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We are in the market for a Mercedes ML 350 or a BMW X3. We are trying to decide whether to lease a new one versus buying a 2-3 year old one. Any thoughts on either of these vehicles as well as which option is better would be appreciated. If we decide to lease, what is the best approach to take when we visit the dealer? Should we just walk in and tell them we are interested in purchasing a new vehicle and then later negotiate lease terms versus telling them up front what we want to do. What are the important points to negotiate? thanks in advance.
BMW has a lease program on new vehicles that is not your normal lease. At the end of the term you actually OWN the vehicle. They have MANY different options. I'd stick w/ BMW over MB right now. Friends that have had MB's have all sold them and gone to BMW. MB dropped their full maint. program a few years ago whereas BMW still has it. Another friend also had issues w/ the paint on her MB and found out recently that it was a known problem. She had been in a minor accident and they could not get the paint to match and even the original paint that was not touched had problems w/ a wavy effect to it.
Look at the used ones and the new ones together and see which one best suits your family. Sometimes the used ones may have way too many miles on it to make it not worthwhile. With BMW still covering all maint even on a lease you know the car is being taken care of. Check out to see if they have any program or demo cars available. They will typically have lower miles than lease returns.
Good questions. Ther are plenty of on-line calculators that can help you address these issues. Try SmartMoney.com, Yahoo Finance, or some of the others.
Good Luck and if we pass in traffic, don't forget to wave!
Generally speaking, according to my accountant, without a business use of a leased vehicle and possible tax write-offs, a lease is an expensive way to acquire a vehicle. At the end of the lease, you've got no equity and no vehicle, with possible back-end charges that can make the term of use very expensive.
Don't be fooled into a "lease" with a $1 or 0 buy-out at the end of the lease. You're still buying the car overall, the dealer must recover the cost of the car and his profit on the sale of the vehicle. He cannot give you a lease, which historically "pays" only for the portion of the service life of the vehicle you use during the term of the lease ... and then has a used vehicle to sell to capture the balance of the value of the car. If the dealer contracts to lease the car with a $1 buy-out, then he's simply arranged to recover all the cost in the initial "lease" contract. A more realistic lease allows you the option to buy at a specified price at the end of the term; you get to determine if the car is a good buy for your at that time.
On your choice of vehicles, I'd suggest to you that the ML series MB's have been very problematic in several areas, and have not been very reliable vehicles. They're quite expensive to keep on the road once the warranty runs out, because items that MB replaces under warranty still have a limited and fragile service life and you'll be paying for them out of pocket when they fail again.
The BMW's are better, but ..... IMO .... not a great vehicle, either.
If you're buying this for a vanity vehicle, then so be it ... enjoy!
If you're buying this for utility service as a primary transportation vehicle, then I hope you've looked at the entire range of the market offerings today.
There's a lot of quality AWD cars/station wagons that may just meet your actual needs and be less expensive to own and operate, and be more durable, reliable, and safer to drive. Check out CR's auto annual issue and their evaluations over the last year or so. Also, you can gooogle road test reports for the various vehicles and get owner reports as well as in-the-trade reports on the cars ... don't forget to check NHTSA listings for crash worthiness. And, check with your insurance agent for the category rating on a given vehicle ... that's pretty revealing, too ... since those numbers get refined by actual insurance industry experience.
Keep in mind that a new purchase takes the full hit on the initial depreciation of a car ... while a 2-3 year old off-lease vehicle has already lost that value. Saves you money if you can find a suitable used vehicle on acquisition, insurance, licensing, sales tax and other fees.
Every lease agreement you see advertised always has an "upfront cost" component. Like $2500 due at signing or the like. I think if you are self employed or using it as a company car, it is easier to write off a lease, which is why the leases are popular with some.
I never see a good reason to lease a vehicle. Purchase what you can and CAN AFFORD is a much better way to go. Once you pay it off, it is yours, period. I just do not see a point in paying for something and then not being able to keep it/own it.
Many people try to keep up with the Joneses and lease cars that they simply do not need and cannot afford.
Thanks so much for all the responses. We had not heard about the problems with the Mercedes SUV's. Definitely will take this into account in our decision. Does anyone know if this has been addressed in the newer editions (perhaps one reason to lease an 07 rather than buy an 05 if we are going to lease).
Also still trying to determine how I should approach the dealer to negotiate for a lease. Thanks,
Go visit the BMW dealership and test drive their SUV's then talk to the salesperson about the different options available for financing. No need to say, "I am only interested in a lease". They can lay out all of the finance options for you to compare them side by side and see which is the best fit for you. I'm not a fan of leases for personal vehicles at all - I'd never lease one myself and the people that I do know that have leased a vehicle have ended up paying more in the end and came out behind. But like I said earlier BMW has some different options that are not your normal "lease".
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