BMW Garage BMW Meets Register Search Today's Posts Mark Forums Read
BMW M5 F90 (2018+) General Forums F90 M5 General Forum    Re-lease economics

Post Reply
 
Thread Tools Search this Thread
      11-24-2020, 05:43 PM   #1
R123
Enlisted Member
44
Rep
34
Posts

Drives: F90 M5
Join Date: May 2018
Location: NY

iTrader: (0)

Re-lease economics

Are you guys familiar with re-lease residuals for extension above 3 years?

I have a 2018 M5 with lease expiration in May 2021 and I wouldn't mind extending for a year or two.

BMW Financial Services will only quote rates within 60 days of lease expiration.

Any help would be appreciated.
Appreciate 0
      11-24-2020, 07:39 PM   #2
Aronis
Brigadier General
Aronis's Avatar
2267
Rep
3,281
Posts

Drives: 2018 M5
Join Date: Aug 2016
Location: Binghamton, NY

iTrader: (0)

following with great interest.....

I assume they would make you buy an extended warrantee???

Mike
__________________

2018 M5 and 2019 Porsche Boxster GTS
Prior. '94 325is, '97 M3 Lux, '16 M2
Appreciate 0
      11-28-2020, 05:07 PM   #3
R123
Enlisted Member
44
Rep
34
Posts

Drives: F90 M5
Join Date: May 2018
Location: NY

iTrader: (0)

I don't think it is related to extended warranty.

Curious what residuals do they have.
Appreciate 0
      11-28-2020, 08:22 PM   #4
TrevorM3
Banned
3318
Rep
8,083
Posts

Drives: 6.3 AMG
Join Date: Apr 2013
Location: Florida

iTrader: (0)

not sure. but do the math, maybe better to buy it at the end instead?
Appreciate 0
      11-29-2020, 07:00 PM   #5
R123
Enlisted Member
44
Rep
34
Posts

Drives: F90 M5
Join Date: May 2018
Location: NY

iTrader: (0)

Quote:
Originally Posted by TrevorM3 View Post
not sure. but do the math, maybe better to buy it at the end instead?
It has $80k+ residual after 3 years - doesn't make any sense to buy it out.
Appreciate 1
snowbimmer5002.50
      11-29-2020, 08:42 PM   #6
greentrbo95gst
Brigadier General
greentrbo95gst's Avatar
1217
Rep
4,102
Posts

Drives: 21 M5 Comp
Join Date: Jan 2011
Location: Orange County

iTrader: (6)

I thought the max they can extend it is 6 months.
__________________
Current: 21 M5 Comp, 17 X5M, 06 M3, 14 Ferrari FF, Tesla Model S Performance.
Appreciate 0
      11-29-2020, 09:53 PM   #7
frankchn
First Lieutenant
286
Rep
369
Posts

Drives: F90 M5
Join Date: Aug 2015
Location: Bay Area

iTrader: (0)

Not sure BMWFS will extend your lease beyond 3 months (or 6 if you have another BMW on order).
Appreciate 0
      11-30-2020, 10:02 AM   #8
Crumbs
First Lieutenant
190
Rep
306
Posts

Drives: 2018 F85 X5M Mineral White
Join Date: Jun 2012
Location: NYC

iTrader: (0)

Quote:
Originally Posted by frankchn View Post
Not sure BMWFS will extend your lease beyond 3 months (or 6 if you have another BMW on order).
This.
Appreciate 0
      11-30-2020, 11:21 AM   #9
Rcg412
Enlisted Member
26
Rep
32
Posts

Drives: 91 Ford Aspire - stock
Join Date: Oct 2019
Location: Backcountry Greenwich, CT

iTrader: (0)

Quote:
Originally Posted by R123 View Post
It has $80k+ residual after 3 years - doesn't make any sense to buy it out.
it makes sense if a similar car is offered >$80K...
Appreciate 0
      12-01-2020, 11:47 AM   #10
raym3cs
First Lieutenant
raym3cs's Avatar
United_States
153
Rep
388
Posts

Drives: San Marino M3CS
Join Date: Dec 2013
Location: N-NJ

iTrader: (0)

yea i have asked that question when i returned my X6M F86 lease
it was a dealer demo so i got a awesome discount on it when i leased it

i was told by BMWFS max was 6 months
and no option to re-lease the same car
Appreciate 0
      12-01-2020, 02:47 PM   #11
R123
Enlisted Member
44
Rep
34
Posts

Drives: F90 M5
Join Date: May 2018
Location: NY

iTrader: (0)

I wonder what happens to the cars returned from lease. My residual after 3 years is north of $80k and the market price of the car will be $70k at best.
Appreciate 0
      12-01-2020, 04:14 PM   #12
frankchn
First Lieutenant
286
Rep
369
Posts

Drives: F90 M5
Join Date: Aug 2015
Location: Bay Area

iTrader: (0)

Quote:
Originally Posted by R123 View Post
I wonder what happens to the cars returned from lease. My residual after 3 years is north of $80k and the market price of the car will be $70k at best.
BMWFS eats the loss. They will let the dealership you returned your car buy it at market value, and if not, the car gets sent to dealer auction.

BMWFS also won't allow you to circumvent the buyout by getting the dealer to purchase it and selling it to you at a lower price.

You can get around this if you can get someone not having the same address as you to buy it instead.
Appreciate 1
Jimmy K122.00
      12-01-2020, 05:12 PM   #13
Aronis
Brigadier General
Aronis's Avatar
2267
Rep
3,281
Posts

Drives: 2018 M5
Join Date: Aug 2016
Location: Binghamton, NY

iTrader: (0)

Funny if the car is worth MORE than the buy out, BMW does not give you a nice check for the difference at turn in. But they want you to eat the LOST value if you choose to buy the car. Nice.

Mike
__________________

2018 M5 and 2019 Porsche Boxster GTS
Prior. '94 325is, '97 M3 Lux, '16 M2
Appreciate 0
      12-01-2020, 08:18 PM   #14
frankchn
First Lieutenant
286
Rep
369
Posts

Drives: F90 M5
Join Date: Aug 2015
Location: Bay Area

iTrader: (0)

Quote:
Originally Posted by Aronis View Post
Funny if the car is worth MORE than the buy out, BMW does not give you a nice check for the difference at turn in. But they want you to eat the LOST value if you choose to buy the car. Nice.

Mike
To be fair, you can always buy it out and sell it to Carmax if the value is higher. Sometimes individual BMW dealers will facilitate this as well for a cut.
Appreciate 0
      12-01-2020, 10:55 PM   #15
MBBM5
Private First Class
MBBM5's Avatar
United_States
97
Rep
150
Posts

Drives: 2019 MBB M5
Join Date: Mar 2016
Location: Northern VA

iTrader: (1)

Quote:
Originally Posted by frankchn View Post
Quote:
Originally Posted by Aronis View Post
Funny if the car is worth MORE than the buy out, BMW does not give you a nice check for the difference at turn in. But they want you to eat the LOST value if you choose to buy the car. Nice.

Mike
To be fair, you can always buy it out and sell it to Carmax if the value is higher. Sometimes individual BMW dealers will facilitate this as well for a cut.
Exactly. In the past I have actually bought my leased car and sold it to the dealer I was leasing a new car from. Pretty simple - I didn't actually give the manufacture any cash - the dealer just wrote me the $3K check for the difference and I drove off in the new car.
Appreciate 0
      12-02-2020, 10:42 AM   #16
R123
Enlisted Member
44
Rep
34
Posts

Drives: F90 M5
Join Date: May 2018
Location: NY

iTrader: (0)

I have $30k of options in the car that are worth close to zero in the used market, so residual is overstated.
Appreciate 0
      12-02-2020, 02:36 PM   #17
Aronis
Brigadier General
Aronis's Avatar
2267
Rep
3,281
Posts

Drives: 2018 M5
Join Date: Aug 2016
Location: Binghamton, NY

iTrader: (0)

Quote:
Originally Posted by MBBM5 View Post
Exactly. In the past I have actually bought my leased car and sold it to the dealer I was leasing a new car from. Pretty simple - I didn't actually give the manufacture any cash - the dealer just wrote me the $3K check for the difference and I drove off in the new car.
Yes that sounds legal. LOL. Sounds like a "Straw" car sale. Wink Wink.

Mike
__________________

2018 M5 and 2019 Porsche Boxster GTS
Prior. '94 325is, '97 M3 Lux, '16 M2
Appreciate 0
      12-02-2020, 04:11 PM   #18
MBBM5
Private First Class
MBBM5's Avatar
United_States
97
Rep
150
Posts

Drives: 2019 MBB M5
Join Date: Mar 2016
Location: Northern VA

iTrader: (1)

Quote:
Originally Posted by Aronis View Post
Quote:
Originally Posted by MBBM5 View Post
Exactly. In the past I have actually bought my leased car and sold it to the dealer I was leasing a new car from. Pretty simple - I didn't actually give the manufacture any cash - the dealer just wrote me the $3K check for the difference and I drove off in the new car.
Yes that sounds legal. LOL. Sounds like a "Straw" car sale. Wink Wink.

Mike
Ha. Nothing illegal. Just didn't make sense for me to write the manufacture a check and then the dealer write me a check. Dealer just paid me the difference of the trade in value and what my residual was so they could keep the car and sell it.
Appreciate 0
      12-02-2020, 06:14 PM   #19
frankchn
First Lieutenant
286
Rep
369
Posts

Drives: F90 M5
Join Date: Aug 2015
Location: Bay Area

iTrader: (0)

Quote:
Originally Posted by MBBM5 View Post
Ha. Nothing illegal. Just didn't make sense for me to write the manufacture a check and then the dealer write me a check. Dealer just paid me the difference of the trade in value and what my residual was so they could keep the car and sell it.
Yeah, perfectly legal.

This is also what happens when you try to return a leased car early for a new car as well. Dealer buys the lease out by paying the payoff, then you roll the difference between the trade-in value and the payoff (whether positive equity or negative) into the next car loan or lease.

This is probably more common in the Porsche world, where leases are not subsidized and thus have very low residuals. 911s also depreciate slowly so most leasees end up with positive equity at the end of their lease, which they can then cash out or put towards their next lease with the help of the dealer. It is basically like having a call option on your car at a set price at the end of the lease.

There are leases that prevent you from doing that (e.g. Tesla's leases) where there is no buyout at all and you must fulfill the terms of the lease and must return the car at the end, but it is uncommon.

Last edited by frankchn; 12-02-2020 at 06:20 PM..
Appreciate 0
      12-04-2020, 12:08 PM   #20
Aronis
Brigadier General
Aronis's Avatar
2267
Rep
3,281
Posts

Drives: 2018 M5
Join Date: Aug 2016
Location: Binghamton, NY

iTrader: (0)

I invented this kind of lease years ago, but no one would bite.

Year one. Monthly lease based on 12 month short lease, high price but if you hate the car you are out.

Second year, monthly payment equal to the the total cost of a 24 month lease minus the 12 month lease you already paid divided by 12. Again, your payments higher than a 48 month lease but you can walk away if you hate the car.

Third year, monthly payment equals the total of a 36 month lease minus what you already paid divided by 12. See the trend.

End up with the option to walk away without a huge pay out.

By the end of this you'd likely have a 4th year with a monthly payment of 20 bucks. LOL.

No one looses, they get their crazy short term lease payments, but you are not stuck with a car you hate.

Mike
__________________

2018 M5 and 2019 Porsche Boxster GTS
Prior. '94 325is, '97 M3 Lux, '16 M2
Appreciate 0
      06-19-2021, 11:09 PM   #21
R123
Enlisted Member
44
Rep
34
Posts

Drives: F90 M5
Join Date: May 2018
Location: NY

iTrader: (0)

To close my original question I called BMW. My residual was around $80k after 3 years. They proposed 1 year extension with residual of around $40k and monthly lease payment of over $4k. Not negotiable.
Appreciate 0
Post Reply

Bookmarks

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off



All times are GMT -5. The time now is 08:11 AM.




m5post
Powered by vBulletin® Version 3.8.11
Copyright ©2000 - 2024, vBulletin Solutions Inc.
1Addicts.com, BIMMERPOST.com, E90Post.com, F30Post.com, M3Post.com, ZPost.com, 5Post.com, 6Post.com, 7Post.com, XBimmers.com logo and trademark are properties of BIMMERPOST