Your lease is coming to an end and it is time to decide whether or not you want to keep the car you've been driving for the last 2 or 3 years by buying it from the leasing company or leasing a new BMW. 

Usually, the leasing company will give you a call with offers for leasing another BMW 30 to 60 days before the lease expires and gauge where you are in the decision-making process.

This is a decision that shouldn't be made lightly and especially not when you are on the phone with the dealer's rep.

In the article below we will describe five scenarios where buying the car makes more sense than returning it.

1. Market value is higher than the buyout price. When leasing a new car, the leasing company is trying to estimate what its value will be 24-48 months down the road. The number, called residual value, is used to set the monthly lease payment.
   
   If the leasing company sets the residual value too high, the monthly payments will be too low (monthly lease payments are calculated as follows - negotiated sale price minus residual value divided by the number of months). If they set it too low the monthly payments will be higher but the buyout price will be lower than the market value of the vehicle.
   
   Leasing companies usually sell the vehicles that have been returned at the end of the lease at auctions for used cars. To avoid the hassle, they might offer you a lower buyout price just so they could avoid the time and money associated with selling the vehicle.
   
   
2. The car is well maintained. You've been taking good care of the vehicle during the lease term - you've maintained it to manufacturer's specs, there are only minor scratches and overall there's no other car that you'd rather have than this one. If that's the case keeping it might be the way to go.
   
   
3. The car is in terrible shape. For the first couple years you had the car, you drove it like you stole it and it shows. And you know you'll have to pay for that extra wear and tear at the end of the lease term. As a general rule the greater the damage, the larger the penalty. Buying the car is a way to avoid paying those charges and penalties when the lease ends.
   
   
4. Excess mileage. To be able to more accurately estimate the residual value of the vehicle, the leasing company has to put a cap on the number of miles it can be driven during the lease period. Usually, the limit is 12,000 miles/year but depending on the make and model it could be less than that (BMW has limit of 10,000 miles/year).
   

When this number is exceeded you'll be charged for every mile above it at a rate of about $0.25 per mile which translates into extra $250 miles for every 1,000 miles. Acquiring the car at the end of the lease term is a way to avoid paying those extra charges.

>> Check Out Our Current Lease Offers on New BMWs. To Speak with a Lease Specialist Call us at (570) 338-6955 <<

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