Can You Trade In A Leased BMW To Another Dealership?

Are you nearing the end of your BMW lease and considering your options? You may be wondering, can I trade in my leased BMW to another non-BMW dealership? This is a common question for those looking to leverage the equity in their lease into a new car. In this comprehensive guide, we’ll cover BMW’s policy, tips for maximizing your trade-in value, when it financially makes sense, and potential downsides to be aware of.

BMW’s Stance on Lease Buyouts

First, what does BMW financial services specifically say about lease buyouts from other dealers? According to BMW, they prohibit acceptance of lease payoff payments from non-BMW dealers. This means you cannot directly trade in or sell your leased BMW to just any dealership if you want to buyout your lease.

However, there are documented reports online of people having success trading in their BMW lease to a dealership associated with a BMW dealership. For example, dealerships under the same parent auto group that includes a BMW store in their lineup. So there may be some wiggle room if they share relations on the back-end.

Checking Your BMW Lease Buyout Terms

Before considering trading in your BMW lease, you need to carefully review your lease contract and check the following:

Residual Value – The lease buyout amount BMW sets at the end of your term
Purchase Option Fee – Extra fee sometimes required to buyout a lease
Sales Tax – Tax calculated based on your state/local laws
Registration Fees – Fees to transfer ownership and registration

Add up all these lease buyout fees and compare it to any offers you get from other dealerships looking to acquire your BMW. This will tell you your potential profit margin, if any, for essentially selling your leased BMW to another dealer.

Selling to Another Dealer Group

If the other dealership making an offer for your leased BMW is connected to a BMW store, they may be able to arrange a lease buyout by sending a check from that BMW dealership to pay it off. There are examples of this approach working for some BMW owners, with the process documented on BMW enthusiast forums.

However, if the dealer group has no BMW dealer in their lineup, it adds risk and uncertainty to the process. BMW financial services may reject payment coming from a source with no BMW affiliation or recourse. So you need the buying dealership to make concrete assurances upfront.

When Does Trading In a Lease Make Financial Sense?

Looking purely at the dollars and cents, there are a few situations where buying out your BMW lease to trade into another dealership is smart:

Your BMW is Worth More than the Buyout Amount – If other dealers offer you $5,000 over your BMW lease residual, that’s an instant $5k profit opportunity. Take advantage of high used car demand.
Avoid Wear and Tear Fees – If your lease BMW has damage or excess mileage, turning it in may actually cost you penalties. Selling privately can offset this.
You Simply Love Your BMW – Forget the financials. If you are bonded with the car and will keep it long term, buyout math may not matter to you.

So if you can pocket a grand or two – or avoid lease turn-in fees – trading your lease to another dealer can pay off. But also weigh…

Trading into a BMW Dealer

Rather than dealing with the uncertainty of an outside dealer lease buyout, BMW makes it simple if you trade into one of their dealers instead. This allows for a seamless transition where BMW financial services handles paying off your lease, often with incentives or discounts on your new BMW.

It removes the middleman hassle and risk associated with 3rd party lease buyouts. And as a reward for your loyalty, BMW dealers typically offer additional incentives when you lease or buy a new BMW model from them. So explore you options.

Lease Buyout Car Loans

If you don’t have the cash to cover the total lease buyout cost, you’ll need to finance the remaining balance. This can be done through a lease buyout auto loan. Expect to pay higher interest rates than a new car loan, as lenders consider it financing a used vehicle. Shop around among multiple lenders to find the best rate.

Key Questions to Ask Yourself First

Before you decide whether or not to buyout your lease and trade your BMW into a new dealership, ask yourself:

Am I getting a good deal overall on the trade value?
Do I realistically want to keep this BMW for years to come?

If you answer no to either, buying out the lease may not be your best move. Do some soul searching before spending thousands on a BMW you regret later.

Downsides of Buying Out a BMW Lease

While trading in your leased BMW can net you cash or get you into another car, it also comes with responsibility. Here are downsides to consider before buying out your lease:

Higher Monthly Payments – You were likely paying discounted lease payments before. An auto loan or new lease on a used BMW will be pricier.
Lose Lease Perks – No more bundled maintenance plans or mileage buffers. You own it now.
Depreciation Risk – BMWs hold value well typically but market fluctuations can quickly make your buyout lose equity.

So weigh your options carefully before deciding to buyout and trade-in your leased BMW. Review all the steps we covered to make an informed decision.

In Conclusion

While BMW prohibits direct lease buyouts from non-BMW dealerships, you can potentially trade your lease into another dealer group with close BMW affiliations. But it requires coordination. First compare your BMW’s lease buyout terms to its market value and outside dealer offers to see if trading it in makes financial sense. Also consider bundled lease loyalty perks if you trade into a BMW dealer instead. Evaluate the pros and cons before buying out your BMW lease.