BMW Select Finance query - Z4M
Discussion
Have been keeping an eye on Z4M coupes for a while, and like several others on the forum, think they are starting to look good value at £30k.
I test drove one this afternoon (very impressed tbh), and whilst the service at the dealer was good, I was surprised at how unwilling they were to negotiate for a deal.
Could someone tell me - is the Select Finance (PCP) completely standard across all dealerships?. I was told that the 5.95% flat rate (I would guess 12% APR approx) was fixed with no room to negotiate at all. In my experience this seems strange, I expected some movement from their first offer.
As a result, I left sooner than I expected to, and wondering whether all BMW dealers enforce this policy. I was quoted £500 per month over 3 years, with £4K deposit on a £30k car. The MGFV was a tad over £15K.
To those in the know (or those who have made similar purchases) is this as bad a deal as I thought? Am I simply being cheeky expecting some sort of negotioation on their first offer? Any recommendations for places to get a better deal - their valaution of my p/x was approx £1000 below what was quoted at another garage too !
Thanks
I test drove one this afternoon (very impressed tbh), and whilst the service at the dealer was good, I was surprised at how unwilling they were to negotiate for a deal.
Could someone tell me - is the Select Finance (PCP) completely standard across all dealerships?. I was told that the 5.95% flat rate (I would guess 12% APR approx) was fixed with no room to negotiate at all. In my experience this seems strange, I expected some movement from their first offer.
As a result, I left sooner than I expected to, and wondering whether all BMW dealers enforce this policy. I was quoted £500 per month over 3 years, with £4K deposit on a £30k car. The MGFV was a tad over £15K.
To those in the know (or those who have made similar purchases) is this as bad a deal as I thought? Am I simply being cheeky expecting some sort of negotioation on their first offer? Any recommendations for places to get a better deal - their valaution of my p/x was approx £1000 below what was quoted at another garage too !
Thanks
taffyracer said:
BMW select is the worse way to finance a car, balanced payments is without the best
What a ridiculous statement to make. Both products have pros and cons and the best option for you is dependant a several factors. Personally I am not a big fan of PCPs, but it does give you fixed costs so you know where you stand in advance. In my experience dealer finance is always negotiable, if not then look else where.
1 said:
taffyracer said:
BMW select is the worse way to finance a car, balanced payments is without the best
What a ridiculous statement to make. Both products have pros and cons and the best option for you is dependant a several factors. Personally I am not a big fan of PCPs, but it does give you fixed costs so you know where you stand in advance. In my experience dealer finance is always negotiable, if not then look else where.
Philrose said:
The last time I used BMW finance they were prepared to match the best offer I could find elsewhere.
yep they were prepared to match the lowest rate I could find for my Z4M I bought last August. A bit grumpy though! Had the oft repeated yet classic line 'but you don't work for nothing do you?' Anyway happened to mention the finance to my bank and they have even better rates they don't advertise. Moral of the story is negotiate hard.taffyracer said:
1 said:
taffyracer said:
BMW select is the worse way to finance a car, balanced payments is without the best
What a ridiculous statement to make. Both products have pros and cons and the best option for you is dependant a several factors. Personally I am not a big fan of PCPs, but it does give you fixed costs so you know where you stand in advance. In my experience dealer finance is always negotiable, if not then look else where.
Of course it is best to shop around and if you knew anything about finance you would know that if you are looking at a PCP then the APR is not always the most significant factor in judging if it is the best deal for you.
PCP is front loaded, tell me 1 reason why it is better than paying on balanced payments over the same period? When you have 2 products that offer the same balloon, pay off the same amount of capital over the same period, doesn't penalise you to change early and is nearly 1% cheaper than the best BMW will offer meaning substantially less monthly payments, I would say that it would be a no brainer which one is better. The ONLY benefit I can see from select is guaranteed RV but then they are set so conservatively that i don't see it as offering anything worthhile anyway.
Edited by taffyracer on Sunday 3rd February 16:11
taffyracer said:
PCP is front loaded, tell me 1 reason why it is better than paying on balanced payments over the same period? When you have 2 products that offer the same balloon, pay off the same amount of capital over the same period, doesn't penalise you to change early and is nearly 1% cheaper than the best BMW will offer meaning substantially less monthly payments, I would say that it would be a no brainer which one is better. The ONLY benefit I can see from select is guaranteed RV but then they are set so conservatively that i don't see it as offering anything worthhile anyway.
I have never said one product was better than another. My point is that it is impossible to state that one product is better than another in every situation. You seem to be sold on balanced payments, good for you, it is however not the best option for everyone.Edited by taffyracer on Sunday 3rd February 16:11
Why is that so difficult to grasp???
What I find difficult to grasp is why you think that paying more for the same thing can be beneficial, I wasn't commenting on PCP's per se, they have theur place, not for me but I can see why some would choose it, I was referring specifically to BMW Select being about the worse way to finance a car and I stand by that, you can get PCP's elsewhere that will offer the same capital repayment over the same period with the same guaranteed RV for ALOT less / month, that is my point, BMW finance works off a base rate that is 0.25% more than the banks and other finace houses use, so it's higher to start with, even with the best negotiation I doubt they'll give you less than 2% over their FHBR, 3% is normal, 2.5% if you push 2% if they are dead keen, meaning at their very best they will have a rate of 7.75%, which is 0.5% more than you can get elsewhere, what is it that you find so difficult to grasp with this?
Edited by taffyracer on Sunday 3rd February 16:41
taffyracer said:
What I find difficult to grasp is why you think that paying more for the same thing can be beneficial
WTF have you got that from??? Either way I dont really care, you are now so far from your initial statement it is all becoming irrelevant and is detracting from the original thread.
Why repost then if it's of no interest, you haven't provided 1 reason why select could be beneficial, not 1, if you disagree with my statement so strongly then please give me an example. The fact is BMW Select is not a unique product, you can get an identical PCP deal elsewhere if that's what you want and it will be ALOT cheaper, I stand by my comments "BMW select is the worst way to finance a car"
I wouldn't say that BMW Select is the worst way to fund a car but it does depend on individual circumstances. Often the PCP deal with BMW is better than others because they somethimes set a higher RV than competitors due to them being a captive finance house. I would suggest if the deal isn't to your liking you try other BMW dealers as they may be prepared to negotiate on rate. Some Business Managers within dealerships are set restrictions on the rates they can offer, this is usually the case in large dealer groups whereas the smaller dealers may have more freedom. It is worth asking around but then you also have to consider that the dealers charging you a higher APR will potentially do you a better deal on the price of the car as they are making their money on the finance.
Hmm, it does sound like my experience was somewhat unusual - in that the saleman was unwilling to negotiate on p/x price, price of the car, and the price of finance. What sort of movement can I expect in general on a used Z4M?
I know each circumstance is different, but as a benchmark I received £1500 ish discount (10% approx) on an approved Audi for a straight cash purchase last time round. (Incidentally, this is the car I was trying to p/x).
I guess I'll move on and try others - seems there are plenty around in the AUC network at the moment.
I know each circumstance is different, but as a benchmark I received £1500 ish discount (10% approx) on an approved Audi for a straight cash purchase last time round. (Incidentally, this is the car I was trying to p/x).
I guess I'll move on and try others - seems there are plenty around in the AUC network at the moment.
I'd expect there to be a fair amount of movement, but you need to shop about, I just sold mine for 31.5k but in actual fact it was only worth 27k, so if you approached this dealer I doubt they'd move either, you need to find a car that has been bought cheap to allow the dealer to have movement in the car and there should be plenty about. Given how hard it was for me to get the deal I currently have on my M3 i'd say that 32k should be the absolute max for a low mileage/high spec 2007 car, 30k max for anything approaching 10k or a late 2006 car
I know it's a few months ago that the original question was asked but I would add something that I haven't seen mentioned above.
Even though I've never taken on any form of new debt to buy a car, something about the type of financing being discussed here that is worth a mention is the minimum guaranteed final value and the implications of the eventual valuation differing from this.
If you had financed 2, 3 or 4 years ago and were coming to the end now, in the current environment in which used cars seem to have undergone a drop in value recently, you could be coming off your lease contract in a situation in which the car is worth considerably less than the MGFV. In which case you surrender the car and some of the depreciation is borne by BMW Finance. In this case even if the implied interest rate is higher than other forms of finance, it is conceivable that the cost - when taking into account total costs of ownership - is lower. If the used car environment was such that the car ended up more valuable than expected, you as lessee keep the benefit of the better residual value (just as you would under any other finance regime) by the fact you can buy at the pre-agreed lower price.
For those with an interest in financial maths you could consider yourself to have a put option on the car at the MGFV. Options have value.
So the circumstance when leasing might conceivably work better is one in which the MGFV is set higher than the eventual value turns out to be.
Another reason it might be the preferred option is when your finances are being assessed for other purposes such as a mortgage. "How much other debt do you have outstanding" is a question that will be asked, and the answer in the leasing case will be lower than in the tradititional case where you finance the entirety of the car's value ex deposit. This could make you eligible to get a larger mortgage.
By the way I don't work for BMW and never have. I'm just pointing out a few considerations.
Even though I've never taken on any form of new debt to buy a car, something about the type of financing being discussed here that is worth a mention is the minimum guaranteed final value and the implications of the eventual valuation differing from this.
If you had financed 2, 3 or 4 years ago and were coming to the end now, in the current environment in which used cars seem to have undergone a drop in value recently, you could be coming off your lease contract in a situation in which the car is worth considerably less than the MGFV. In which case you surrender the car and some of the depreciation is borne by BMW Finance. In this case even if the implied interest rate is higher than other forms of finance, it is conceivable that the cost - when taking into account total costs of ownership - is lower. If the used car environment was such that the car ended up more valuable than expected, you as lessee keep the benefit of the better residual value (just as you would under any other finance regime) by the fact you can buy at the pre-agreed lower price.
For those with an interest in financial maths you could consider yourself to have a put option on the car at the MGFV. Options have value.
So the circumstance when leasing might conceivably work better is one in which the MGFV is set higher than the eventual value turns out to be.
Another reason it might be the preferred option is when your finances are being assessed for other purposes such as a mortgage. "How much other debt do you have outstanding" is a question that will be asked, and the answer in the leasing case will be lower than in the tradititional case where you finance the entirety of the car's value ex deposit. This could make you eligible to get a larger mortgage.
By the way I don't work for BMW and never have. I'm just pointing out a few considerations.
joelgti said:
Hmm, it does sound like my experience was somewhat unusual - in that the saleman was unwilling to negotiate on p/x price, price of the car, and the price of finance. What sort of movement can I expect in general on a used Z4M?
I know each circumstance is different, but as a benchmark I received £1500 ish discount (10% approx) on an approved Audi for a straight cash purchase last time round. (Incidentally, this is the car I was trying to p/x).
I guess I'll move on and try others - seems there are plenty around in the AUC network at the moment.
having bought 2 in the last six months, you'll struggle to get over £1k off the screen price... trust me i haggled hard both times, i did slightly better on the first one, but the second one was so cheap (sreen price sub £30k) they wouldn't budge! unless you can demonstrate another dealer selling one the same spec for less you'll get nothing more that a guesture IME I know each circumstance is different, but as a benchmark I received £1500 ish discount (10% approx) on an approved Audi for a straight cash purchase last time round. (Incidentally, this is the car I was trying to p/x).
I guess I'll move on and try others - seems there are plenty around in the AUC network at the moment.
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