Lease vs Owner's Choice

[merbella]

Can anyone explain the difference between and pros and cons?
I am looking at a 24 month lease (vs owners choice)
I know there are some Atlanta members here. I am on an extended test drive now and trying to work end of year deal. Contacted a couple of dealers and asking for email information....
Any advice appreciated!

 

[websterize]

If you have at least a $7,500 tax liability, the OC+Flex with the full $7,500 add-on is worth exploring.

You'll pay slightly more interest over the term, and you have to pay back the float amount to BMWFS by the end of it. The Flex is applied as a residual value % point increase. For example,

Approximate December residuals
24yr/12k= 62% RV
30/12k= 57%
36/12K= 52%

24-month term is the best term. At 24/10k it's probably 63%. You can call BMWFS to confirm all the RVs.

So for this deal:

24/12k
$50350 (MSRP)
x.62 RV
31217 + 7500 Flex = 38717

38717/50350 = 76.8% RV. A 77% RV is extraordinary. Download Leasematic on your phone and play around with the figures. This is not a one-size-fits all deal. Everyone has to run his numbers on the various financing options and see what makes sense. Good luck, and let us know how it goes!

 

[AlexAtlantaEV]

Go to the dealer and they will give you a personal quote for all of them to weigh. I personally would go with OC or OC + Flex just for the big fat tax rebates especially in Georgia, and then of course as websterize says if your tax liability in general over $7,500 the OC Flex is worth a gander.

 

[i3atl]

When comparing, the three key aspects in GA are that:

1) You pay sales tax on the purchase price of the car (vs the total of your lease payments, as is the case in CA and other states) whether you do OC/OCwF or lease - so the GA tax "cost" is similar. TAVT will be slightly lower on a lease, since the lease credit (item #2) reduces the taxable price of the car. The additional TAVT you pay with OC/OCwF is typically negated by the acquisition fee on a lease (item #4).
2) On a lease, you get the $7500 federal tax credit up front. Assuming you're eligible to claim the full amount, OC/OCwF provides for the same $7500 incentive, but you claim it when you file your taxes. Some people will not be eligible for the full amount, which must be claimed in one tax year, so leasing is a way to get around that.
3) When you trade the car in down the road, with a lease in GA you don't get any tax benefit based on the value of the car. If you "own" the car (via OC/OCwF), then you won't pay title tax on the trade-in amount. If we assume a tax rate of 7%, and a market value of $30K for the i3 after 2 years, that's $2100 in tax savings at trade in. In addition, if you decide to purchase the car at the end of the term, in GA you will have to pay TAVT again on a leased car, since it is changing owners. With OC/OCwF, you do not have to pay TAVT again in this situation because you already own the car.
4) Leases have a $995 acquisition fee, Owner's Choice programs do not.

Number 3 is the biggest remaining advantage for Owner's Choice options in Georgia. Even without that, the payments between the two options should be very similar.

***Edited for 2015 changes***

 

[merbella]

Thank you for the clarification