[mjr24]

So my M550i lease matures March 14.....24 months, 10k miles per year.

I am 24,000 miles over right now. I just bought a M5 so I likely won't put many more miles on it. That being said, I am trying to buy these 24,000 miles before January 1 to be able to write them off on this year's taxes.

Well, first off, they have the M550 classified incorrectly. They have it as a real M car, which means 0.30 per mile at lease end....and 0.27 per mile is the discounted rate they offer if you buy miles at anytime before the end of the lease. They have admitted this is an error. The M550i is still considered a standard 5 series....meaning 0.25 per mile at the end of the lease and miles can be bought before for 0.23 per mile.

They are telling me it's a site issue, however, and they have no workaround for it. In other words, they are insisting I wait until the day before my lease matures in order to buy miles because of this fact (that they have it wrongly classified and have no way right now to charge the correct 0.23 per mile). I told them that doesn't work for me unless they would like to pay the extra $2k in taxes I will have to pay this year because I won't be able to write this off that way. Regardless, BMWFS clearly says you can buy these extra miles ANYTIME before the lease end.

I insisted I want to pay now and I would do a charge dispute for the extra amount if need be. They said if I did pay now, I will be charged the full amount and it will be considered final (in other words, they will make no adjustments). I mean, are you f*cking kidding me? Not sure what to do here....

I feel they are screwing over M550 owners and likely try to charge the higher amount and most don't realize this should be under 0.25 per mile and not 0.30.

[snowbimmer]

What if you just wrote them a letter explaining why you are paying $0.23/mile, enclose a check for $5,520 (24,000 x 0.23) and mail it out this year. You at least get your $5,520 deduction for 2019.

Then you have to be sure BMWFS credits you for 24,000 miles and not 20,444 miles - which is what $5,520 only buys at $0.27/mile. It might be a site issue, but you are sending them a real letter and a check - good to have for documentation if they try to come back at you. The website is out of the picture and a human has to adjust your account.

Don't let them screw you out of $960.

I was in a mileage situation like you, but not quite as bad. I had a 3 year 12,000 mile lease on an M550. I was at 36,000 miles in 24 months and really, really wanted an M5. Another year would have taken me to at least 51,000 miles. I could have ordered a 2020 M5 next year and paid the mileage fees. After seeing a Donnington Grey in June I knew I had to figure something out. Scoured the US, found the spec I wanted (there were only 2). A dealer 1200 miles from home offered 9k off MSRP, plus the lease incentive was another 5k. I was able to buy my M550 from BMW and sell it back to my local dealer for a small loss. Flew down to get my new M5 and drove it home. It was ready for the break in service on day 2. I now have over 10,000 miles and did a higher mileage lease. Hope it's enough.

Good luck with your new ride.

[530iDriver]

More reasons why I dislike leasing. It is just a money grabbing scheme.

[mffarrell]

Originally Posted by 530iDriver

More reasons why I dislike leasing. It is just a money grabbing scheme.

+1

[bMm5w]

To the OP. So in the worst case scenario, you'll just end up having the mileage expense properly written off at the time of return, and possibly losing $48.00 (.02 x 2400)? Doesn't really sound like the end of the world scenario to me...

Originally Posted by 530iDriver

More reasons why I dislike leasing. It is just a money grabbing scheme.

Not if you know WHY you are leasing. The example cited above is a fairly rare occurrence I imagine, and a mistake of this type may also happen at the time of purchase. E.G. inaccurately cited terms or improper applications of rebates.

Shit happens, but above is not a normal occurrence and not a reason to bash leases. Do you know if you lease, then you can write off the vehicle, thereby effectively reducing your car payments by your tax rate? If you have a business paying for your car lease this becomes extremely advantageous, especially if the lease was crafted properly from the inception.

After buying cars for over 20+ years I realized that I was losing more on vehicle depreciation due to mileage and hassle of selling than I did to mileage overruns on leases. I change cars every 2 to 3 years, so now I just lease them, turn them in 3 years later with 45K miles and get a new one. Never stuck in a car again... for someone like me with car ADD, it makes perfect sense, especially when I write off the lease as business expense. When you can drive $100K cars for around $1,200 a month (or $800 effective) and a few K out of your pocket, it becomes far less than depreciation would have cost you on that vehicle if bought new - it really is a no-brainer for those who can take advantage.

[530iDriver]

Originally Posted by DirtyVegasMB

To the OP. So in the worst case scenario, you'll just end up having the mileage expense properly written off at the time of return, and possibly losing $48.00 (.02 x 2400)? Doesn't really sound like the end of the world scenario to me...

Not if you know WHY you are leasing. The example cited above is a fairly rare occurrence I imagine, and a mistake of this type may also happen at the time of purchase. E.G. inaccurately cited terms or improper applications of rebates.

Shit happens, but above is not a normal occurrence and not a reason to bash leases. Do you know if you lease, then you can write off the vehicle, thereby effectively reducing your car payments by your tax rate? If you have a business paying for your car lease this becomes extremely advantageous, especially if the lease was crafted properly from the inception.

After buying cars for over 20+ years I realized that I was losing more on vehicle depreciation due to mileage and hassle of selling than I did to mileage overruns on leases. I change cars every 2 to 3 years, so now I just lease them, turn them in 3 years later with 45K miles and get a new one. Never stuck in a car again... for someone like me with car ADD, it makes perfect sense, especially when I write off the lease as business expense. When you can drive $100K cars for around $1,200 a month (or $800 effective) and a few K out of your pocket, it becomes far less than depreciation would have cost you on that vehicle if bought new - it really is a no-brainer for those who can take advantage.

That might be it, but speaking for myself the math has never worked out or made any sense in favor of leasing. Leasing doesn't build wealth and it is an eternal monthly payment threadmill. I guess the scheme works for guys that want to have nice, expensive and shiny new cars every 2-3 years in their driveway and if that is their main excuse then so be it. But pretending that leasing makes sense financially or enables you to build wealth, who are kidding?

Also leasing may make sense as business expense as it seems to be the case for you. Other than that I fail to see the advantages with hard numbers on paper.

99% of people have no business leasing cars and expensive ones at that.

[DarkgraphiteNYC]

Originally Posted by DirtyVegasMB

To the OP. So in the worst case scenario, you'll just end up having the mileage expense properly written off at the time of return, and possibly losing $48.00 (.02 x 2400)? Doesn't really sound like the end of the world scenario to me...

Not if you know WHY you are leasing. The example cited above is a fairly rare occurrence I imagine, and a mistake of this type may also happen at the time of purchase. E.G. inaccurately cited terms or improper applications of rebates.

Shit happens, but above is not a normal occurrence and not a reason to bash leases. Do you know if you lease, then you can write off the vehicle, thereby effectively reducing your car payments by your tax rate? If you have a business paying for your car lease this becomes extremely advantageous, especially if the lease was crafted properly from the inception.

After buying cars for over 20+ years I realized that I was losing more on vehicle depreciation due to mileage and hassle of selling than I did to mileage overruns on leases. I change cars every 2 to 3 years, so now I just lease them, turn them in 3 years later with 45K miles and get a new one. Never stuck in a car again... for someone like me with car ADD, it makes perfect sense, especially when I write off the lease as business expense. When you can drive $100K cars for around $1,200 a month (or $800 effective) and a few K out of your pocket, it becomes far less than depreciation would have cost you on that vehicle if bought new - it really is a no-brainer for those who can take advantage.

You can write off a purchased vehicle too

Personally, I've leased a few cars over the years and it has been a losing proposition for me. I am not the type of guy who needs to be in a new car every two years and I like not having to endlessly make car payments.

[bMm5w]

There's no wealth building in a highly depreciating asset such as a vehicle with high mileage. I don't do it for vanity, I do it because finance works better. But yes, I also get to drive fancy toys at a cost lower than owning, and the math still works, and you know what? I don't care how it looks - I LOVE IT.

[claykin]

Originally Posted by DarkgraphiteNYC

You can write off a purchased vehicle too

Personally, I've leased a few cars over the years and it has been a losing proposition for me. I am not the type of guy who needs to be in a new car every two years and I like not having to endlessly make car payments.

Sure you can write off (depreciate) a purchase but in many cases when you sell the car you'll be dealing with recapture.

Owning a depreciating asset is often not a smart move.

[claykin]

OP, what does your lease contract say? Mileage overage charge is printed on the lease contract. If it says 25 cents you should be able to pre-purchase miles now for 23 cents. Send BMWFS a copy of your lease contract.

Ask your leasing dealer finance manager for help to get this sorted Monday.

[530iDriver]

Originally Posted by claykin

Sure you can write off (depreciate) a purchase but in many cases when you sell the car you'll be dealing with recapture.

Owning a depreciating asset is often not a smart move.

And even worse paying for one and have nothing to show for at the end.

[mjr24]

I got this fixed.

I called back Friday and spoke to a supervisor who was able to get the 0.23 charged now. She claims the system normally doesn't allow it to be changed but it magically worked when she tried it.

Regardless, the customer service associate I spoke to originally Thursday was a jackass and simply lazy. I asked for a supervisor then and he claimed he had already talked to the supervisor about it and that nothing was going to change. I honestly think BMWFS tries to sneak M prices off on M550i owners (and owners of other M performance but not actual M models). I bet most pay it twice without thinking, too.

BMWFS is definitely a bit shady. Worst example of this was when I had my M6 GC lease from December 2014 to December 2016. When I leased that car, the normal penalty for M cars was 0.25 per mile but additional miles could be bought for 0.15 per mile before the lease. Apparently sometime during my lease period, BMWFS changed their policy and basically changed the price of the discount from 0.15/mile to 0.23 mile with no notice to anyone. I took a bath there because I was 30,000 miles over.....so I lost about $2,400 because they changed the rate in the middle of the lease and refused to give me the price it was at the beginning of the lease. I'm sure I wasn't the only person pissed off about this.

[claykin]

Originally Posted by mjr24

I got this fixed.

I called back Friday and spoke to a supervisor who was able to get the 0.23 charged now. She claims the system normally doesn't allow it to be changed but it magically worked when she tried it.

Regardless, the customer service associate I spoke to originally Thursday was a jackass and simply lazy. I asked for a supervisor then and he claimed he had already talked to the supervisor about it and that nothing was going to change. I honestly think BMWFS tries to sneak M prices off on M550i owners (and owners of other M performance but not actual M models). I bet most pay it twice without thinking, too.

BMWFS is definitely a bit shady. Worst example of this was when I had my M6 GC lease from December 2014 to December 2016. When I leased that car, the normal penalty for M cars was 0.25 per mile but additional miles could be bought for 0.15 per mile before the lease. Apparently sometime during my lease period, BMWFS changed their policy and basically changed the price of the discount from 0.15/mile to 0.23 mile with no notice to anyone. I took a bath there because I was 30,000 miles over.....so I lost about $2,400 because they changed the rate in the middle of the lease and refused to give me the price it was at the beginning of the lease. I'm sure I wasn't the only person pissed off about this.

If I can make a recommendation for your future leases.... Buy more miles up front. Far more economical than paying on the backend.

About the overage, some manufacturers don't allow you to buy discounted miles after.

[jjscsix]

Originally Posted by 530iDriver

More reasons why I dislike leasing. It is just a money grabbing scheme.

Kind of a silly remark. Leasing vs. buying is all about each situation. I’ve leased many cars, including my previous BMW. In every case I was happy with the results. Based on the resale hit on my current 540 and my desire to be out of the car in less than four years, I wish now I had leased. It would have cost me less money.

But again, every situation has to be analyzed. It works both ways.

[jjscsix]

Originally Posted by mjr24

I got this fixed.

I called back Friday and spoke to a supervisor who was able to get the 0.23 charged now. She claims the system normally doesn't allow it to be changed but it magically worked when she tried it.

Regardless, the customer service associate I spoke to originally Thursday was a jackass and simply lazy. I asked for a supervisor then and he claimed he had already talked to the supervisor about it and that nothing was going to change. I honestly think BMWFS tries to sneak M prices off on M550i owners (and owners of other M performance but not actual M models). I bet most pay it twice without thinking, too.

BMWFS is definitely a bit shady. Worst example of this was when I had my M6 GC lease from December 2014 to December 2016. When I leased that car, the normal penalty for M cars was 0.25 per mile but additional miles could be bought for 0.15 per mile before the lease. Apparently sometime during my lease period, BMWFS changed their policy and basically changed the price of the discount from 0.15/mile to 0.23 mile with no notice to anyone. I took a bath there because I was 30,000 miles over.....so I lost about $2,400 because they changed the rate in the middle of the lease and refused to give me the price it was at the beginning of the lease. I'm sure I wasn't the only person pissed off about this.

Every lease I have had said right in the contract what the overage was. I’d bet money yours did to. They cannot change what you have already signed a contract on. Must be more to this story.

[530iDriver]

Originally Posted by jjscsix

Kind of a silly remark. Leasing vs. buying is all about each situation. I've leased many cars, including my previous BMW. In every case I was happy with the results. Based on the resale hit on my current 540 and my desire to be out of the car in less than four years, I wish now I had leased. It would have cost me less money.

But again, every situation has to be analyzed. It works both ways.

That might be it and every person situation is different. Leasing is unfortunately the most expensive way to finance a car.

https://www.consumerreports.org/cro/...hing/index.htm

https://www.barrons.com/articles/why...ase-1488585027

[Pierre Louis]

I must say I've had nothing but good luck and good service from manufacturer financing including leases and from BMW. My latest buyout of a 3 year 18,000 mile lease went very very well. Essentially I was able to buy back my leased 5-series for a market price.

My past company lease deals were from Chevrolet where I was able to either buy out the lease and the car was worth $5K more on trade-in and release a Mercedes to a $1.00 end of loan buyback. The other new Mercedes rate was for an equivalent APR of 1.9% for 5 years (inflation at the time was higher).

YMMV

[Superjackson]

Hmm I thought it was common for dealers to forgive the overage if you purchased your next car from them. Anyway, it's good that you got it sorted out before 2020!

[LogicalApex]

Originally Posted by DirtyVegasMB

To the OP. So in the worst case scenario, you'll just end up having the mileage expense properly written off at the time of return, and possibly losing $48.00 (.02 x 2400)? Doesn't really sound like the end of the world scenario to me...



Not if you know WHY you are leasing. The example cited above is a fairly rare occurrence I imagine, and a mistake of this type may also happen at the time of purchase. E.G. inaccurately cited terms or improper applications of rebates.

Shit happens, but above is not a normal occurrence and not a reason to bash leases. Do you know if you lease, then you can write off the vehicle, thereby effectively reducing your car payments by your tax rate? If you have a business paying for your car lease this becomes extremely advantageous, especially if the lease was crafted properly from the inception.

After buying cars for over 20+ years I realized that I was losing more on vehicle depreciation due to mileage and hassle of selling than I did to mileage overruns on leases. I change cars every 2 to 3 years, so now I just lease them, turn them in 3 years later with 45K miles and get a new one. Never stuck in a car again... for someone like me with car ADD, it makes perfect sense, especially when I write off the lease as business expense. When you can drive $100K cars for around $1,200 a month (or $800 effective) and a few K out of your pocket, it becomes far less than depreciation would have cost you on that vehicle if bought new - it really is a no-brainer for those who can take advantage.

You can depreciate the owned car asset just like any other business equipment if you're looking at this from a business perspective. You can also properly factor in depreciation as well since that's a reduction in the asset value and a "charge". But leasing makes the "paperwork" easier I am sure.

But make no mistakes... There are no "free lunches" to be had. The job of a lease is to ensure you pay depreciation + financing costs during the time you're "using" the car. The depreciated cost of the car mileage and time wise shouldn't vary that much unless the manufacturer financing arm has erred in their depreciation calculation (which happens, but is usually on new models or refreshes. for instance, if the new model is super unreliable and depreciation is steeper as a result). Generally, they are very good at pricing this (since they have reams of data to compare to that you don't) and no one is losing money so you can expect that leasing is generally more expensive than traditional financing or ownership.

I personally steer very clear of leasing as there is a lot more areas to inflate the deal in their favor. Traditional financing I'm focused on out the door pricing and interest rates whereas leasing throws in money factors, residuals, and security deposits among other things. And you lose some leverage on shopping around as leasing requires manufacturer financing arms. Especially since trading in a low mileage car that can be CPO'd puts you in the driver's seat negotiation wise (all cars traded in within lease parameters fit CPO guidelines or you're forced to beg for concessions as in this thread). Negotiating lowest possible out the door price then negotiating up the highest possible trade in value will get you the best value for your money...

Each situation is unique, but I'd imagine it is rare to come out ahead leasing and for many leasing is a way to get into a "better" car for the same money. Especially as you see the new travesty where leasing has now made it to used cars. You can lease a CPO car from a dealer... That's just...

[jjscsix]

Originally Posted by 530iDriver

That might be it and every person situation is different. Leasing is unfortunately the most expensive way to finance a car.

https://www.consumerreports.org/cro/...hing/index.htm

https://www.barrons.com/articles/why...ase-1488585027

But financing is just one aspect of total cost of ownership. The biggest single factor in analyzing buy vs lease is how long one plans to keep the car. That is the key for me. For many, many years two years was the norm for me.

When manufacturers like BMW subsidize the residual on 2-3 year leases, the numbers often work for leasing. Also, in Texas there are some very interesting tax laws....and tax credits are often available. That can make a big difference in the lease payment.

[Pierre Louis]

The one disadvantage to me in my buyout of the lease was double jeopardy on the state tax here in Georgia. I had to prepay the tax for the lease period and then pay a similar tax on the car when I became the "new owner."

[mjr24]

Originally Posted by jjscsix

Every lease I have had said right in the contract what the overage was. I’d bet money yours did to. They cannot change what you have already signed a contract on. Must be more to this story.

Your comment makes no sense. Of course every contract has what the penalty is. However, that has no relation to what the discounted rate will be.