[edkato]

I am extremely happy to get out of the lease on my X3 and purchase my current F30 328i Xdrive...anyone else purchasing and not leasing? I was putting on lots of miles and I do like BMW performance accessories, so now I can drive, mod, and not worry. Just seems like everyone leases these days...

[Mike_L]

I went in planning to lease, but a BMW Select buy made more sense. My payments are lower, i actually hold the title for the car, and after a couple of years I'll have positive equity in it. Didn't make sense to lease, especially since I'll never have to make the balloon payment on the car after 5 years because I won't have it any more.

[bahasad]

Originally Posted by edkato

I am extremely happy to get out of the lease on my X3 and purchase my current F30 328i Xdrive...anyone else purchasing and not leasing? I was putting on lots of miles and I do like BMW performance accessories, so now I can drive, mod, and not worry. Just seems like everyone leases these days...

I leased my F30 (first car I’ve leased). I see the advantages of leasing – I get bored with cars very quickly (the longest I’ve kept a car was 2 years, my E36), so it gives me the advantage of switching. Lower monthly. When purchasing, you have to eat that depreciation, unless you keep the car for longer than 3-4 years. You also are stuck with the car, unless you resell it (which is easier than returning a lease early). The definite advantage is you can drive more mileage (but you will cause more depreciation).
I am modding my leased car anyways haha, just being careful to put mods I can easily take off.
Definite trade-offs to both, have to judge individual situation.

[tboooe]

Originally Posted by bahasad

Definite trade-offs to both, have to judge individual situation.

I do both...I buy my beater car that I intend to keep for a long time and lease my fun car.

[erichighley]

After the hassle of trying to sell my e92, I'm glad to say I opted to do my first lease this time around with the F36. We'll see how it pans out, but the simplicity of being able to walk in/walk out with a new car at the end will be a welcomed change to owning.

On the other hand, I hope having to keep an eye on my miles doesn't take away from the joy of driving.

[Toybota]

Originally Posted by erichighley

After the hassle of trying to sell my e92, I'm glad to say I opted to do my first lease this time around with the F36. We'll see how it pans out, but the simplicity of being able to walk in/walk out with a new car at the end will be a welcomed change to owning.

On the other hand, I hope having to keep an eye on my miles doesn't take away from the joy of driving.

Only $0.16/mile if you buy it few months before lease return. I wouldn't worry about it so much.

That said, I might buy my next car, depending on what it is.

[shoptb]

Originally Posted by Mike_L

I went in planning to lease, but a BMW Select buy made more sense. My payments are lower, i actually hold the title for the car, and after a couple of years I'll have positive equity in it. Didn't make sense to lease, especially since I'll never have to make the balloon payment on the car after 5 years because I won't have it any more.

Can you explain the BMW Select program a little more? Isn't there a larger balloon payment at the end before you have positive equity, aka, the payoff in the middle is higher so you might be negative before the balloon payment?

[Sharp_Cai]

I only buy Japanese cars and lease European cars.

[erroberts1]

Originally Posted by edkato

I am extremely happy to get out of the lease on my X3 and purchase my current F30 328i Xdrive...anyone else purchasing and not leasing? I was putting on lots of miles and I do like BMW performance accessories, so now I can drive, mod, and not worry. Just seems like everyone leases these days...

It's truly a matter of personal preference. I'm a younger guy who doesn't have a ton of cash reserves in place, but I also don't have much debt. Leasing represents an opportunity to stretch a little to get into a car that I want and still have positive cash to put into appreciating investments. It helps that I don't have a huge mileage requirement, but I personally enjoy having a new car and not having to bankroll the maintenance.

In my view, I can lease roughly three vehicles over nine years for the same cost as owning one. At the end of my third lease I will be preparing to enter into my fourth new vehicle while a buyer is potentially facing the decision to continue to maintain a nine year old car, or has at some point hit the reset button and rolled remaining equity into a new purchase.

For those who value "having no car payment" more power to you! But what will you use that equity for except for the acquisition of a new vehicle? I view a car payment as a cost for the privilege of driving a car, the same as I might consider my cable or electric bills.

Again, personal preference, but I don't view a vehicle as a good investment for two reasons: 1.) asset value is guaranteed to depreciate and 2.) the same "positive return" (utility and enjoyment, almost exclusively) can be achieved for less.

[335BOY]

Positives and negatives for both depending on personal situations. Many are leased so that you don't have to take money out of a money making (market) situation to put into a depreciating asset. Many companies (particularly small ones) do that to keep cash in the business. I think leasing is almost always more expensive but your costs are fixed(never have that $2500+++ service/repair surprise) and you can get in and out of new cars fairly easily. Some brands are better to lease and some are better to buy......buying an Aztek wouldnt have been very smart....having said that leasing one wouldnt have been much smarter but at least you could give it back. I wonder if you can even GIVE them away now?
This is always a very contentious subjct..............

[KneeDragr]

Originally Posted by shoptb

Can you explain the BMW Select program a little more? Isn't there a larger balloon payment at the end before you have positive equity, aka, the payoff in the middle is higher so you might be negative before the balloon payment?

I believe you negotiate your payment, and the balloon is whatever is left. So you can pay enough so ensure positive equity if you want. Or you can bury yourself and refinance a mountain of negative equity at the end. I was at a dealership once when some dude tried to trade in a car with a balloon payment due on it, was pretty hilarious the fit he threw when they explained his situation to him.

The big downside compared to a lease, is that you pay interest on the entire car vs only on the depreciation.

[G30 B58]

Built for me and bought by me.

[shoptb]

Originally Posted by KneeDragr

The big downside compared to a lease, is that you pay interest on the entire car vs only on the depreciation.

I just have a hard time finding a lot of benefit in purchasing a brand-new BMW when I only keep vehicles for a max of 3 years. If I do this, I'm basically eating all of that massive "drive-off-the-lot" depreciation, whereas with a lease, I'm not stuck with that. It sounds as though the BMW Select is just choosing whether you want to pay more for the car during the payments or with a lump sum at the end.

[edkato]

Originally Posted by F32 N55

Built for me and bought by me.

While I see all sides of the issue, this is the best comment yet. Nice!

[Mike_L]

Originally Posted by shoptb

Can you explain the BMW Select program a little more? Isn't there a larger balloon payment at the end before you have positive equity, aka, the payoff in the middle is higher so you might be negative before the balloon payment?

That was what I thought, but its not working out that way. My balloon payment after 5 years is just $24k. According to Intellichoice, the car will be worth 54% of its new value after 5 years (~$35k), so if I see the loan out the whole 5 years, I'd have $9,000 equity in it. The dealer was aware that I have no intention of keeping it more than 3-4 years, but they still figured out that this was a better deal for me. I'm paying $718 a month, versus the $753 the 3yr lease would have cost me. I'm also only paying like 2.5% interest versus the 3.09% they charge on a lease and was able to take the taxes off for the trade, which i wouldn't have been able to do with a lease, so that was a $2500 savings right there (8.875% tax on $32.5k).

I guess I could end up negative if the market plunges, but a long as they're willing to work with me to trade in 3-4 years from now, I'm okay with that risk. Negative equity is nothing new to me, and doesn't really bother me. I had to pay an extra $18k to get the 750 out of the red when I bought this car, so it can't get much worse.

[335BOY]

Originally Posted by Mike_L

That was what I thought, but its not working out that way. My balloon payment after 5 years is just $24k. According to Intellichoice, the car will be worth 54% of its new value after 5 years (~$35k), so if I see the loan out the whole 5 years, I'd have $9,000 equity in it. The dealer was aware that I have no intention of keeping it more than 3-4 years, but they still figured out that this was a better deal for me. I'm paying $718 a month, versus the $753 the 3yr lease would have cost me. I'm also only paying like 2.5% interest versus the 3.09% they charge on a lease and was able to take the taxes off for the trade, which i wouldn't have been able to do with a lease, so that was a $2500 savings right there (8.875% tax on $32.5k).

I guess I could end up negative if the market plunges, but a long as they're willing to work with me to trade in 3-4 years from now, I'm okay with that risk. Negative equity is nothing new to me, and doesn't really bother me. I had to pay an extra $18k to get the 750 out of the red when I bought this car, so it can't get much worse.

I think you have the right attitude. End values are virtually impossible to predict with any accuracy. My e92 wasnt worth anywhere near what BMW told me it would after 3 years.

[snowghost]

Originally Posted by bahasad

I leased my F30 (first car I’ve leased). I see the advantages of leasing – I get bored with cars very quickly (the longest I’ve kept a car was 2 years, my E36), so it gives me the advantage of switching. Lower monthly. When purchasing, you have to eat that depreciation, unless you keep the car for longer than 3-4 years. You also are stuck with the car, unless you resell it (which is easier than returning a lease early). The definite advantage is you can drive more mileage (but you will cause more depreciation).
I am modding my leased car anyways haha, just being careful to put mods I can easily take off.
Definite trade-offs to both, have to judge individual situation.

When leasing, you have to eat that depreciation. No such thing as a free lunch.

[bahasad]

Originally Posted by snowghost

When leasing, you have to eat that depreciation. No such thing as a free lunch.

True, I guess that is what you are paying for.

[Cyberdemon]

Originally Posted by Mike_L

That was what I thought, but its not working out that way. My balloon payment after 5 years is just $24k. According to Intellichoice, the car will be worth 54% of its new value after 5 years (~$35k), so if I see the loan out the whole 5 years, I'd have $9,000 equity in it. The dealer was aware that I have no intention of keeping it more than 3-4 years, but they still figured out that this was a better deal for me. I'm paying $718 a month, versus the $753 the 3yr lease would have cost me. I'm also only paying like 2.5% interest versus the 3.09% they charge on a lease and was able to take the taxes off for the trade, which i wouldn't have been able to do with a lease, so that was a $2500 savings right there (8.875% tax on $32.5k).

I guess I could end up negative if the market plunges, but a long as they're willing to work with me to trade in 3-4 years from now, I'm okay with that risk. Negative equity is nothing new to me, and doesn't really bother me. I had to pay an extra $18k to get the 750 out of the red when I bought this car, so it can't get much worse.

54% seems very optimistic for a 5 year old car when BMW puts most of their 3 year residuals under 60%.

I considered a balloon loan when I bought my last car because the low payment was alluring, but after running the numbers it didn't make sense compared to financing.

Financing in the long run ultimately makes the most financial sense (especially with interest rates @ ~1.5% from most credit unions) since you're more than likely beating inflation at that point (depending on how the economy continues to do). You have a higher payment but you'll get back to positive equity quicker and in the long run if you sell the car after 3-5 years you'll have spent less per month.

Of course that assumes you have the cash flow to make the higher monthly payment.

[pazzo]

Now I pay cash. If I can'the buy it, I can't afford it.
many live beyond there means in today's society.
When I was younger, I always financed, and I made sure I was never upside down. Large amounts down and always had cash to spare. That extra cash was saved and invested. I've always made more in investments, than the amount the vehicle depreciated.

Put it simply, if I was quald for a 500k house, I didn't buy a 500k home, but rather bought a 300k home and saved the difference, building wealth.

[bily]

Just came out of one select and went into a new one. Was about $4500 on the positive. Which I then used for the new car. Put $1k down and will have a balloon of $24k at the 5 year mark on a 3.1% rate. I'm thinking this car, a vert, if in same condition will be worth more. 64 to 24. I don't put a lot of miles on though and I try to take good care of my car.

If you are not a good driver or just tend to have small accidents, or live in a big city, then yes, lease. You give the car back and who cares about the condition of the car and how many times it's been repaired.

The lease numbers were just crazy so it did not make sense for me and I hope to keep it for a while. And if I do want to trade it or sell it I can.

[ryanSTL]

I prefer leasing because...
1. I like to turn cars over every 2-3 years
2. i'm not in a rush to own assets that rapidly depreciate

I'm interested in owning things that I'll keep long term and either appreciate in value, ... or other people ate the depreciation on and I buy used from them.