Cash versus finance.. smaller dealer?

[WILDHOBO]

So, you alter the already agreed upon purchase agreement at time of purchase? Interesting.

Not at all. I used a card to hold the vehicle after negotiating the price and trade values over the phone. Then I used a card to add a down payment later. I purposefully negotiate purchase price and trade only over the phone. No financing particulars are even discussed. Just price and trade.
And please don’t assume you know me when you accuse me of being unethical. There’s a big difference between strategic negotiation and changing the deal. I would never go back on a deal.

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[HankB]

I’ve used a cc to make a deposit for the past several cars. I haven’t met with any resistance from the dealers. I’m also a big fan of using their financing as long as there are no early payoff fees. The loans are paid off generally within the first six months, long enough to exist in the credit system, but not too long to cost much. The trade being positive information for credit history. The dealer gets their commission, we get positive data on our credit history and everybody except the bank is happy.

When you are paying off large sums doing it electronically is the easiest and quickest method. Bank checks in many cases have to be gotten in person, and they are still subject to hold periods after being tendered. Unless you are sending money overseas, there are no fees associated with electronic payments. A “wire transfer” is a very specific (and formalized) transaction, and these do cost money. However, an EFT (Electronic Funds Transfer) is basically a customized debit card payment that you arrange with your bank or financial institution as the need arises.

 

[sharpsicle]

Why use your own money at the point of purchase if you can go use someone else's?

If you don't want a loan hanging out, then just go pay it off after the origination is complete. In fact, then it doesn't even matter the rate they put you at, so it's even easier to 'haggle'. So long as the loan is structured properly and has no penalty, you're good to go without fronting your own money.

When I bought mine, they couldn't match the rate my CU could give me. But they attempted to adjust in other ways by lowering/waiving certain fees to make me feel better and incentivize me using their financing. I didn't care. I let them make it, then as soon as the loan was done and the title posted, I refinanced through my CU anyway. It was a win/win.

Finance is not a burden to a dealership. Quite the opposite, it's a product they want to sell. They're more willing to talk options when they have more options on the table. Take away options from them, like financing terms, and they have less to work with and are less likely to work with you.

No reason to go in and buy cash these days. Limits the options on both sides of the table.

 

[jensjer]

So, you alter the already agreed upon purchase agreement at time of purchase? Interesting.

I read this as the same purchase price.. but he put more down than initially said/planned.

 

[WILDHOBO]

I read this as the same purchase price.. but he put more down than initially said/planned.

Yep. That’s pretty standard. The “my wife and I talked, and we’re going to put more down” conversation is pretty common when price negotiation is done over the phone before the in person visit. I usually do it that way, since I usually know exactly what I want beforehand. I’d rather not drive to 5 dealers. I do still test drive that specific unit though before signing.

 

[MPMB]

Not at all. I used a card to hold the vehicle after negotiating the price and trade values over the phone. Then I used a card to add a down payment later. I purposefully negotiate purchase price and trade only over the phone. No financing particulars are even discussed. Just price and trade.
And please don’t assume you know me when you accuse me of being unethical. There’s a big difference between strategic negotiation and changing the deal. I would never go back on a deal.

Your original post stated "purchase agreement", which I understand to be the 'sign on the dotted line' paperwork and go on your way. "Offer sheet" is the agreed pricing, with payment function to be hashed out later.

 

[WILDHOBO]

Your original post stated "purchase agreement", which I understand to be the 'sign on the dotted line' paperwork and go on your way. "Offer sheet" is the agreed pricing, with payment function to be hashed out later.

No. A purchase agreement is a price agreement. I’ve done this many times. A fully refundable deposit holds the vehicle until a test drive and actual “contract” is in place, finalizing the deal. It does two things. It holds the vehicle for the customer until they arrive at the dealer, usually with an appointment in a few days maximum. It then protects the dealer and customer from price or trade value changes upon arrival at the dealer. It in no way is a contract.

 

[briscoelab]

^^^This exactly. Negotiating the price has absolutely ZERO to do with how much you put down, finance, etc. They are separate things. There is nothing "ethics" related about putting a given amount of money down.

1. Figure out the price on the new vehicle.

2. Determine your trade allowance only after this is settled (or determine if you want to trade at all). Of course have ACV offers ahead of time on your trade, so you have a realistic idea of what the wholesale value is on your trade.

3. Have a pre-approval from a CU or bank. Tell them you'll consider using their financing if they can beat your rate.

I do all negotiation via email and only go to the dealer when the car is there and I'm ready to drive away. Not once have I even had them ask how much I'm putting down until after all of that is settled. Usually not until I'm at the dealer and they are having the F&I manager getting the paperwork ready for me to sign.

I always have a pre-approval from my CU, which I tell them I'm willing to see if they can beat my pre approved rate. The dealer I usually use does indirect lending with my CU anyway, so it's always super easy.

This thread reads like a text book example of people having zero idea how to buy a car or how the process works.

Hopefully the constructive comments here help others out!

 

[WILDHOBO]

^^^This exactly. Negotiating the price has absolutely ZERO to do with how much you put down, finance, etc. They are separate things. There is nothing "ethics" related about putting a given amount of money down.

1. Figure out the price on the new vehicle.

2. Determine your trade allowance only after this is settled (or determine if you want to trade at all). Of course have ACV offers ahead of time on your trade, so you have a realistic idea of what the wholesale value is on your trade.

3. Have a pre-approval from a CU or bank. Tell them you'll consider using their financing if they can beat your rate.

I do all negotiation via email and only go to the dealer when the car is there and I'm ready to drive away. Not once have I even had them ask how much I'm putting down until after all of that is settled. Usually not until I'm at the dealer and they are having the F&I manager getting the paperwork ready for me to sign.

I always have a pre-approval from my CU, which I tell them I'm willing to see if they can beat my pre approved rate. The dealer I usually use does indirect lending with my CU anyway, so it's always super easy.

This thread reads like a text book example of people having zero idea how to buy a car or how the process works.

Hopefully the constructive comments here help others out!

I couldn’t have said it better. Absolutely correct.

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