Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!





Howdy, Stranger!

It looks like you're new here. If you want to get involved, click one of these buttons!

Have you recently tried to purchase a new vehicle after being out of the market for a while and found that prices were much higher than you expected? A reporter would like to talk to you; please reach out to [email protected] by 1/22 for more details.
Did you get a great deal? Let us know in the Values & Prices Paid section!
Meet your fellow owners in our Owners Clubs

Financing a new car

coconutscoconuts Posts: 11
edited September 2019 in General
Hi,

I've been shopping around for a while for a new 2019 VW Atlas SEL Premium to get a best deal possible. As I educated myself, I've been negotiating prices via email. So I negotiated a good price I believe and asked for a signed purchase order which the dealer has emailed me. I haven't mentioned whether it's cash, finance or lease, said we'll get there once we agree on the selling price.
We thought we might finance it as we plan on keeping it (at the beginning we wanted to lease).
So after getting the buyers order I said we'll finance it. We wanted VW Credit 1.9%. We have good credit score of 750+. The dealer is participating with VW Credit, but said "That price does not qualify with the 1.9%" and "you can not get that price with the 1.9%". They stated we need to finance it with banks approved by them and offered 4.99% for 60mo or 5.19% for 72mo. We also have a better deal from our own bank. I understand they now want to make up for the deal they gave us.
It is my first time shopping for a new car and I have no idea - is this even legal? Can a dealer deny you financing you choose? So can a dealer deny the sale if we won't agree to the higher %?

Any input would be greatly appreciated!
TIA.

Answers

  • kyfdxkyfdx Posts: 142,577
    coconuts said:

    Hi,

    I've been shopping around for a while for a new 2019 VW Atlas SEL Premium to get a best deal possible. As I educated myself, I've been negotiating prices via email. So I negotiated a good price I believe and asked for a signed purchase order which the dealer has emailed me. I haven't mentioned whether it's cash, finance or lease, said we'll get there once we agree on the selling price.
    We thought we might finance it as we plan on keeping it (at the beginning we wanted to lease).
    So after getting the buyers order I said we'll finance it. We wanted VW Credit 1.9%. We have good credit score of 750+. The dealer is participating with VW Credit, but said "That price does not qualify with the 1.9%" and "you can not get that price with the 1.9%". They stated we need to finance it with banks approved by them and offered 4.99% for 60mo or 5.19% for 72mo. We also have a better deal from our own bank. I understand they now want to make up for the deal they gave us.
    It is my first time shopping for a new car and I have no idea - is this even legal? Can a dealer deny you financing you choose? So can a dealer deny the sale if we won't agree to the higher %?

    Any input would be greatly appreciated!
    TIA.

    It's entirely possible that the dealer gets a bigger incentive with 3rd party financing.
    To be technical, the dealer isn't denying you the low rate financing, just saying you can't get it at the price they quoted.

    What is your location?

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

  • My location 07026, the dealer is in different state.
    Would you be so kind to explain to me why can't I get it at the price they quoted? VW Credit allows it at this price.
    Thank you!
  • kyfdxkyfdx Posts: 142,577
    coconuts said:

    My location 07026, the dealer is in different state.
    Would you be so kind to explain to me why can't I get it at the price they quoted? VW Credit allows it at this price.
    Thank you!

    VW Credit doesn't have anything to do with a price offer from a dealer. You got a quote, with incomplete information (buy, lease, finance?). A dealer will naturally quote you the lowest price they can. Even if that involves less than optimal financing. It happens all the time.

    On some makes/models, it wouldn't make any difference. But, VW has widely varying incentives on buy vs. lease. What state is the dealer's location?

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

  • coconutscoconuts Posts: 11
    edited September 2019
    kyfdx said:

    coconuts said:

    My location 07026, the dealer is in different state.
    Would you be so kind to explain to me why can't I get it at the price they quoted? VW Credit allows it at this price.
    Thank you!

    VW Credit doesn't have anything to do with a price offer from a dealer. You got a quote, with incomplete information (buy, lease, finance?). A dealer will naturally quote you the lowest price they can. Even if that involves less than optimal financing. It happens all the time.

    On some makes/models, it wouldn't make any difference. But, VW has widely varying incentives on buy vs. lease. What state is the dealer's location?
    Seems like I totally don't get shopping for a new car :( Everywhere I read about negotiating was said not to bring out the information whether it's lease, finance or cash until we agree on the selling price. Also, that a buyer should have their own financing so the dealer won't take advantage of them in the F&I. Which I have too, and it's better than the dealer's offer.

    The dealer location is 19003.

    So what do I say? What do I do in such situation? Advice please...
  • kyfdxkyfdx Posts: 142,577
    coconuts said:

    kyfdx said:

    coconuts said:

    My location 07026, the dealer is in different state.
    Would you be so kind to explain to me why can't I get it at the price they quoted? VW Credit allows it at this price.
    Thank you!

    VW Credit doesn't have anything to do with a price offer from a dealer. You got a quote, with incomplete information (buy, lease, finance?). A dealer will naturally quote you the lowest price they can. Even if that involves less than optimal financing. It happens all the time.

    On some makes/models, it wouldn't make any difference. But, VW has widely varying incentives on buy vs. lease. What state is the dealer's location?
    Seems like I totally don't get shopping for a new car :( Everywhere I read about negotiating was said not to bring out the information whether it's lease, finance or cash until we agree on the selling price. Also, that a buyer should have their own financing so the dealer won't take advantage of them in the F&I. Which I have too, and it's better than the dealer's offer.

    The dealer location is 19003.

    So what do I say? What do I do in such situation? Advice please...
    Back when leasing was new, and the earth was still cooling off from the big bang, things were simpler. The price was the price. ;)

    The advice about negotiating is still good, but if you don't have the inside poop on how the dealer's incentives change, based on buy, lease, etc, then you run into things that don't make sense. Don't feel alone, it happens to all of us.

    If the dealer uses 3rd party financing, or you pay cash, they get $3250 from VW
    On a lease, they get $2400
    If you take the 1.90%, 60 month financing, they get $2000.

    So, those are the deltas you are working with. Likely, they based their price on the $3250, plus making money on selling you financing. If you wan the low rate financing, I would expect the price to be $1250 higher.

    Now, they still get the $3250 if you bring your own financing or pay cash, but then they don't get to markup the rate and make any extra money in the F&I office. Seems their price should still be good for either, but until you sign a deal, nothing is set in stone.

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

  • kyfdx said:

    coconuts said:

    kyfdx said:

    coconuts said:

    My location 07026, the dealer is in different state.
    Would you be so kind to explain to me why can't I get it at the price they quoted? VW Credit allows it at this price.
    Thank you!

    VW Credit doesn't have anything to do with a price offer from a dealer. You got a quote, with incomplete information (buy, lease, finance?). A dealer will naturally quote you the lowest price they can. Even if that involves less than optimal financing. It happens all the time.

    On some makes/models, it wouldn't make any difference. But, VW has widely varying incentives on buy vs. lease. What state is the dealer's location?
    Seems like I totally don't get shopping for a new car :( Everywhere I read about negotiating was said not to bring out the information whether it's lease, finance or cash until we agree on the selling price. Also, that a buyer should have their own financing so the dealer won't take advantage of them in the F&I. Which I have too, and it's better than the dealer's offer.

    The dealer location is 19003.

    So what do I say? What do I do in such situation? Advice please...
    Back when leasing was new, and the earth was still cooling off from the big bang, things were simpler. The price was the price. ;)

    The advice about negotiating is still good, but if you don't have the inside poop on how the dealer's incentives change, based on buy, lease, etc, then you run into things that don't make sense. Don't feel alone, it happens to all of us.

    If the dealer uses 3rd party financing, or you pay cash, they get $3250 from VW
    On a lease, they get $2400
    If you take the 1.90%, 60 month financing, they get $2000.

    So, those are the deltas you are working with. Likely, they based their price on the $3250, plus making money on selling you financing. If you wan the low rate financing, I would expect the price to be $1250 higher.

    Now, they still get the $3250 if you bring your own financing or pay cash, but then they don't get to markup the rate and make any extra money in the F&I office. Seems their price should still be good for either, but until you sign a deal, nothing is set in stone.
    Wow, thank you! I had no idea about it.
    As they say it has to be bank approved by them, it means my only option would be to let them make money on the financing and finance through them, I suppose...? Is this common? I seriously had no idea a dealer could dictate where should I get financing from...

    Are you able to tell me what realistic MSRP discount on a new 2019 VW Atlas SEL Premium is? I'm still in the dark here...
  • kyfdxkyfdx Posts: 142,577
    coconuts said:

    kyfdx said:

    coconuts said:

    kyfdx said:

    coconuts said:

    My location 07026, the dealer is in different state.
    Would you be so kind to explain to me why can't I get it at the price they quoted? VW Credit allows it at this price.
    Thank you!

    VW Credit doesn't have anything to do with a price offer from a dealer. You got a quote, with incomplete information (buy, lease, finance?). A dealer will naturally quote you the lowest price they can. Even if that involves less than optimal financing. It happens all the time.

    On some makes/models, it wouldn't make any difference. But, VW has widely varying incentives on buy vs. lease. What state is the dealer's location?
    Seems like I totally don't get shopping for a new car :( Everywhere I read about negotiating was said not to bring out the information whether it's lease, finance or cash until we agree on the selling price. Also, that a buyer should have their own financing so the dealer won't take advantage of them in the F&I. Which I have too, and it's better than the dealer's offer.

    The dealer location is 19003.

    So what do I say? What do I do in such situation? Advice please...
    Back when leasing was new, and the earth was still cooling off from the big bang, things were simpler. The price was the price. ;)

    The advice about negotiating is still good, but if you don't have the inside poop on how the dealer's incentives change, based on buy, lease, etc, then you run into things that don't make sense. Don't feel alone, it happens to all of us.

    If the dealer uses 3rd party financing, or you pay cash, they get $3250 from VW
    On a lease, they get $2400
    If you take the 1.90%, 60 month financing, they get $2000.

    So, those are the deltas you are working with. Likely, they based their price on the $3250, plus making money on selling you financing. If you wan the low rate financing, I would expect the price to be $1250 higher.

    Now, they still get the $3250 if you bring your own financing or pay cash, but then they don't get to markup the rate and make any extra money in the F&I office. Seems their price should still be good for either, but until you sign a deal, nothing is set in stone.
    Wow, thank you! I had no idea about it.
    As they say it has to be bank approved by them, it means my only option would be to let them make money on the financing and finance through them, I suppose...? Is this common? I seriously had no idea a dealer could dictate where should I get financing from...

    Are you able to tell me what realistic MSRP discount on a new 2019 VW Atlas SEL Premium is? I'm still in the dark here...
    We don't follow pricing, but you can access Edmunds price research, here:
    https://www.edmunds.com/tmv.html

    I would shop more dealers.

    Did you get a good deal? Be sure to come back and share!

    Edmunds Moderator

Sign In or Register to comment.