasing method, you always pay interest on the residual value, so the interest savings is only on the value of the car you are consuming.

+1

[benyl]

Originally Posted by Astroboy

I'd never do it for the same reason I'd never give a downpayment. If your car is written off (stolen and not recovered or damage from accident) your insurance company pays the leasing company. They do not pay you. So if you give a 10k down payment on a 3 year lease and one month later your car is stolen and not recovered, you basically paid 10k to drive a car for a month.

Interest rates would have to be really high for me to consider this. And with every leasing method, you always pay interest on the residual value, so the interest savings is only on the value of the car you are consuming.

There is something called gap insurance. Look it up.

Everyone who leases should get it.

If you total your car 1 month before the 3 year lease it up, you get the full amount back. Basically, you drove the car for free for 35 months. So if you total the car after 1 month, you get all your money back.

[PaulBailey@ltbmw]

Originally Posted by 2kaccordocoupe

For those that don't know what this is...
http://www.leaseguide.com/sn/prepaid-lease.htm

Good info.

[aspiring335]

No, that is not how gap insurance works at all -- you should look it up yourself! All BMW leases include gap insurance, and it covers the shortfall between the value of the car as assessed by the insurance company in the event of a total loss and the payout amount of the lease.

It's really not helpful to spread such misleading information. No insurance company would retroactively make your lease payments - you've already had use of the car for that period, so what would they be insuring?

Originally Posted by benyl

There is something called gap insurance. Look it up.

Everyone who leases should get it.

If you total your car 1 month before the 3 year lease it up, you get the full amount back. Basically, you drove the car for free for 35 months. So if you total the car after 1 month, you get all your money back.

[benyl]

Originally Posted by aspiring335

No, that is not how gap insurance works at all -- you should look it up yourself! All BMW leases include gap insurance, and it covers the shortfall between the value of the car as assessed by the insurance company in the event of a total loss and the payout amount of the lease.

It's really not helpful to spread such misleading information. No insurance company would retroactively make your lease payments - you've already had use of the car for that period, so what would they be insuring?

My Bad. It is called a waiver of depreciation.

My Insurance asked if I wanted WOD on my C63. They said that if it is totaled in the first 3 years, I get the full amount that I paid.

It cost 5% of your premium. Well that is what it cost me.

[aspiring335]

Originally Posted by benyl

My Bad. It is called a waiver of depreciation.

My Insurance asked if I wanted WOD on my C63. They said that if it is totaled in the first 3 years, I get the full amount that I paid.

It cost 5% of your premium. Well that is what it cost me.

No, you do not get anything back for any lease payments!!! Your insurance company has misinformed you or you have misunderstood them. A waiver of depreciation simply ensures you are covered in the event of a shortfall between the value of the car and the amount owing.

[Bimmerista]

Originally Posted by Astroboy

I'd never do it for the same reason I'd never give a downpayment. If your car is written off (stolen and not recovered or damage from accident) your insurance company pays the leasing company. They do not pay you. So if you give a 10k down payment on a 3 year lease and one month later your car is stolen and not recovered, you basically paid 10k to drive a car for a month.

Interest rates would have to be really high for me to consider this. And with every leasing method, you always pay interest on the residual value, so the interest savings is only on the value of the car you are consuming.

Since the leasing company has already received full payment from you, why would the insurance pay the leasing company twice ?

Presumably the insurance company will pay you the balance of the lease term (you would "loose" the amount attributed to what you already used up to that time). I say presumably bcs in fact I fact no experience with this kind of leasing, since it is not permitted in Québec.

[dibbz]

Originally Posted by benyl

My Bad. It is called a waiver of depreciation.

My Insurance asked if I wanted WOD on my C63. They said that if it is totaled in the first 3 years, I get the full amount that I paid.

It cost 5% of your premium. Well that is what it cost me.

There is such a thing. However, as Aspiring has said I don't think it applies to leases. If you look at your insurance cards for your leased vehicle you will see what it is not your name as the owner, but the leasing company (BMW in this case). I would talk to your insurance company about payouts on a total loss lease vehicle. I don't think they will pay out their asessed value plus what you have paid so far on the lease. You will probably be out that money in that case.

BUT there is an option out there that will payout the full value of your car when you bought it (or finance). I'm with TD Monnex and I forgot what the option is called but it allows you to recieve the full value of your car when it was new in case it is a total loss within the first 5 years of ownership. It costs quite a bit and the cost increases every year, but I am considering getting it.

[Astroboy]

Originally Posted by aspiring335

No, that is not how gap insurance works at all -- you should look it up yourself! All BMW leases include gap insurance, and it covers the shortfall between the value of the car as assessed by the insurance company in the event of a total loss and the payout amount of the lease.

It's really not helpful to spread such misleading information. No insurance company would retroactively make your lease payments - you've already had use of the car for that period, so what would they be insuring?

+1 to everything aspiring335 has said. As aspiring335 said, gap insurance is included in all BMW Canada leases. Therefore it is not required for you to purchase the waiver of depreciation from your insurance company if you are leasing. Also, if the waiver of depreciation is offered by a variable number of years depending on the insurance company, so assuming a 3 year lease, without gap insurance, the waiver of depreciation would not provide the coverage you need for your lease term unless it was offered for at least 3 years (e.g. some insurance companies in Ontario only offer it for 2 years).

However, if your financed or purchased your car in cash, then I would ensure you have the the waiver of depreciation as it is only a few dollars a month and it not only covers your purchase price but also any sales taxes that were paid (speaking for Ontario only here - don't know about other provinces).

[Astroboy]

Originally Posted by Bimmerista

Since the leasing company has already received full payment from you, why would the insurance pay the leasing company twice ?

Presumably the insurance company will pay you the balance of the lease term (you would "loose" the amount attributed to what you already used up to that time). I say presumably bcs in fact I fact no experience with this kind of leasing, since it is not permitted in Québec.

If your leased car is written off (regardless of leasing payment structure) there is a possible balance owing on the lease (this would be 0 if you did single payment lease) as well as the residual value that would never be 0.

Simply put, when you lease, regardless of the payment terms, if your car is written off the insurance company does not pay you one cent for the car other than benefits like car rental, extra coverages, etc...

[benyl]

Originally Posted by aspiring335

No, you do not get anything back for any lease payments!!! Your insurance company has misinformed you or you have misunderstood them. A waiver of depreciation simply ensures you are covered in the event of a shortfall between the value of the car and the amount owing.

Wow, you guys need to talk to you insurance companies.

I have seen it first hand as it happened to my Sister in law about a month ago.

She totaled a 2006 Toyota Corolla S.

The insurance company (hers, not Toyota Finance), paid out the rest of the lease and the buyout. They paid out the full value of the car, to Toyota. $24K. The buyout was $13K and she was in the 35 month of a 36 month lease.

Toyota sent her a check, which I saw in person, for $11K. She basically drove the car for free for the past 35 months (except maintenance, fuel and insurance payments). She even got the GST back. Sure, she will have to pay more for insurance, but it worked out pretty good for her.

My C63 is paid for. My insurance agent said that the coverage I have will pay me out the full purchase price if the there is a total loss of the car in the first 3 years.

In Alberta, a leased car has both the Owner and the finance company on the registration and insurance cards. Not just the finance company.

[BDMBimmer]

Originally Posted by benyl

Wow, you guys need to talk to you insurance companies.

I have seen it first hand as it happened to my Sister in law about a month ago.

She totaled a 2006 Toyota Corolla S.

The insurance company (hers, not Toyota Finance), paid out the rest of the lease and the buyout. They paid out the full value of the car, to Toyota. $24K. The buyout was $13K and she was in the 35 month of a 36 month lease.

Toyota sent her a check, which I saw in person, for $11K. She basically drove the car for free for the past 35 months (except maintenance, fuel and insurance payments). She even got the GST back. Sure, she will have to pay more for insurance, but it worked out pretty good for her.

My C63 is paid for. My insurance agent said that the coverage I have will pay me out the full purchase price if the there is a total loss of the car in the first 3 years.

In Alberta, a leased car has both the Owner and the finance company on the registration and insurance cards. Not just the finance company.

This sounds weird. I always assumed if the book value was more than the buyout than you would get the difference and that was the only way you could get money back when leasing.
My aunt got screwed sort of, she bought a used car and totaled it and the book value was less than what she owed so she had to pay the difference. The salesman screwed her on the deal...
I know on bought/financed cars you can get the full value of the car back for an extra premium.

[dibbz]

Originally Posted by benyl

Wow, you guys need to talk to you insurance companies.

I have seen it first hand as it happened to my Sister in law about a month ago.

She totaled a 2006 Toyota Corolla S.

The insurance company (hers, not Toyota Finance), paid out the rest of the lease and the buyout. They paid out the full value of the car, to Toyota. $24K. The buyout was $13K and she was in the 35 month of a 36 month lease.

Toyota sent her a check, which I saw in person, for $11K. She basically drove the car for free for the past 35 months (except maintenance, fuel and insurance payments). She even got the GST back. Sure, she will have to pay more for insurance, but it worked out pretty good for her.

My C63 is paid for. My insurance agent said that the coverage I have will pay me out the full purchase price if the there is a total loss of the car in the first 3 years.

In Alberta, a leased car has both the Owner and the finance company on the registration and insurance cards. Not just the finance company.

Ahhh...that makes more sense if the leasing company paid you back. I just always assumed that they'd keep it.

[A.Kon]

Originally Posted by BDMBimmer

I know on bought/financed cars you can get the full value of the car back for an extra premium.

Insurance companies usually offer loss/depreciation insurance for purchasers of NEW cars. Not all insurance companies offer it but I think most do.

Basically, in the event of a total non-salvagable accident, the insurance company will refund you the entire purchasr price of the car + applicable taxes with no depreciation charges. I think the insurance companies only offer it for like the first 3 years and the premium gets a lot higher if you want to extend beyond 3 years (probably closer to $50 per month depending on the car if they offer it at all).

It's really a no brainer - everyone who has leased a car should have this depreciation protection just in case you get into a total accident tmrw. If you don't have this protection and you get into a complete loss accident, then you will have to pay BMW whatever you owe but the insurance company will only give you the fair market value of the car.

This happened to my friend a few years ago ... he declined the depreciation insurance which was about $5 per month at the time, then about 8 months after he bought his new car, he got into a huge no fault accident and ended up having to pay the remaining loan to the finance company, while the insurance company only gave him half of the MSRP because that was the market value of his car.

Needless to say he learned his lesson and pays for the depreciation insurance now.

[BDMBimmer]

Does Canada have GAP insurance? If it does I'm getting ripped off by the insurance company since I'm paying a monthly premium and it goes up every year. It looks like in the US you can buy GAP insurance for a one time price around $500 and this will cover you 3-5 years.

[Cookiemonster]

Originally Posted by BDMBimmer

Does Canada have GAP insurance? If it does I'm getting ripped off by the insurance company since I'm paying a monthly premium and it goes up every year. It looks like in the US you can buy GAP insurance for a one time price around $500 and this will cover you 3-5 years.

Gap is included in almost all leases in the USA.