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Do it again... (archive)

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Posted by jvr on August 13, 1999 at 16:00:18:

In Reply to: Re: Jon Shafer: 528i for $449/month @ Weatherford posted by JeffH on August 13, 1999 at 03:52:51:

I'll just tell you that you cannot assume Cap is MSRP, and you cannot assume they use MSRP to calculate the depreciation. That number can be inflated to an "adjusted MSRP" to make the numbers work. Nor can you realistically get .00138 money factor from BMWFS, as far as I know. Maybe this is one of those "Multiple security deposit" deals, dunno. Security deposit is your payment rounded to the nearest $50, unless you're a returning BMWFS customer , then you may not have to put one down at all. Also remember you pay sales tax on the Cap Reduction. DMV fee is about 1.6% of cap cost. You DO NOT pay sales tax on the Cap, it's paid on your monthly payment each month.

Based on what I know, here's how I calculate this deal with the same assumptions:

MSRP: 39470
CAP Cost: 39470
Cap Red: 2500
Money Factor: .00193 (4.6%, not bloody likely)
Residual %: 67%
Lux Tax: 58
DMV: 592
Security: 450

Cap Price: 37450
Depreciation: 11005
Residual: 26445
Payment: 415
Tax: 34
Total Monthly Payment: 449
Due at signing (first pmt, security, doc fee, DMV, Cap Red, Tax on Cap Red) : 4735

A more realistic Money factor is .00275. If you inflate the MSRP by 4000 and leave the same Cap and Cap Reduction, you get the about same monthly payment. I've seen this done with a friend's Jeep lease just yesterday. It is possible - it's called and "Adjusted MSRP".

I went to Weatherford in March and they were practicing two sneaky tactics. First was they added 1% (.00042) to the BMWFS money factor at their finance department. This is additional money THEY get from the lease. Don't know how they can do it or how it works, but I called them on it and they fessed up. Secondly, they added $200 to the doc fee for a total of $680. This money also went to them directly as added profit.

From a previous BMW leasing experience, I learned that the finance person can make the Doc fee whatever they want up to $2000. I know this because a dealer tried to sneak in a $1500 doc fee to my lease. Since I was running the numbers as he did, I found it immediately and questioned it. He came clean with the info. I laughed and said "Make it $400 like everyone else or I'm outta here!" That was in 1996, so the amounts have changed a little.

The bottom line is, this "Internet Special Deal" is a teaser. They will not have this car exactly as it is stated and I'm pretty sure they'll work a 'new deal' once you're sitting down there. Know how leasing works, make them disclose every penny, do the math at their desk, make them sign every piece of documentation of your deal, especially if they have to locate you a car. I say this for every dealership, except Cutter Motors, not just Weatherford. I've been to many and am on my 3rd leasing experience. I've been burned about every way possible except for the last one. My dealer was honest, gave me full disclosure, and has earned all of my future business.

'99 528i Sport

: If you do the math, using the 528i as an example, they are offering the following terms:
: Cap Cost $39,470
: Cap Cost Reduction $2500
: Mo. Payment $449
: Lease term 36 Mo
: Milage 30K (This is quite low, and you usually pay about $.15 per mile over this at lease end, unless you purchase the car.)
: Residual Factor 67%
: Money Factor .00138 (This is very good)
: Total due at signing $3379 (Cap reduction + deposit + 1st months pament)

: The catch is you have to pay the following fees up front, IN ADDITION to the "Due at signing" amount listed above:

: $3,256.28 Sales Tax (@ 8.25% CA)
: $700.00 Licence Fee (Approximate)
: $100.00 Doc Fee (Guesstimate)
: $540.00 Luxury Tax
: $250.00 Acquisition Fee (Guesstimate)
: $250.00 Disposition Fee (Guesstimate)
: ----------
: $5,096.28 TOTAL!!!

: So you must come up with over $8.5K cash up front to lease this car!

: If you roll all of the above fees into the lease by adjusting the cap. cost, your monthly payment would be about $491 and your total amount due at siging would be about $3441.

: Really not to bad a deal, but remember this is for no option car!! And at the end of the 36 months you own squat, excpt for your $450 security deposit refund.

: Also, they are charging full MSRP for this car! If you were to buy it you should be able to negotiate MSRP - $1500 without much trouble.

: Assuming you get MSRP -$1500, If you were to buy this car the terms might be approximately:

: Down payment = $8,500
: Amount Financed = $42,407 (Includes Sale price and all taxes and fees)
: i = 7.5%
: n = 60 mo
: Payment = $679 /mo

: Jeff

: :
: : what's wrong with this picture? Jon's response to an earlier posting seems to indicate that this is too good to be true ... can somebody pl clarify?

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