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      02-19-2015, 06:53 PM   #45
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Quote:
Originally Posted by thecurryman View Post
only neg about the deal is that the build date is set to 5/22...
He told me that since its a 111 status dealer lot car, when it is marked as sold then it could move up production a much earlier. Not sure if this is true or not. If it does build in may, id get the car in July which kinda makes getting a 2015 pointless...
That is potentially true. Priority 4 cars are the lowest (AFAIK), but placing the order would switch it to a Priority 1. Not saying it would be a huge change, but it's possible.
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      02-19-2015, 09:28 PM   #46
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Apologies if this is the wrong thread, but I thought I saw somewhere that there's a max the dealer can mark up the MF. I know they're allowed to mark up the acquisition fee by $200 to $995, but what about the MF? Is there a limit other than what they convince someone to pay?

I ask because a friend of mine got royally screwed by one of our local dealers, and being inexperienced, I could have easily fallen into a similar trap. Thankfully I spoke to some other friends and then found this forum.

The dealer didn't disclose his MF, but by reverse calculating from his lease agreement, it appears as though his base rate was .00329 and his 7x MSD bought him down to .0028. His overall rent charge is essentially tripled from what it should be.

This was of course on a fully optioned MSRP car as well :/

Needless to say, after hearing about my significantly better deal via an out of state dealer, he went back to the dealer and was able to get a lease unwind and a much better, although still outrageous deal. He's also contacted BMW directly to express his displeasure, so we'll see how that goes.
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      02-19-2015, 10:30 PM   #47
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Originally Posted by thecurryman View Post
Just got off the phone. The incentive is applied as a cap cost reduction (so no I am not paying the $1000 but my rebate is) because its considered a rebate that BMW gives. If the the 1000 comes off the sale price vs cap cost is there a significant difference in the monthly payment?

only neg about the deal is that the build date is set to 5/22...
He told me that since its a 111 status dealer lot car, when it is marked as sold then it could move up production a much earlier. Not sure if this is true or not. If it does build in may, id get the car in July which kinda makes getting a 2015 pointless...
Not pointless at all. One of the benefits of leasing is getting a car at the end of the model year doesn't hurt much. It would only matter if you had a change in the upcoming model year you really wanted. This is a low key LCI change (not like the E90 M3); LED tail lights, some trim bits, and an iDrive software update. Maybe some new colors. Not much to get excited about. Also you would likely be looking at a price increase for 2016 and possibly a harder time getting a deal.
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      02-19-2015, 10:35 PM   #48
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Originally Posted by Thrak View Post
Apologies if this is the wrong thread, but I thought I saw somewhere that there's a max the dealer can mark up the MF. I know they're allowed to mark up the acquisition fee by $200 to $995, but what about the MF? Is there a limit other than what they convince someone to pay?

I ask because a friend of mine got royally screwed by one of our local dealers, and being inexperienced, I could have easily fallen into a similar trap. Thankfully I spoke to some other friends and then found this forum.

The dealer didn't disclose his MF, but by reverse calculating from his lease agreement, it appears as though his base rate was .00329 and his 7x MSD bought him down to .0028. His overall rent charge is essentially tripled from what it should be.

This was of course on a fully optioned MSRP car as well :/

Needless to say, after hearing about my significantly better deal via an out of state dealer, he went back to the dealer and was able to get a lease unwind and a much better, although still outrageous deal. He's also contacted BMW directly to express his displeasure, so we'll see how that goes.
This is an appropriate thread for your question.
Yes there is a cap on the MF markup. Currently BMW allows a dealer to mark up lease rates up to 0.0004

MF markup is a hidden profit center for many dealerships. Thankfully we have access to the base number.

There are circumstances where paying a higher MF is tolerable (huge discount on price of the car, lots of reduced price/free aftermarket parts, etc), but the general rule is try to always pay the base rate.
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      02-19-2015, 11:11 PM   #49
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Originally Posted by OneRib View Post
This is an appropriate thread for your question.
Yes there is a cap on the MF markup. Currently BMW allows a dealer to mark up lease rates up to 0.0004
Hmm, so either my math is off, or the dealer did something not allowed by BMW? As I said, I calculated the MF out as .0028 after max MSD, .00329 before. Which is an increase of significantly more than .0004 above buy rate. Am I incorrect in my calculations?
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      02-19-2015, 11:36 PM   #50
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Hmm, so either my math is off, or the dealer did something not allowed by BMW? As I said, I calculated the MF out as .0028 after max MSD, .00329 before. Which is an increase of significantly more than .0004 above buy rate. Am I incorrect in my calculations?
I get 0.0028 also. Was this a recent deal?

Could be your friend's credit is trash and had to pay a marked up MF. The base rate everyone quotes is for tier 1 credit only.

I doubt the dealer could make a mistake that big and have no one catch it.
It's well above any recent base rate.
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      02-20-2015, 12:04 AM   #51
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Deal was Black Friday. Obviously the Black Friday rebate the dealer discussed, as well as loyalty cash he should have been due (I'm not sure if there was loyalty cash at the time, but he had purchased his previous 335 from the same dealer ~4 years ago) don't appear to figure into his lease deal at all - pocketed by the dealer I'm assuming.

I don't know his credit score, but based on what I know of his financial situation, it's inconceivable to me that he'd be under 850. He paid for his 335 in cash, but decided to try leasing to get a new car more frequently. This experience may have soured him, although at least my getting a good deal allowed him to renegotiate 3 weeks after signing his leasing agreement and bring his payments down to $1200 a month.

The dealership may have made a hell of a profit off of this transaction, but they also essentially blackballed themselves from a good number of people in our friend and professional networks.

He spent a good 30 minutes on the phone with a tier 2 case manager at BMWNA who was not pleased with the story.
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      02-20-2015, 12:14 AM   #52
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Quote:
Originally Posted by Thrak View Post
Deal was Black Friday. Obviously the Black Friday rebate the dealer discussed, as well as loyalty cash he should have been due (I'm not sure if there was loyalty cash at the time, but he had purchased his previous 335 from the same dealer ~4 years ago) don't appear to figure into his lease deal at all - pocketed by the dealer I'm assuming.

I don't know his credit score, but based on what I know of his financial situation, it's inconceivable to me that he'd be under 850. He paid for his 335 in cash, but decided to try leasing to get a new car more frequently. This experience may have soured him, although at least my getting a good deal allowed him to renegotiate 3 weeks after signing his leasing agreement and bring his payments down to $1200 a month.

The dealership may have made a hell of a profit off of this transaction, but they also essentially blackballed themselves from a good number of people in our friend and professional networks.

He spent a good 30 minutes on the phone with a tier 2 case manager at BMWNA who was not pleased with the story.
That deal is highway robbery
I feel for your friend. BMWNA should do everything they can to penalize that dealer. Those are the type of greedy deals that cause BMW to lose customers, not just that dealer.

Glad you and your friend now know the truth and you were able to avoid that type of piece of trash deal.
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      02-20-2015, 08:38 AM   #53
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I'm wondering if he should contact BMW FS as well. As I said, if there's no reason for me to suspect he wouldn't be tier 1, and our calculations are correct, then the dealer more than doubled the MF. If BMW FS is only supposed to let the dealer add on .0004, than I wonder how this passed through them. He should probably ask how the deal was allowed on their end.
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      02-20-2015, 10:51 AM   #54
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Quote:
Originally Posted by Thrak View Post
I'm wondering if he should contact BMW FS as well. As I said, if there's no reason for me to suspect he wouldn't be tier 1, and our calculations are correct, then the dealer more than doubled the MF. If BMW FS is only supposed to let the dealer add on .0004, than I wonder how this passed through them. He should probably ask how the deal was allowed on their end.
It couldn't hurt. I would call them if it was me.
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      02-21-2015, 09:55 AM   #55
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I've never leased before and have always financed my cars but I'm started to look towards doing leases instead since I get a new car every couple of years and don't put many miles on them. It seems I would be a better fit for leasing than financing as I won't be losing out on so much money with each new vehicle this way.

My question to you guys is, I'm currently financing my C400 and have approx. $5,000 in "equity" on it (maybe more, maybe less depending upon current values) so what happens to that "equity" if I were to trade it in and do a lease? Can that be applied to MSDs so that I can get that money back at the end of the lease? Or does it only go into cap cost reduction?
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      02-21-2015, 10:01 AM   #56
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Well, it is your money. I'm sure they'd try and get you for cost cap, that's what they would ideally want if they've got you leveraged in. You should be able to apply that towards whatever you want. Really, you could say that you don't want that $5000 to go towards anything and that you'd like a check.

Consider getting a carmax offer for shits and giggles. See what they'll offer. I've used it to my advantage to get more for my trade.
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      02-21-2015, 01:33 PM   #57
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Quote:
Originally Posted by chicagofan00 View Post
My question to you guys is, I'm currently financing my C400 and have approx. $5,000 in "equity" on it (maybe more, maybe less depending upon current values) so what happens to that "equity" if I were to trade it in and do a lease? Can that be applied to MSDs so that I can get that money back at the end of the lease? Or does it only go into cap cost reduction?
Traditionally a dealer will apply any trade in value as a cap cost reduction (mostly because that's what people assume you do on a lease to lower the monthly payments). You could ask for the equity to be applied in MSD's, but the dealer may balk and want to lower the trade in value.
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      02-21-2015, 09:06 PM   #58
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Very interesting thread. Let me add the lease calculation here. This is the formula that dealers use to calculate the lease payment:

If the residual value is "R" ; R = MSRP x Residual (%)
The Capital cost (sales price) is "C"
Money Factor is "MF"
Down payment is "D"
Lease term is "N" ; number of months (ie 36 or 39)
Monthly depreciation fee "MD" = (C-D-R)/N
Monthly lease fee "ML" = MF * (C-D+R)
Then the monthly lease payment= MD +ML + tax
Drive off : The upfront money including all other fees ( bank fee , acquisition fee, license fee, etc) + first month payment


For example.
MSRP =100k
Capital cost (sales price after 10k discount) = 90k
MF = 0.0013
Residual = 60% = 60k
lease term = 36 months
Down payment = 0
other fees = 2K
tax = 8%

MD = 30k/36 = 833.3
ML = 195
tax = %8 * (833.3 + 195) =82.2
monthly lease payment = 833.3 + 195 + 82.2 = 1110.5

Drive off = 2000 +1110.5 = 3110.5

Note: according to tax, this calculation is based on CA tax which is tax on lease cost. some states calculate the tax based on whole capital cost.
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      02-21-2015, 10:38 PM   #59
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Quote:
Originally Posted by M6-Coupe View Post
Very interesting thread. Let me add the lease calculation here. This is the formula that dealers use to calculate the lease payment:

Thanks for the great post. I'm going to add it to my original post. Giving you credit of course.
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      02-22-2015, 12:23 AM   #60
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Quote:
Originally Posted by M6-Coupe View Post
Very interesting thread. Let me add the lease calculation here. This is the formula that dealers use to calculate the lease payment:
This is very helpful, thanks for taking the time to break down the calcs. I have never leased before, and have been scanning through various lease threads to make sense of the different variables...and you posted this easy calculation just in time. Between OP and your calculation breakdown, this should become a sticky. I am picking my car up on Tuesday, and given the 63% residual and .0013ish MF, I am leaning towards a 36 month lease.
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      02-22-2015, 09:54 AM   #61
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Quote:
Originally Posted by Vectors2final View Post
Well, it is your money. I'm sure they'd try and get you for cost cap, that's what they would ideally want if they've got you leveraged in. You should be able to apply that towards whatever you want. Really, you could say that you don't want that $5000 to go towards anything and that you'd like a check.

Consider getting a carmax offer for shits and giggles. See what they'll offer. I've used it to my advantage to get more for my trade.
Quote:
Originally Posted by MRCUR View Post
Traditionally a dealer will apply any trade in value as a cap cost reduction (mostly because that's what people assume you do on a lease to lower the monthly payments). You could ask for the equity to be applied in MSD's, but the dealer may balk and want to lower the trade in value.
Thanks guys.
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      02-22-2015, 04:19 PM   #62
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Hey guys I am currently working on getting and f80. Can you let me know if this is a good deal?

F80 m3
Msrp = $70,900
39 months
12k annual miles
$3000 total out of pocket (covers all fees, first month payment, and everything in between)
$735 a month
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      02-22-2015, 04:26 PM   #63
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Quote:
Originally Posted by tsela_f80 View Post
Hey guys I am currently working on getting and f80. Can you let me know if this is a good deal?

F80 m3
Msrp = $70,900
39 months
12k annual miles
$3000 total out of pocket (covers all fees, first month payment, and everything in between)
$735 a month
Hard to tell without knowing what and how much the fees are, what is the MF, and are they giving you the correct residual.

If I had to guess from the month payment, it looks like a good deal.
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      02-22-2015, 04:48 PM   #64
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Originally Posted by tsela_f80 View Post
Hey guys I am currently working on getting and f80. Can you let me know if this is a good deal?
We need a lot more detail to really see what's going on. What's the MF? Selling price? Acquisition fee? Other fees?
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      02-22-2015, 04:59 PM   #65
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I will have full break down on numbers tomorrow. Will keep you all posted.
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      02-22-2015, 07:58 PM   #66
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Quote:
Originally Posted by OneRib View Post
Not pointless at all. One of the benefits of leasing is getting a car at the end of the model year doesn't hurt much. It would only matter if you had a change in the upcoming model year you really wanted. This is a low key LCI change (not like the E90 M3); LED tail lights, some trim bits, and an iDrive software update. Maybe some new colors. Not much to get excited about. Also you would likely be looking at a price increase for 2016 and possibly a harder time getting a deal.
Thanks! Do you have an idea of if those iDrive updates could be applied to pre-lci?

Anyways here is a bit of an update: Went to the local dealer who had allocations for a much sooner production. Dealer said that they will match the deal I had negotiated with the OOS dealer. Said they'd keep my out of pocket and monthly payment the same but with a much much earlier production date. Is there anything I should really watch out for? I assume that since my out of pocket is the same (same rebates/incentives) Id be spending the same amount at either dealer and my monthly stays the same which is nice.
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