How do I use a credit union check for financing a new car?

sm2004d

So my wife and I were at a dealership yesterday and were ready to purchase a vehicle after weeks of research/looking. We're pre-approved through our credit union and were given a check to fill out in financing. However... and this is where the problem starts... the fiance manager wanted us to fill out an option contract instead. He said that this was SOP and that we would have to go through the process of bringing the contract to the credit union to get a purchase order (I think that's what it was), and then bring in a check for the amount of loan.

But the instructions on the check are different and very clearly state that we fill in the amount, and that no other check or paperwork is needed. The finance manager was adamant about the option contract and wouldn't budge. We walked out, but can't get any clear answers today because the credit union is closed. What to do?

Mr_Shiftright

Well what were the options in the contract that the dealer was so adamant in enforcing?

sm2004d

It was the process that was insisted upon. First, they said we had to run our credit even though we had financing in place. Then, after they agreed not to run our credit at our insistence, they put in an arbitrary finance rate (5.45%) into the option agreement section of the contract. We were a little confused by this, since we have a check from the credit union for them to fill out. They said it's to cover their bases in case the credit union check didn't go through after we drive off the lot.

I guess I'm confused about the process itself. Is it standard for them to fill out that option part of the contract with their own financing number even though we've given them a check? Will they shred the contract once the check goes through? What if they don't process the check in time?

Mr_Shiftright

I'd have to read the contract. They are obviously putting some kind of options in there that they want you to agree to, so I have no idea if they are odious or not.

Let's see if we can find some current or past car salespeople to jump in here.

kyfdx

Did you want to give them the check and take delivery immediately? If so, I don't doubt they wanted some sort of backup, in case the check/deal didn't get approved by the credit union.

That's what happens when you do the backup financing contract. Once your credit union deal goes through, they tear up the contract.

But, they want to sell you their financing, and won't make it easy for you to use your credit union. All that said, they are perfectly justified in making sure they get paid.