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Old 04-20-2005, 05:52 PM   #1
ba23
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Buying car out after lease

Anyone have any experience with this? My lease is up in 2 or 3 months and I'm trying to decide if I want to a) lease the new 3, b) lease a new grand cherokee (had 2 previously, love them), or c) buy my car off lease.

Its an 02 Jet Black 330i sedan w/black leatherette, the only options I got were auto (I know, not a huge manual fan) and run flats, 35K miles. That's it. MSRP was like 36K and according to my contract the residual value of it is going to be 22K when the lease is up. I don't know, that just seems high to me and I don't want to take a hit on it a few weeks later once the new design 3 comes out.

Does 22K sound decent for it? Kelley Blue Book is crap, but it said it's about that much. I'll be buying a car that is 3 years old, an outgoing model year, I won't have any warranty on it, and most likely no clean up or prep from the dealer. I haven't worked out the numbers but I assume the GC and the new 3 lease will work out to be somewhat similar numbers wise, and the payment for buying out my lease will probably be in the same ballpark as well.

Anyway, comments welcome. Thanks.

(and don't rip on the GC, that HEMI is nasty!)
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Old 04-20-2005, 07:37 PM   #2
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I'd definitely choose option A or B, but that's me.
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Old 04-20-2005, 07:52 PM   #3
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yeah
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Old 04-20-2005, 08:31 PM   #4
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Option C for me.
I'm in the same boat and I have a lease that expires in Feb '07. I've already made up my mind to buy the car out. I love the car and besides if I return the car and/or lease a different car then I'm back to square one. I won't own anything and have nothing to show for all those payments I have been making the last 3 1/2 years.
But, that's just me...
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Old 04-20-2005, 08:40 PM   #5
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Quote:
Originally Posted by ba23
(and don't rip on the GC, that HEMI is nasty!)
I wouldn't be caught dead in anything that said Hemi on it. It is so silly sounding. Duh, hemi duh. I suggest you stick with some class and get another 330i.

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Old 04-20-2005, 09:03 PM   #6
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Go with A or C

I bought a VW off least and never regretted it, but I don't really know if that's a good basis for comparison.

I owned a grand cherokee before my Bimmer as well, but I think the new ones are and considering how many little things broke on mine, i don't know how much I would trust that whole cylinder disable thing oh the Hemi's.
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Old 04-21-2005, 09:08 AM   #7
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The $22k buy out is not bad at all. I would actually go to the dealer your purchased the car from and negotiate the buy out price. I am sure they would rather sell you the car then take it back into inventory. You might be able to save some money, but then again I am not 100% sure if this is something that you can negotiate? I would try.
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Old 04-21-2005, 09:17 AM   #8
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Quote:
Originally Posted by Ronzo
The $22k buy out is not bad at all. I would actually go to the dealer your purchased the car from and negotiate that buy out. I am sure they would rather sell you the car then take it back into inventory. You might be able to save some money, but then again I am not 100% sure if this is something that you can negotiate? I would try.
It's not negotiable as in three years ago he signed a contract (lease) to buy the car for exactly that price.

I personally wouldn't get anything with Hemi on it either, I mean not as a replacement car, a second car, maybe. But, I'm biased - I hate the way they look, so moving along...

You're not going to end up on the upside whatever you do, it's the nature of the car business. 22,000 is not a bad buy out for a 2002 330i w/35,000 miles. I mean, you will find that car on a dealer lot for more than that without question - look at it that way. If you like the car keep it.

My only caution in leasing new 330 is that is locks you in for that period. Buying one may be an option since you can get $4200 off + negotiation now. How about a 2 year lease on a new one, then you will have time to figure out exactly what you want and not stress about the E90?

Good luck
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Old 04-21-2005, 11:36 AM   #9
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How about an option (d): dealers have been taking lots and lots of money off '05s to clear their lots, and used values are tanking as a result. If you want to keep the BMW driving experience, why not see what you would pay to buy or lease an '05?

You will have a shiny new maintenance plan and factory warranty, and since you are not hunting for a stick-shift car, you should have a very wide selection. Drive your car out of warranty and prepare for $1,200 brake jobs, $1,600 control arm replacements, DIY window-regulator jobs, all that jazz. And that's if your car is otherwise a good one. That is one reason it would be worth swapping an '02 for an '05 if the '05 is cheap, even though it's the same car, functionally. Also, new car smell.

If it were me, the '05 prices would also affect my opinion of the Jeep. If there are effectively significant rebates/marketing support for a 3-series, the inevitable US car maker rebates look like less of a bargain.

Quote:
Originally Posted by ba23
Anyone have any experience with this? My lease is up in 2 or 3 months and I'm trying to decide if I want to a) lease the new 3, b) lease a new grand cherokee (had 2 previously, love them), or c) buy my car off lease.

Its an 02 Jet Black 330i sedan w/black leatherette, the only options I got were auto (I know, not a huge manual fan) and run flats, 35K miles. That's it. MSRP was like 36K and according to my contract the residual value of it is going to be 22K when the lease is up. I don't know, that just seems high to me and I don't want to take a hit on it a few weeks later once the new design 3 comes out.

Does 22K sound decent for it? Kelley Blue Book is crap, but it said it's about that much. I'll be buying a car that is 3 years old, an outgoing model year, I won't have any warranty on it, and most likely no clean up or prep from the dealer. I haven't worked out the numbers but I assume the GC and the new 3 lease will work out to be somewhat similar numbers wise, and the payment for buying out my lease will probably be in the same ballpark as well.

Anyway, comments welcome. Thanks.

(and don't rip on the GC, that HEMI is nasty!)
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Old 04-21-2005, 11:46 AM   #10
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Yeah, this is killing me b/c I bought my first 2 cars and leased my next 2. Definitely like leasing just b/c you don't worry about any repairs, get a new car every 3 years, and don't have to worry about selling your car when you want a new one. Obviously some people will say well, you don't own anything at the end of your lease, you're just throwing your money away. Which is kind of true, but my girlfriend's last 2 cars (civic and maxima) were a nightmare to sell and she ended up getting screwed financially b/c no one wanted the cars when she went to sell them and ended up letting them go for less than she thought they were worth. I guess there are just pro's and con's to each.

My thoughts on each one is that I love the grand cherokee. What can I say, some people like cars and some don't, but I think that is a nice car and I've owned 2 of them. Definitely toeing the line of reliability with them, but hey my 330 broke down and left me stranded on the turnpike once too. The new 3 is very nice (was at the chelsea piers unveiling, thought it was awesome), but after having a sedan I really want the coupe (which isn't coming out anytime soon). So I'd be getting a car that I am not 100% completely wanting, although I do like it a lot. And buying my car is just a financial decision I guess, I'll pay it off in 3-4 years and then when I go to sell it I'll have a couple grand to put towards another car. I'm just indifferent about my 330 now, don't love it, don't hate it. It's just a nice car that I wouldn't mind keeping if the price was right, gets good gas mileage (better than the jeep, which is a concern), and has been relatively problem free except for the time it broke down on the highway. Although I have had this weird transmission "slip" for a year and a half now that bmw can't seem to find anything wrong with the car, so that worries me b/c those things tend to break as soon as your warranty runs out.

I know on the owner's circle website it says that bmwfs doesn't negotiate the buy out after a lease, but I'm not sure if that just means you have to call the dealership and try to work it out with them. Going to place a call over to my dealership and find out.

Anyway, thanks for the replies, if anyone else has any experience with this I'm all ears.
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Old 04-21-2005, 11:53 AM   #11
ba23
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Quote:
Originally Posted by norihaga
How about an option (d): dealers have been taking lots and lots of money off '05s to clear their lots, and used values are tanking as a result. If you want to keep the BMW driving experience, why not see what you would pay to buy or lease an '05?

You will have a shiny new maintenance plan and factory warranty, and since you are not hunting for a stick-shift car, you should have a very wide selection. Drive your car out of warranty and prepare for $1,200 brake jobs, $1,600 control arm replacements, DIY window-regulator jobs, all that jazz. And that's if your car is otherwise a good one. That is one reason it would be worth swapping an '02 for an '05 if the '05 is cheap, even though it's the same car, functionally. Also, new car smell.

If it were me, the '05 prices would also affect my opinion of the Jeep. If there are effectively significant rebates/marketing support for a 3-series, the inevitable US car maker rebates look like less of a bargain.
Damn, you just scared the hell out of me with all that repair talk! That's why I'm a fan of leasing, although I hate having to watch how many miles I drive (which I'm doing now for these last few months).

But I did think of going w/an 05 3 series as well, but that is just very low on the list for me. My girlfriend bought an 02 Maxima just before the new ones came out and that was hell, even though she got a great deal, everytime we saw a new maxima we were like wow, those look so much nicer than this car. Not to mention when we went to sell it NO ONE wanted it! We couldn't believe how much value the car lost b/c the redesigned ones were out. I'm very nervous about that right now, so that probably puts the 05 out of the question. But I really appreciate the suggestion, thanks.
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Old 04-21-2005, 11:54 AM   #12
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What I always do is sell the lease car to a private party. So for example if your buy out is $22K you may be able to sell that car to a private buyer for $24k and use that profit for the cash down on you new lease or purchase. BMW finance allows you to do this. if you go on the web site and get your payoff you can print out the docs to pay it off and have the title assigned to the new buyer. I have done this 3 times and made out nicely!
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Old 04-21-2005, 02:12 PM   #13
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Quote:
Originally Posted by norihaga
How about an option (d): dealers have been taking lots and lots of money off '05s to clear their lots, and used values are tanking as a result. If you want to keep the BMW driving experience, why not see what you would pay to buy or lease an '05?
This assumes that you can find an '05 that you'd want. The pickings are already slim in some (many???) parts of the country. I don't know how true it is, but someone was claiming, a couple weeks back, that there were already less than 30 '05 ZHPs available, between the rockies and the East coast (he supposedly got some BMW guy to look it up in their database).

Quote:
Drive your car out of warranty and prepare for $1,200 brake jobs, $1,600 control arm replacements, DIY window-regulator jobs, all that jazz.
"All that jazz" is probably still less than the (additional) cost of a new car. His buy-out price is $22K. If you assume a new-car cost of $32K, "all that jazz" should still be less than the $10K difference.
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Old 04-21-2005, 04:04 PM   #14
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Quote:
Originally Posted by krbelloff
What I always do is sell the lease car to a private party. So for example if your buy out is $22K you may be able to sell that car to a private buyer for $24k and use that profit for the cash down on you new lease or purchase. BMW finance allows you to do this. if you go on the web site and get your payoff you can print out the docs to pay it off and have the title assigned to the new buyer. I have done this 3 times and made out nicely!

I thought you were on to something here for a second, but I was thinking....what about taxes on the 22K? That would be another $1300. And after just going through selling a used maxima a few months back, I'm in no hurry to be a car salesman again. Nightmare. I know what a car should be worth and what I want for it, but that and what someone will actually pay are two different things. I don't know if I'd take that risk. But thanks for the suggestion. If I bought my car, I'd probably end up keeping it for myself.
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Old 04-21-2005, 04:10 PM   #15
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If you buy, usually 5 year term, you have a car which you own at the end.
But, now you have a 5 year old car that you own which is going to start costing money everytime something goes wrong, and it will. Afterall, the car is getting older not newer.
So, buying is a good thing, but you have to be prepared to want to own an older vehicle with lots of miles that will require greater and greater maintenance to keep it running, while it's still getting older and older.

There is one other option which you haven't mentioned and that is to sell your car. Since you have a couple of months before it's due, then put it in a picture ad and try to sell it for a bit more than the buy out. If it sells for a bit more, that's great. Now, all you owe to BMW is the amount of purchase price or the car. Give them their money and be on your way to any option you want now.

If you decide to lease the new E90, then returning the current lease and getting a new lease would be more advantageous as they like returning lease buyers. You can probably get them to wave any current lease return costs as well as new lease startup costs. Releasing puts you in a preferred status as you are a return/repeat customer, and gives you some credibility.
Plus, you can order the exact new 3 you want and negociate the best price.
Also, if your new car won't be ready for a few months, maybe 1 or 2 months, beyond your current turn in time, I've heard that the dealer and BMW may allow you to continue to use your current lease until your new car comes in with no penalty. It makes for good customer service and an incentive to keep you as a customer.

Good luck with your decision. For me, I would not even consider an SUV let alone a Cherokee, too many issues with those cars.

TT
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Old 04-21-2005, 04:15 PM   #16
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Quote:
Originally Posted by ba23
I thought you were on to something here for a second, but I was thinking....what about taxes on the 22K? That would be another $1300. And after just going through selling a used maxima a few months back, I'm in no hurry to be a car salesman again. Nightmare. I know what a car should be worth and what I want for it, but that and what someone will actually pay are two different things. I don't know if I'd take that risk. But thanks for the suggestion. If I bought my car, I'd probably end up keeping it for myself.
The tax burden is not yours. If you live in a state where used cars are taxed, then the buyer will pay the taxes when he/she registers the vehicle.

Yes, selling a car takes a little time and effort. But, it's not like you are in a dealership trying to convince someone to buy a variety of cars. It's one car and the buyer already knows what it is he/she is looking for.
Is a bit of your time worth potentially $2000?
If not, then go with a new lease.

I don't think that the new E90 will devalue the current E46 used market at all. Used BMW's traditionally hold their value. They are more traditional automobiles which tend to hold their value even when a new model comes out. That's why a BMW is one of the top lease-able brands.

TT
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Old 04-21-2005, 04:58 PM   #17
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Quote:
Originally Posted by ba23
I thought you were on to something here for a second, but I was thinking....what about taxes on the 22K? That would be another $1300. And after just going through selling a used maxima a few months back, I'm in no hurry to be a car salesman again. Nightmare. I know what a car should be worth and what I want for it, but that and what someone will actually pay are two different things. I don't know if I'd take that risk. But thanks for the suggestion. If I bought my car, I'd probably end up keeping it for myself.
You do not pay tax. BMW financial structures it so that they release the title to your new buyer. The new buyer pays the tax. Nissan does it differently and they will only release it to you so you do have to pay tax(I went throough this with nissan a few years back myself). Having sold three BMW's it is entirely different. Most people in the market for a used BMW have a hard on for it before they ever see it. My last 3 sales literally took 5 min, and were only listed for about a week to 10 days. Trust me just try it you will thank me. $40 to list on autotrader and your work is done.
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Old 04-21-2005, 05:01 PM   #18
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Quote:
Originally Posted by darrylo
This assumes that you can find an '05 that you'd want. The pickings are already slim in some (many???) parts of the country. I don't know how true it is, but someone was claiming, a couple weeks back, that there were already less than 30 '05 ZHPs available, between the rockies and the East coast (he supposedly got some BMW guy to look it up in their database).

"All that jazz" is probably still less than the (additional) cost of a new car. His buy-out price is $22K. If you assume a new-car cost of $32K, "all that jazz" should still be less than the $10K difference.

If that is true than BMW of Austin has 4 of the 5!
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Old 04-21-2005, 05:02 PM   #19
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Don't buy. The only reasons for staying with a lease car are.

1) You have low miles on the car. Less than 20k.
2) You have invested a lot of money in mods.

Give the car back and lease a new E90.
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Old 04-21-2005, 07:11 PM   #20
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OK first question if you were to buy the car out how would u do it.
Would you get a used car loan or pay cash.
Paying cash is not a good idea and a used car loan is most likely higher interest then lease.
Talk to your dealer about re-leasing the same car they will give u a CPO warranty and u will be under warranty till the lease is up.
If you do plan to buy the car make sure u get a CPO warranty as part of the buy out.
If the car has been reliable and u dont mind driving the E46 shape just re lease ur car.
The E90 lease will be high since the residuals are rediculous.
and the Jeep is a Jeep that should say it all.
I am in about the same boat as you,
MY car is leased and i have pretty low milage on it.
If it stays reliable i will most likely end up Re-Leasing the car at the end with a CPO warranty and run it till the warranty runs out.
I would not buy a car out for cash cause i can put the money to work in my buisness
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