Help with new lease

On Sept.29, I placed my order for a 2006 530i, 36month lease @ 4.50% (lease through BMW Financial, yes I know the rate is high, but this is the best we can get in Canada!). I think I got a pretty good deal at 5.4% off MSRP and 55% residual. I know I did not push for the best deal but I was fair with the salesman and understand this is a business and like any other business, they have to make money. All I asked for was a fair deal and on that day, everyone went home happy. Also, I am trading in my 2003 Audi A4 1.8T Quattro, and I was very fair in taking the wholesale price of $25,000 CAD, with the range being $24,000 to $26,000 wholesale and $28,000 to $30,000 retail. The car is in good condition but not mint, so I did not push for more on the trade. Part of the deal is that I turn my car in by mid-Oct, eventhough the salesman was pretty sure I won't see my new car until around Christmas. No problem...

Last week, my salesman calls me to confirm I will be bringing in the car. Then he says, by the way, BMW Finance has changed the 36 month lease rate to 5.50%. He said since I will not be able to take deliver of the car before Nov.29, I will have to pay the higher lease rate. However, he told me not to worry about it since I already got such a good deal on the car. It will only add up to ~$50more/month.

He admits he made a mistake because he promised me at the time of signing that my lease rate is protected and if rates go down I will get the better rate but if rates go up I will not do any worse than 4.50%. He said he is an honest person and he admits his mistakes. However, there is nothing he can do. He said maybe he can talk to his manager and they can meet me half way on the additional costs.

Now, I don't know what to do. Should I just cancel the whole deal? Should I pressure him and his dealership to honour the deal? How can they just change my deal after it has been signed? It is not my fault that the car is not going to arrive before Nov29. Why do I have to pay the consequences. I am very disappointed at the moment and getting more and more frustrated.

Any advice is greatly appreciated!

Reply » Help with new lease

I would walk in a heartbeat.

Reply » Help with new lease

Quote:

I don't know how these things work in Canada- maybe try asking this question in the "Ask a dealer" forum.

Reply » Help with new lease

Well, they said they would meet you half-way...that's a good start but perhaps now is the time to push them for something better.

Lay out how much extra it is going to cost you over the period of the lease going from 4.5% to 5.5% and lets call the difference X. Now using that number, ask thm how they plan to compensate you for their mistake (regardless if it was in their control or not).
You need to establish with them what they mean by "meet me half way on the additional costs." Once you understand this, negotiate from that point back towards your original deal. If they won't budge any further that this "half-way" stuff, then you can consider walking and see if that makes them do better than their "half-way" deal.

Reply » Help with new lease

Thanks for all the comments. The additional costs over three years will be approx. $2,000 CAD.

More than anything I think that I am angry that this situation has even arisen. I signed the deal and gave them my $2,000 deposit. That should be the end of it. How can they come back and change the terms? What if I found a better deal elsewhere after I signed? Will they let me cancel the deal and give me back my deposit? I don't think so...

I don't know where to go next. Do I put pressure on the salesman, the dealership, or BMW Finance? I don't want to make life difficult for the salesman, especially if he can't do anything; I'm not sure how far the dealership will go as they seem to be set on making money, whether they deserve it or not. I know in my business, if I make a mistake I pay for it. I believe that's the cost of doing business; I'm not sure I want to fight BMW Finance right now, as I'm afraid of this potential outcome: they will appear indifferent and will not help, I will get frustrated and refuse to buy a BMW out of principle. In that scenario I am the one that loses. (That's why I went from BMW to Audi in the first place and after 2 1/2 years, miss driving a BMW.)

My last option is to get out of the deal entirely. Start fresh on a 550i deal since the lease rate on the 530i and the 550i is now the same. The only reason I went with a 530i was because the lease rate was 4.50% vs. 6.95% on the 550i.

What should I do??

Reply » Help with new lease

Here is the deal. You signed something with the dealer. BMWFS still has to approve it and BMWFS can reject it any time they like. When your dealer submits the paperwork to BMWFS I can almost guarantee you that BMWFS will reject the contract because the terms aren't correct. Your dealer screwed up by sticking his neck and saying what he did but his arms are basically tied. It is now up to him to decide how to best handle this situation with you to compensate you the best he can but for sure, he doesn't want to take too much less money all though he probably deserves to. It all depends on how badly they want the sale from you.

Case in point: I had my deal worked out, did my euro delivery, came back, and a few weeks before the car arrives in the US, they want to change my money factor! Why? Well, my dealer did mess up but BMWFS rejected the original contract so I had to agree to it. It doesn't matter that I signed and got the numbers I got many, many weeks before. I was duly compensated by my dealership so it was no big deal in the end.

I don't know the laws in Canada about deposits on cars. In California, they are what is called non-binding. Basically, a car deposit is something you can get back no matter what in the state of California. Power to the consumer!

Your only course of action is to work with the salesman/dealer...BMWFS will not change their rates for you. If you don't like what they offer you, then get your money back (I assume that you can), and walk. Do you have an alternative dealership you can go to?

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