Quote:
Originally Posted by Eric Coffey
IIRR, BMW has fairly tight mileage restrictions on their leases, like 10k/yr. That can bite you, especially if you don't track your mileage closely or use the car a lot (commuter/dd). I would certainly try and negotiate that as well.
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YOU choose your mileage. Plans are 10K, 12K, 15K, or each individual mile thereafter. Buying them up front is simply x-cents/mile with an exact equal offset in residual. Paying as a 'penalty' at the end is ONLY if you do not buy the vehicle, and is much more expensive (but you deferred that cost interest-free and tax-free over 3-4yrs).
Again, YOU are in control. YOU choose how many miles to sign up for. If you consistently put 15K miles/year on your car, sign up for 15K. If you put on 25K miles/yr, sign up for 25K. It's that simple.
If you really screw up and sign up for 10K miles/yr and end up putting on 30K miles/yr what's the worst that can happen? Well, buy the car for the residual and there is zero penalty. You own the car. It's not much different than if you just bought the car in the first place. But you deferred the costs, tax, and final decision for 3-4 years.
Best-case scenario (with over-mileage) is that you happily pay a penalty (usually 20 cents/mile) because it was the lesser of evils than being stuck 'buying' YOUR car out for $20K when it's only worth $15K. And you saved the $5K loss, less your mileage 'penalty', still netted a winner.
People, we pay for the miles we put on a car whether we paid cash or financed or leased. My 2007 F250 with 110K miles is worth less than the same truck with 35K. Duh. How much less is totally market dependent. But in a lease it is guaranteed not to cost more than x-cents per mile, or whatever your contract states.
Leasing is almost a no-brainer if you are in business. And not much different as a private party.