Well this mainly applies to those that have E90's...

Obviously Calgary is a very rich city, but honestly you all seem to be young guys drivin around E90's and I was just curious how you afford it?

Like lease? or Finance? job? etc..

Btw... is leasing or financing a Bimmer better?

Steve

I may not own a e90 or live in Calgary, but heres how I could afford my Bmw. I got my e30 for $2500, when I got $1500 from insurance for a hit & run I was involved in. I saved up the other $1000 by working - that was in January 2007. Now I own an e36 that my dad bought for me & as soon as my e30 sells, I'm paying him back. For the record, I'm only 17.

top choices for young people in bmw's
-engineers
-live at home and parents bought it
-its leased and if they miss one payment the car is repo'd

you are missing drug dealer in your list

Bitches on 3rd work HARD for my car payments. Cavaliers are expensive.

Hustlee

Originally posted by ercchry


you are missing drug dealer in your list

touche

add "making deliveries" to that list

I had no imagination left and since E90s are like civics now I decided what a heck. Dual income, and no kids = money wasted on cars

miss one payment and you loose it? is this only BMW or pretty much all lease vehicles are alike?

my Mommy and Daddy pay for it.

Originally posted by SilverRex


miss one payment and you loose it? is this only BMW or pretty much all lease vehicles are alike?

BMW and Mercedes that Im aware of. Leasing is most popular with these two manufactures because people dont usually like to keep these cars past their 4 year free maintinace program

Nice beemer...

Why does it smell like Pizza ????????

A car payment is only like $500/mo with the right down payment...

Originally posted by crewchaud


BMW and Mercedes that Im aware of. Leasing is most popular with these two manufactures because people dont usually like to keep these cars past their 4 year free maintinace program

Not true with Mercedes...

I think the E90's in question would have a much higher car payment. I see more of them than I see civics.

Originally posted by Aleks




I had no imagination left and since E90s are like civics now I decided what a heck. Dual income, and no kids = money wasted on cars

haha same.... fuk the kids for now! My BMW is my baby. And I don't have to change its diaper or pay for school...

My fiance and I are 25yrs old. Dual full-time income. Paid off all debt when we sold our condo b4 the market just got shitty and made a killing.

In our case, I think we got really lucky

I always say, there's no use saving up for retirement cuz you will be too old to enjoy it.

By no means am I spending my $$ like I piss. But a little endulgence here and there won't hurt the retirement fund.

Have fun if your young.

This is true, a base 328 is about $43k I think.... and if you put a couple of thousand down, you'd be at about $500 - $600/month lease.

My dad has been leasing from Mercedes since '99 and he says otherwise. Read the fine print. Miss a payment and your paying out the lease immediatly or..... Repo

Big sausage pizza

Add engineering tech to that list; the good ones are easily pulling as much as the p.eng's now.

My Tenants are paying for my 335i so it doesn't cost me a dime from my salary.

a new 335i through bmw financing should be about 800-1000 with about 5000-10000 down

The actual lease contract implies that they have the ability to repo after 1 payment is missed but they rarely do unless the customer is a huge risk. It's not unusual for people to go 1,2, even 3 payments behind. The finance company does not want to have to repo the unit so they will give the customer as much opportunity as possible to redeem the account.

That sounds more reasonable. So is that the case with BMW then? Or is it just a straight up, go fuck yourself repo... I've never leased.

Ive heard bmw finance is super super liberal especially when it comes to approving deals, I imagine their collection tactics are the same.. it wouldnt make any business/customer service sense to repo after 1 payment, things happen, contracts get booked late and people often miss their first payments because their file isnt set up yet, people also often make their payments at the end of the month even if their payment is in the middle. Like I said the finance companies are really only super strict if the customer has a derogatory record such as previous credit issues, bankruptcy etc. haha maybe I shouldnt be telling you this though.. its good to have the mindset of not missing a payment, forces you to keep making those payments on time, I've seen people who figure out the system and just milk it for all its worth.

Read this taken from http://forum.e90fanatics.com/e90-e9...cing-guide.html

Leasing v. Financing

I wanted to start a thread that will help people understand leasing and financing. This is a long thread, but it kind of needs to be as there’s a lot to cover. I’m going to talk about misconceptions, define what a lease is, show some examples of leasing versus financing and then list a few pros and cons for both.

First of all let’s talk about some misconceptions in leasing and financing.

Just because you’re financing a car, it doesn’t mean you own it. You do not own a car until you’ve made all the payments. If at month 59 during a 60 month term you decide to not make that last payment, the lender will repossess the car, because the bank still owns it! Unless you pay cash for a car, or make every payment, you don’t own it!

“I don’t lease, I only buy.” A lease is actually another way to purchase a car. The reason people say this is that they think one will always pay more for a car if they buy it out at lease end versus having financed the car for 60 months. Although this can be the case, many times (especially with BMW’s) it can actually be less expensive to lease a car and then buy it, versus financing it for 60 months. Examples to come…

Here’s a contradictory statement some people make: “I want to pay cash for a car because I don’t want a car payment!” Well, if you think about it—they just made a payment. Granted it was only one—but it sure was a big one! So what they’ve done is chosen to make one huge payment versus a bunch of smaller ones. Only bus and bicycle riders can escape a car payment(s).

Dealerships rip people off when they lease cars. True, in the past, leasing had the stigma of dishonesty…and actually they were. This was because the leases were called, “open ended leases.” This had to do with the value of the car at the end of the term and the dishonest part was, dealerships were overvaluing the payoff of the car and people were paying a lot more for their cars than they were worth. Times have changed and now we only sell “closed in leases.” This type of lease locks in the residual value so that one’s payoff will be printed on the contract and cannot be changed by anyone.

“I drive too many miles to lease.” You can still benefit from leasing if you can keep your mileage under 100,000 in any term (at least that’s the way it is for BMW).

“My client advisor said that if I go over miles, it won’t be a problem and they won’t charge me for the excess.” WRONG! If you go over your contracted mileage you’ve depreciated the car. In other words, you’ve made it less valuable and you haven’t paid the lender for it. In some form or fashion, you WILL be paying for those miles, so it’s very important that you’re accurate with your estimates.

“I want to be able to modify my car…so I can’t lease.” Although modification can void warranties, it doesn’t mean you can’t do it. However, a car does need to be in ‘stock condition” IF it’s turned back in. All you need to do is keep the stock parts around!

At any time during a lease, you can buy your car out by sending the bank a check for your payoff. You can trade your car into a dealership and they will send the check on your behalf. You can sell your car in the private party marketplace. You can have someone assume the lease you are currently contracted in.

Whether you lease or finance a car, unless you’ve put a lot of money down, the chances that you will have negative equity are good! Cars simply depreciate faster than we pay them down. This simply means, you’re going to owe more than the car is worth. This is a great reason to consider investing as little as possible into a car—because you’ll rarely break even let alone make money.



How does a lease work?

A lease is made up of three parts: Depreciation, Interest and Tax. (interestingly enough, a finance payment is also made up of those three parts!)

Depreciation is determined by the residual value of the vehicle. For instance, if a bank has placed the value of a 530i at 60 percent after 36 months, you’ll be paying down 40 percent of the cars MSRP (not the selling price). In other words, the bank is estimating that a 2007 BMW 530i will retain 60 percent of it’s value.

The interest you pay is also known as the money factor (and in the finance world, it’s a.p.r.). A money factor will look something like this, .00150. To find out what interest rate that translates to, multiply the money factor by 2400. So .00150 x 2400 is like 3.6 percent.

The tax you will pay is based on your usage of the vehicle. This is one of the reasons your lease payment is lower than a purchase payment. On a purchase, your payment includes tax on the entire cost of the car. The tax you will pay on your lease is dependant upon where you will be registering the car—not where you are purchasing it from.


Now let’s look at some examples of leasing versus purchasing.

We’re going to compare two cars, a BMW 530i and a BMW 335i sedan. I’m going to use actual BMW rates and residuals from the month of November, 2006.

First, the 530i.

MSRP $53,070
Selling price $51,470

Lease Terms:
Payment 669.66 (includes 7.75% sales tax rate)
Drive offs $1,966
Money factor .00090 (2.16% a.p.r.)
Term 36 months
15,000 miles per year
60 percent residual = $31,842 at lease end

Finance Terms:
Payment $1,071.69
Down payment $2,000
Rate 6.99 (700 plus fico)
Term 60 months

Now it becomes simple math.

First let’s look at the overall cost of leasing the car for 36 months and then buying it at lease end. (in the first calculation we use 35 months because our first months payment comes out of the $1,966 drive offs).

35 months x $669.66 = $23,438.10 in payments

$23,438.10 + $1,966 = $25,404.10 in 36 months

So now we’ve driven the car for three years and spent just over 25k and we can either decide to buy the car or go get something else. Now, another common misconception is, if you decide to go buy something else, you’ve lost everything you’ve spent. But this is not true. You’ve driven the car for three years and here’s what you have saved versus financing!!!….

In our 60 month purchase scenario, let’s see how much we’ve spent in the first 3 years of our loan. It’s pretty simple math…

36 x $1,071.69 = $38,580.84

$38,580.84 + $2,000 down payment = $40,580.84 (cost for the first three years)

So during our first three years of the purchase, we’ve spent over 40k versus the 25k we’ve spent in the lease. In both scenarios, we still DO NOT OWN THE CAR yet!!! However, in our lease scenario, we have saved $15,000 in the first three years. We have this money in the bank and available. In our purchase scenario, if we want that money, we’re going to have to HOPE we can get it back by selling the car on the open market.

This brings up another benefit to the lease. In the lease, all the risk (in regards to the vehicles value) is on the bank! Our payoff on the 530i at lease end is just under 32k. If we’re considering purchasing the car, we can now compare the value of the car in the marketplace and determine if it’s a wise decision. If the car is worth more than the payoff, then we get to buy the car for under market value. If on the other hand, it’s worth less than our payoff, then it probably won’t make sense to purchase it. But again, if you walk away, you’ve got that 15k in the bank and driven a great car for 3 years, all while under the factory warranty.

Now let’s say that you’ve decided to purchase this 530i at the end of the lease. Let’s see if you’ve made a good decision.

We’ll take our total of payments and add them to our residual value, along with some tax and interest. In this final calculation we’re going to put down $5,000 of the $15,000 we’ve saved. So in essence we’re looking at financing our remaining balance, minus $5,000 over 24 months. (36 month lease plus 24 month finance = 60 month term)

$25,404.10 in payments and drive offs + $31,842 in residual value = $57,246.10

$57, 246.10 + 2400 in taxes (7.75%) + 2300 in interest (24 months at 6.99) = $61,946.10

So our total cost to lease and then buy is $61,946.10

Now we need to compare that number to what it would have cost us to finance the car from the very beginning.

We’ll take our term of 60 months x our payment of $1071.69. the total of our payments are $64,301.40

But don’t forget to add in the original $2,000 we put down! This makes our total cost to finance the car for 60 months, $66,301.40.

In this scenario, the lease makes the most sense. During the first 3 years the lease saves you $15,000. If you decide to purchase this car, in the end it saves you $4,355.


Now let’s look at the 2006 335i sedan

MSRP $35,220
Selling Price $35,220

Lease Terms:
Payment 678.33 (includes 7.75% sales tax rate)
Drive offs $1,718.52
Money factor .00190 (4.56% a.p.r.)
Term 36 months
15,000 miles per year
61 percent residual = $27,584.20 at lease end

Finance Terms:
Payment $937.17
Down payment $2,000
Rate 6.99 (700 plus fico)
Term 60 months

Since we’ve already talked about all the numbers and what they mean, I’m just going to list out all the calculations for you.

Lease calculations

35 x 678.33 = $23,741.55

$23,741.55 + $1,718.52 = $25,460.07 (total cost for lease over 36 months)

$25,460.07 + $27,584.20 (residual value) = $53,044.27

$53,044.27 + $2,000 (7.775% sales tax) + $2,100 (6.99% a.p.r) = $57,144.27

So our total cost to lease then buy is $57,144.27


Purchase calculations

During the first three years of our 60 month purchase we have spent,

36 x $937.17 = $33,018.12 + $2,000 down = $35,018.12

Total purchase cost equals

60 months x 937.17 = $56,230.20 + $2,000 down = $58,230.20


So our conclusion then is, during the first three years of either scenario, the lease saves us $9,600. In either scenario, in the end, if we buy the car at the end of the lease we saved just over a thousand dollars. In the end it’s almost a wash. Even still, wouldn’t the lease make the most sense then? If it costs the same in the end, why not at least give yourself the option to walk away at the end of the lease with almost $10,000 in your pocket…

The major reason why these two scenarios showed the lease to be better overall is due to the interest rate. Auto loan rates are high right now. I was using a rate of 6.99 percent, which is actually pretty good. Some credit unions may be a percent lower, but that’s not going to make much difference in the payment. The outcome will still be the same.

Along those lines, if the lease rate is high, like .00350 (8.5% a.p.r.) and the purchase rate is low, it may make more sense to purchase. Purchasing makes sense if you like to keep your cars for at least 6 or more years. However, if you’re like most people, you want a new car every two to four years. If you fall into that category and you still purchase your cars, you’ll be spending a lot more money than you have to.

Here is the calculation again so in the future you can determine if leasing or financing is the right choice.

Lease term x Payment + Drive-offs/down + Residual value + Tax and interest on that Residual value

Compare to

Purchase term x Payment + Down payment (and don’t forget to compare the first few years of your purchase term to the lease term)


Here are a few Pros and Cons of leasing and financing

Leasing pros

The risk for the cars value is on the bank
You’ll be able to afford more car for less money
During a 3 to 4 year lease term you’ll be completely covered under the factory warranty
Versus a 60 month finance, you’ll save thousands of dollars during the lease term
You’ll be able to get a new car without having to worry about selling your old one…you get to walk away from the car
If used for business purposes, a tax write off may be possible

Financing pros

You’ll have the “feeling” you’re going to own something
You can modify your car however you want
You can drive as many miles as you want
Insurance coverage can be less if you choose minimal coverage
If your gross vehicle weight is over 6,000 pounds a business tax write off may be possible
If your intention is to keep this car for six or more years, you’ll be without a car payment

Leasing cons

If you’re going to turn the car in, it needs to be in stock condition, making modification difficult
If you’re going to turn the car in, the car needs to be within the contracted miles
If you turn the car in you’ll have to pay for excessive wear and tear such as bald tires, large scratches or dents, and cracked windshields…with normal wear and tear there is no charge
If the car is totaled, any money you put down is lost (however, GAP coverage will take care of any negative equity your car may have)
You may not have the “feeling” of ownership
If you continue a leasing cycle, you’re always going to have a car payment

Financing cons

If you trade in or sell your car within the first few years, it’s going to potentially cost you a lot of money
You don’t actually own the car until you’ve made all the payments
You’ll have to consider spending extra money on extended warranties or suffer the cost of expensive maintenance after the factory warranty expires
Your payment will be much higher than if you leased the same car
The risk for the cars value and payoff is solely on you
Your only option to get out of the car is to sell it to a dealership or private party

Older people are still the hardest to sell on leases... you would think all of their life experience would have taught them something... nope.

^Totally agree with this, many lease because it IS a better financial decision.

What about leasing vs. buying for cash (no financing)

I dont feel like doing all the calculations, but if you figure out how much your car is worth after 3 or 4 years, and how much the 3-4 year ownership would end up costing you, not to mention the hassle of selling and all. Its prefferable to lease.

You could also consider that if you have $60K cash to buy a car, it could be invested VS. if you buy the car straight up you will be losing alot of money in the long run.

Not only old people you have young people who thinks.."I'll pay cash" is a cool thing. Some people are really stupid with their money. If I had $60k cash I would not buy the car I would still lease it. At 4.4% lease rate I would invest the money into something with a higher rate of return.

The worst is people who pay cash when 0% financing is available... Ive seen that too!

good read..

might I add,

I think leasing is good if you know how to manage your funds, other wise the money you save is meaningless if you spend it all by lease term ends.

The fact that you return your car to the dealership is totally throwing money away, while dealerships turn your car around, reconditions it and sell it 5-7k higher than your buyout.

The only concern is dealing with the private sell headache.

Oh and if you do not come up with the buyout cash and have to refinance another 4-5 year term. you'll end up paying much more.

this kind of reminds me of the difference between owning and renting a property. While owning and paying a mortage, the return isnt the greatest of all investments outthere, but it forces people to save money.

But if you are smart with your cash, lease is the way to go

Time Value of money.

Always rent what depreciates, buy what appreciates.

There are a lot of factors to consider. If you don't max out your rrsp every year you can take the 60k and dump it into your or your spouse's rrsp and get a tax saving plus growth. My moderate risk rrsp portfolio returns 10-12% yearly.

This is true. I cringe when I see people just returning the car back to the dealership. If you plan out your time you can sell the car for $5k more than buy out.

My 2000 Prelude buyout was 24k I sold it for 28k
My G35 buyout was 32k I sold it for 36.5k

Originally posted by SilverRex
good read..

might I add,

I think leasing is good if you know how to manage your funds, other wise the money you save is meaningless if you spend it all by lease term ends.

The fact that you return your car to the dealership is totally throwing money away, while dealerships turn your car around, reconditions it and sell it 5-7k higher than your buyout.

The only concern is dealing with the private sell headache.

Oh and if you do not come up with the buyout cash and have to refinance another 4-5 year term. you'll end up paying much more.

this kind of reminds me of the difference between owning and renting a property. While owning and paying a mortage, the return isnt the greatest of all investments outthere, but it forces people to save money.

But if you are smart with your cash, lease is the way to go

Originally posted by SilverRex
good read..

might I add,

I think leasing is good if you know how to manage your funds, other wise the money you save is meaningless if you spend it all by lease term ends.

The fact that you return your car to the dealership is totally throwing money away, while dealerships turn your car around, reconditions it and sell it 5-7k higher than your buyout.

The only concern is dealing with the private sell headache.

Oh and if you do not come up with the buyout cash and have to refinance another 4-5 year term. you'll end up paying much more.

this kind of reminds me of the difference between owning and renting a property. While owning and paying a mortage, the return isnt the greatest of all investments outthere, but it forces people to save money.

But if you are smart with your cash, lease is the way to go

It really depends on the residual however in many many cases you pay the same for the vehicle, the term is just longer because of the lower payments.

Look at it this way
In the beginning of a lease the payments are small the interest rate is lower.
At the beginning of a finance the interest rate is higher, the payments are larger
Say its a 5 year finance and 3 year lease, you reach the end of the 3 years on the lease and on the finance. It is not unusual for the residual to be less than what the vehicle is worth meaning that youre ahead of the game. After 3 years on the finance you might finally be in an equity position but it's still not known for sure. At least with the lease the finance company is handling the risk.

So now its time to buy out the lease, the vehicle is worth more than you owe so youre not risking anything by buying it out and youre getting a great rate because youve stuck with the same company.

You only get jacked on a lease if..you get a bad initial lease rate to begin with, you put cash down (never put cash down on a lease), the residual is much too high but you decide to buy it out anyways.

One thing to remember about a lease though is that you must complete the contract, if you trade a lease vehicle in and you still owe payments on it you are going to get raped.

The only problem with buying out the lease at the end is that car's are worth so much less these day, you have to be sure you can actually get more for it.

Yes to return it is throwing money away. But to buy and sell in 3-4 years is as well, just depends which is more and more of a pain in the ass.

so you think it is much better to lease and return
then it is to finance and keep?

so does it comes down to this?

LEASE
good- new car every 3-4 years
bad - always car payment

FINANCE
good- payment will end
bad - have to sell to buy new


then again one can also say that you can still sell your car that you finance, beside if you are thinking leasing term, you can easily sell your car at a rock bottom price. Since thats what you are face with when you lease anyways.

And on the same token, if you lease, we all know you can own the car out right by paying the buyout.

SO. conclusion.

as long as the interest rates are the same, the end result CAN be the same with both lease and financing.

in my opinion that is..

How much would you end up with if you Invested 60K at 10-15% and withdrew youre lease payment every month?

It all depends on what you are going to do with the car.

If you plan on keeping it for 10 years, then you are better off paying it off quickly and enjoying payment free years. It also minimizes interest.

If 0% finance, then pay it off slowly.

If you like to turn over your cars, then lease them. Residuals aren't always right. There are some cars where you will be upside down at the end of the lease. In that case, give it back.

Anybody want to buy a 330Ci? Low mileage... haha

Lease rates and car loan rates will never be equal. Car manufactures would rather you lease because it almost gaurantees a return customer.

Originally posted by SilverRex


so you think it is much better to lease and return
then it is to finance and keep?

so does it comes down to this?

LEASE
good- new car every 3-4 years
bad - always car payment

FINANCE
good- payment will end
bad - have to sell to buy new


then again one can also say that you can still sell your car that you finance, beside if you are thinking leasing term, you can easily sell your car at a rock bottom price. Since thats what you are face with when you lease anyways.

And on the same token, if you lease, we all know you can own the car out right by paying the buyout.

SO. conclusion.

as long as the interest rates are the same, the end result CAN be the same with both lease and financing.

in my opinion that is..

Hard to quantify like that. I had $60k 3 years ago but instead of buying the 330ci I put the money towards a down payment on a duplex. The duplex more than doubled in value in 3 years. Let's see a paid off car double in value in 3 years. So in my case I am glad I had money that was liquid instead of all locked up in a car. The value went up so much I refinanced and took my 60k back out of the mortgage and the rent still covers the payments.