What you need to know about BMW SELECT Financing! (North America) (MA Car Broker) (MA Car Broker)

In this video, we discuss what a BMW Select contract is, and how your payment is calculated using the program.

First of all i’m in no way affiliated with bmw i’m just that guy that loves bmws has done this a couple times not my first rodeo and my experience with bmw select is that bmw loves to make dreams come true yeah i said it bmw loves to make dreams come true and what the dealer likes to do is oftentimes makes those dreams into nightmares using bmw programs that are

In place i want to talk about bmw select financing you might notice you might have noticed the select option the last time that you were negotiating working figures with bmw dealership they have an option called select financing it’s like a really fancy term for what i’m gonna be describing next this this fancy term that i’m referring to bmw select is is actually

It’s a really really good program and it’s helped out a few people that i know personally get into their dream cars if you’re trying to compare bmw select financing with bmw leasing if you can always always stick with leasing now if the payment is too high on the lease or let’s say you might be rolling in a ton of negative equity and you’re considering bmw select

This video is worthwhile to watch because i’m gonna be talking about how bmw select works so that you completely understand what you’re actually doing and what you’re getting yourself into so that you can make an informed decision about it now take for example your regular least your traditional lease with bmw where you’re leasing out the car for 3 years say and

You’re gonna go and drop off the car at the dealership at the end of your lease and all you’re gonna be responsible for is if you know you damaged the car – you know repair the damage or anything like that or pay for the damage if you put on more miles than you were contracted for and your disposition fee and that’s that’s sort of your typical closed-ended lease

With bmw select imagine a regular lease majan a four year or a five year lease and at the end you can’t drop off the car well you’re responsible for is a big lump sum payment sort of comparable to traditional lease where you have your buyout price you have no option of turning in the car at the end what you have to do is you’ve got this big lump sum purchase price

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That you’re actually responsible for you have this big lump sum purchase price where you have to either buy the car at the end refinance the car at the end or figure out exactly what your car is worth trade it in and hope that there is no negative balance or in this case what dealers like to say negative equity when you’re at the end of your bmw select finance term

When i said earlier that bmw likes to make dreams come true and dealers like to make those dreams into nightmares the reason why i say that is that bmw select financing is so flexible bmw select will sometimes offer 0.9% apr for that term to the dealer only for the dealer to mark it up to like three point nine percent they could turn basically like let’s say for

Example on an x5 like a $75,000 side they could turn what would be like a seven hundred and fifty dollar bmw select payment a finance payment they could turn it into like a thousand dollar select finance payment just by adjusting what they buy the interest rate for now bmw select offers four or five year select financing terms depending on you know which program

Is better because of what they what they do is just like the lease they have their residuals for four years and five years and what you’re doing is is calculating what depreciation you’re going to be paying for for the four years or five years what your buyout price is and you’re only paying payments on the depreciation for the four or five years plus interest

And you’ve got your buyout price the end with no option of turning in your car in certain circumstances leasing may actually be better than doing the select finance however select financing when you’re trying to do like i don’t know an eighty or a hundred thousand dollar bmw select financing actually may make everything just work and look a lot better however if

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You’re a high mileage driver or if you’re prone to accidents you could find yourself in a bit of trouble at the end of the four or five years because put it this way if the car isn’t in mint condition if it’s got an accident report you’ve got it you put on a ton of miles that all counts against the resale value of the car which you’re hoping to keep very high when

You’re about to approach the end of your select financing term so that you know you can sort of clear the balance on your loan at you know your balloon payment you can sort of get somewhere close to it chances are if you’re not putting a ton of money down on this select financing or not making extra payments on your loan cases are that you’re gonna be upside down

On this loan and that’s not to say that you wouldn’t be upside down on a traditional financing term just like a regular sixty month financing term chances are if you didn’t put enough money down you would probably be upside down on a regular term however it’s almost the guarantee that you’re gonna be upside down on a bmw select if you know you’re not cautious and

You’re not looking out for the interest rate how bmw select stacks up against other credit unions so some credit unions offer a same program call the payment saver finance term which basically does the same thing it takes a pre calculated residual amount for the car that you’re looking at and you’re just paying for the depreciation and you’re responsible for a balloon

Payment at the end however the only variation in between you know a credit unions payment saver term and bmw selects program is the interest rate the most ideal situation is is if you’re a part of a credit unit or you can find yourself on their website and join what you want to do is is figure out exactly what that credit is offering you on the same terms what

Sort of interest rate and what their monthly payment is looking like take that information take that and take it to your bmw dealership just to guarantee that they’re not going to try to hike up your interest rate on the bmw select term because bmw likes to give the dealership greater flexibility when calculating a select term they’re oftentimes finding themselves

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Marking up interest rates from the very lowest that bmw offers you know to a maximum potential this select financing term is a big moneymaker for bmw dealerships because it’s very very hard for somebody that is calculating a select financier to see exactly how the interest unfolds the amortization how it unfolds in this term over four or five years we want to do

Is is shop around to different credit unions and see what their payment saver programs look like on the car that you’re looking for take that information and take it to bmw it may not always be a situation where that dealership will match the rate however you’ll have a greater peace of mind knowing that the program that you’re looking to be a part of you’re taking

Advantage of the markets lowest possible rate in term as far as residual so that you can make the best decision possible when purchasing this car that you’re looking at i do want to commend bmw on the program that it offers however i cannot say that i can commend bmw dealerships on how they choose to help their customers with this program you definitely got to

Be cognizant about what your dealership is doing when they take bmws program and structuring it around your needs so definitely look out for that i hope this video helps if it did help and you’d like to see more videos just like this please hit the subscribe button if you’re seeing this on facebook like it maybe share it if i’m lucky and if you’re seeing this on

Instagram feels for you to just doubletap the heck out of your screen thank you so much for watching guys we’ll see you next time

Transcribed from video
What you need to know about BMW SELECT Financing! (North America) (MA Car Broker) (MA Car Broker) By Anxiety Explored