Since you didn't say in your post, prior to looking for a replacement, try to pull the seatbelt completely out. Close to the end of fully extending the seat belt, you should hear & feel a mechanical release. This will then allow the belt to automatically retract.

The rear seat belts supposedly have a "baby-seat" feature, which is invoked by some special method - forgot and since my X5 is in the shop, I can't run out and verify.

If the above doesn't work, then a new seatbelt assembly will be required, but based on your year, your belt should be covered for 7 years. Check your warranty with your vehicle, which is based on state law (not in your Owner's manual).