If you have the cash, pay for it. In theory, you should invest the cash in something that produces higher return that the interest you are paying if you finance the car, but this requires the discipline.

I have tried this a few times and have kept my cash, but in the end I end up spending it and still have car payments, I do not have the discipline, so if I have the cash I will pay for it the next time.

 

Most cars ( ex Ferrari etc) depreciate at various rates over the general ownership life , 3-5 years, I would bet that you could invest the difference and be $$ ahead vs a lump sum payment. As previously stated always look to BMW for cheap money. IE at 2.9 % the cost to borrow is very very insignificant and leaves serious upsides for "your" money to be invested elsewhere for far greater returns

Cheers

 

Exactly... Cash so he will drive his car, not a car property of BMW NA .

 

It's cost of money. If you can invest the balance and make more than the interest you paying for the car then don't pay it. If in the US then you shoudn't pay more that 7% interest. I am sure you can make more than 7% with the balance.

 

Who is lending money on NEW cars at 2.9%

 

If you have got it then CASH is the only way, in the UK there is as much national debt as national earnings. I always ensured that I ACTUALLY owned the car that I was driving why buy new for the sake of loosing all that money in the first two years.

My brother took out a lease on a 520d Msport and after 24 X ?600 payments he is handing it back after paying out almost ?15k, he has just paid the depreciation out for some lucky person to pick it up with the car not even covered 25k so virtually brand new....guess what where did I pick up mine which had covered only 56k just short of 6 months for ?16k!!

Not bitter or twisted but sometimes I worry about some of my colleagues who are riddled with debt and with no way out...

 

If you have good credit then consider it. If you have to establish credit then put a sizeable amount down to help you do this. If you have money to burn then don't worry about it but if you just got your inheritance then I would put some on the car and save some on the side. If you get a good interest rate on the car loan and put half down then take your other half and put it in a high yielding cd for 6 months at a clip. This way you beat them at the interest because you are making it back on the cd. This way you have money put away for an emergency or some things you may want down the road. Just my 2 cents.

 

Every new car maker including BMW, every month the rates are adjusted to move inventory which may be building or they need to make room for new models. I have a 2.9% loan from BMW. I usually pay cash but this was a no brainer.

Cheers

 

Just as a personal matter, I always prefer to have someone else own my depreciating asset (and bearing the risk). The entire concept of a lease is just BMW hedging the risk of depreciation. As for the prior comment about "ownership by BMW NA," who cares? Does anyone know whether you leased or bought the car? Can BMW take the car back if you make all of the payments? No.

I would rather have my cash in appreciating property.

I agree with all of the prior posters. This is a decision on the "cheapest" money. I would not put out the cash because I would then bear the risk of depreciation, and I would need to sell the car myself when I am done. A lease is nice and clean. You could also finance a purchase as well if you plan to keep the car for a long time. I agree with the others who have stated that the subsidized interest rates by BMW make the financing issue attractive.

Of course, if there is "ego" involved, I can understand the desire to "own" the car so one can say that they "own" it.

 

if you're planning on keeping the car for a long time, then why not pay? but if you like to change your car at least every 2 years... I'd say nope!!!!