Rebates, Incentives, APRs - Questions & Comments

CarMan@Edmunds · September 2001

Hi Glennis. It is difficult to say exactly what a manufacturer will do with their future incentives programs with 100% certainty. From what I hear, the Protege 5 is selling pretty well so far. So if I had to guess, I would say that I don't expect any major revisions to the incentives on this car during the month of October. Remember though that this is nothing more than an educated guess. I certainly don't see Mazda reducing its support on this car any. If you aren't in a hurry to get a new vehicle, I definitely don't think that there is any harm in waiting until October to see for certain if Mazda makes any enhancements to its program.

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avonne · September 2001

I am purchasing a vehicle from Ford after having leased two Ford vehicles. I received a customer loyalty incentive before. The salesperson told me that I am not entitled to a customer loyalty incentive because I am buying my car instead of leasing. I believe this is incorrect. I would appreciate some clarification as many companies are now offering customer loyalty incentives to retain clients.

PAman · September 2001

My salute goes out to GM and Ford for their initiative to reduce interest rates to 0% for a 60 month loan on a 2001, and greatly reduced interest rates on a 2002. I hope this allows them to avoid having to lay off one single factory worker and help keep the economy afloat.

For those of you not aware of the terms, the low interest rate is instead of taking the rebates that were in place. However, depending on the make and model, there are some rebates that can be taken with, or "stacked" with the zero percent financing. Some models are giving a loyalty rebate of $500 or $1000 if you buy or lease another car of the same make. GM is apparently still offering the Oldsmobile loyalty rebate on the purchase of an Oldsmobile, or another GM car or truck. There are also "conquest" rebates, meaning, for example, if you own a Ford and buy a GM product, you can get another rebate. The same is true if you own a GM product and buy a Ford.

As of this date, (Sept. 21, 8:20 a.m., CST) Daimler-Chrysler hasn't responded to the GM and Ford offers, but it seems very likely that they will soon.

The one thing I haven't heard GM or Ford offer is the chance to get out of a lease early without any penalties. GM was offering that earlier on SmartLease contracts, but it only applied to leases that ended up to March 2002. If GM offers that again on my lease that is up in June 2002, I will run, not walk, to my local dealer. And, by the way, my next car will be a purchase, NOT a lease.

Anyone on this forum have any pull with GMAC to make that offer??

Joe

PAman · September 2001

Some of you have voiced concerns that your dealer may not be disclosing all rebates, cash back or other incentives to you, the retail customer.

That is easy to fix! Here's how you do it. When they slide that contract across the table, ask them if ALL rebates, funds, offers, cash back or SPIFs (Special Production Incentive Funds) from the manufacturer, the dealer's group or the lender returned or refundable to the dealer have been applied to the purchase price. After they smile and say yes, with the contract in front of you, write the following, IN INK on the contract:
"Dealer states all special funds, rebates or offers have been disclosed to the retail customer and applied to the price. Dealer states that any rebates or refunds of any kind except the normal dealer holdback in effect at the time of purchase but not known or disclosed to the purchaser will be refunded to the purchaser." Then initial it and have the dealer do the same. If the manager has already signed it, have the manager initial it, even if you have to wait. If the dealer refuses, then you know they didn't disclose everything to you, regardless of their excuses.

Why do this? Simple; your contract likely contains the language in one form or another stating the following, even if in ultra-fine print on the back, that the purchase agreement is the only binding agreement between the seller and purchaser, and the contract supercedes all offers ORALLY OR IN WRITING. That means that if the lender, manufacturer or dealer's group has a secret rebate that they didn't disclose to you, but you find about it later, they either have to refund it to you or the contract is null and void. If you find out on Tuesday that the manufacturer had a rebate in effect on the car you bought Saturday but the dealer lied or actually didn't know about it (NOT likely to happen) and therefore kept it, you can take the contract back to them and demand to receive the rebate, or return the car to them. Without that language on the contract, you are powerless to get the money.

If you remember NOTHING else about this message, remember this: A written contract overides ANYTHING that the dealer promises you verbally. He can promise you anything in the closing room, but if it isn't listed on the paperwork and signed by both parties, it's as if he didn't say anything.

Happy hunting!

Joe

CarMan@Edmunds · September 2001

Avonne, the salesperson who you spoke with is incorrect. If you a current Ford Motor Credit lessee who purchases another Ford Product, you should be eligible for $500 Owner Loyalty Cash. Of course, this is less than the $1,000 that you would be eligible for if you were to lease a new Ford, but it's still something.

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CarMan@Edmunds · September 2001

Avonne, the salesperson who you spoke with is incorrect. If you a current Ford Motor Credit lessee who purchases another Ford product, you should be eligible for $500 Owner Loyalty Cash. Of course, this is less than the $1,000 that you would be eligible for if you were to lease a new Ford, but it's still something.

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peaches5 · September 2001

Does anyone know what the requirements are for this? I'm in the market for an F150 and I'm going to the dealer this week. I asked what the min. Beacon/FICO score was to qualify and the salesperson told me it wasn't based on that. I work for myself so I'm used to having to provide more income info that the average bear, but does anyone know what they're basing the qualifying on?

bilbo27 · September 2001

Have you heard anything on low interest rates on the 2002 sonata? I hope it will be just a matter of time considering the G.M. deal and soft car sales the n
next few monthes.

bobhalv · September 2001

I'm looking at buying a 2001 f-150 for invoice minue 1500 plus 2.9% financing. Should I wait and see if for increases the rebate?

rroyce10 · September 2001

..... If they have a customer loyalty program that is going on .. You get that, plus any and all rebates that currently exist.

Terry.

rroyce10 · September 2001

..... Instead of all the conversation and magnefying the contract --- Just pull up Ford .com and Ford will show all the existing programs --- then hit the print button, and take that to your dealer ...

It's much easier than "He said , she said " ..

Terry.

CarMan@Edmunds · September 2001

Hi bilbo27. I do not believe that Hyundai is offering any sort of special financing rates on the 2002 Sonata, yet. They do have interest rates of 0.9% for up to 36 months, 3.9% for 48 months, and 4.9% for 60 months on the 2001 version of this car though. They only incentive that I have heard about on the '02 Sonata is $1,000 Dealer Cash. Hyundai has consistently offered low financing rates on the majority of its models in the past, so if you are set on getting an '02 Sonata and don't mind waiting it is very likely that they will introduce low rates on it eventually.

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PAman · September 2001

Terry,

I've noticed two exceptions about rebates and incentives.
1. Some manufacturers are S-L-O-W to update their web sites. Often news sites like autonews.com or thecarconnection.com have news about rebates before they are on the manufacturer's web site.
2. Sometimes there are regional deals between the dealer and the manufacturer that are not posted ANYWHERE. Here's a couple of examples: Last year, I bought a new Chevy S-10 truck from an honest Chevy dealer. He told me about an additional $500 rebate from Chevy, and a $750 dealer cash offer that wasn't publicized. So, I got a $3,250 rebate when all the Chevy ads said the rebate on the S-10 was $2,000. My local Buick dealer has told me of two rebates on Regals that are not widely publicized that CAN be used with the zero percent financing GM is offering right now. One is a $500 loyalty rebate if I already own a Regal (I do) and a $500 "conquest" rebate if I own a non-GM product, which I also own. So, on a 2001 Regal, I can take the $2000 GM rebate, plus the other two $500 offers for a total of $3000, or $1000 plus the zero percent offer. On a 2002 Regal, I can take the zero percent and the $1000 in rebates, but the zero percent is not for as many months as it would be on a 2001 model.

The bottom line is if you are fortunate enough to have an honest dealer, he/she will put all the rebates on the table to make the deal. But, if you are not sure, that is when the disclosure language I listed earlier would protect you.

Joe

rroyce10 · September 2001

..... Good point.. alot of times I will check with Edmunds or Carpoint just to make sure that we are up to date -- a dealer can be 3/4 days behind, sometimes I find out what's going on with a TV commercial .. or the part I love is when a customer comes in and tells us .. ... l...o...l... especially on the regional programs.

Terry

megs50 · October 2001

For a while G.M was offering to buy out smart buys, does any one know if they are still doing that and if it is just theirs or any smart buy?

charko2 · October 2001

Hi: I emailed this question but have not yet received a reply. In August I decided to order a New Bonnivelle 2002. Left a deposit of 1K, at that time the rebate was 5.9% for 60 months. GMAC is now offering 2.9 for 60 months if you take from dealers stock. I am thinking of canceling the order forfiting my 1K deposit, and then repurchasing the same car $27000. from the dealer.
I figure I come out ahead or is my math off? Suggestions please.

montanafan · October 2001

Most incentives are for time of delivery, not when a car is ordered. If you haven't picked up the car and pick it up before the rate program ends, you will get the 2.9%.

charko2 · October 2001

The problem is that the rebate says take from dealers stock & this car was custom ordered. So?
Should I cancel the contract forfit the 1k deposit and then repurchase it from the dealer? it would be 2.9 vis 5.9 so I figure I still come out ahead or is my math flawed?

sysop · October 2001

charko2 · October 2001

CarMan@Edmunds · October 2001

Charko2, consumers are always only eligible for the incentives that are available on the vehicle that they are interested in getting at the time of delivery, not the time that they placed their order. So, you should not have any problem getting the dealership that you ordered from to let you finance your new Bonneville using General Motors' new low financing rates. There's no need for you to cancel your current contract and forfeit your deposit.

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PAman · October 2001

Megs,

GMAC called that early buyout a "Pull Forward" program. I have a Smart Lease, but at the time they offered that early out with no penalties, I still had too much time left on my contract in order to take advantage of the offer.

Right now, GMAC is not doing any early out options without whatever early payment fees are required in your written contract.

HOWEVER, as of a few hours ago, the bombs started falling over Afghanistan. If the war escalates, or the terrorist try some more cowardly, gutless, bastardly, underhanded and just generally sick attempts to kill more Americans the way they did on September 11, car sales could take another nose dive. If that happens, GM may have to sweeten the pot a little more in order to get people buying. That MAY include another "Pull Forward" offer.

You may want to go to the website for the GM brand you are interested in and send them an e-mail saying you would buy one of their cars or trucks if you could get out of your Smart Buy contract without any penalties. I've already done that, but if more people did the same, maybe it would get them off of their hands and seriously consider this.

Joe

davids1 · October 2001

I have breezed through the previous posts and did not see this topic covered. I am looking at a NEW 2000 model Silverado with only 100 miles. This truck is brand new and has never been titled. The salesperson said I could buy the truck outright with a significant discount off of sticker, but when we looked at trading my Intrepid, that deep discount disapperared. Is there any way I can find out if the dealer has any incentives to move this 2000 model. I have looked at the incentives pages on Edmunds and they only cover 2001 and 2002 models. Usually dealers are offered significant incentives to move these leftover vehicles. Any information would be greatly appreciated.

Thanks

David

peaches5 · October 2001

It's rare for 2000 to still be on a lot this close to 2002 - it sounds like they'd almost pay you to buy it

but figured they'd see what they could nail you for on the Intrepid. I *doubt* there are any manufacturer incentives - probably just a dealer wanting it off the lot. What's their reason why it hasn't sold? Get a binding sales order for the truck, ignore the trade, and sell the Intrepid yourself.

CarMan@Edmunds · October 2001

David, at this point in the year the vast majority of dealers who have left-over 2000 models remaining in inventory have received a one-time Dealer Cash allowance from their manufacturers. In your case, you are looking at a 2000 Chevrolet Silverado. Any dealerships that had 2000 Silverados left on their lots received final pay Dealer Cash from General Motors back in March of this year. I believe that the specific amounts of this cash at that time were $500 on 2000 Silverado 1/2-Ton Reg. Cab 2WD, Ext. Cab 4-Dr. 2WD, & 3/4-Ton Ext. Cab models. $1,000 on 2000 Silverado 1/2-Ton Reg. Cab 4WD, Ext. Cab 4-Dr. 4WD, & 3/4-Ton Reg. Cab. And $1,500 on 2000 Silverado 1/2-Ton Ext. Cab 3-Dr. models. An additional $1,000 on top of these allowances was offered to dealerships in certain regions. Of course, any 2000 vehicles that are still around have depreciated significantly without having been driven a mile at this point. If you purchase this 2000 Silverado at this time, you should receive a significant discount on it. If you don't, I personally do not see any advantage of buying one over a newer model.

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davids1 · October 2001

That's why I stated that the deep discount disappeared when I started talking trade. Thanks for all the info.

tonychrys · October 2001

guest · October 2001

PAman · October 2001

There are several things you need to check into carefully.

1. WHY does a Chevy dealer still have a leftover 2000? Does it have a manual tranmission in a market that usually buys automatics? Small engine vs. the big engine? No A/C, stereo or other popular and common options? If you buy an unpopular truck when it is new, it is not going to be any more in demand when it is 2, 3 or 4 years old.

2. Look at the window sticker and see if Chevrolet originally sold and delivered that truck to the dealer that has it now. If not, it may have been part of a dealer trade or bought at a HUGE discount from a closed or bankrupt Chevrolet dealer (yes, it DOES happen!) If the "dealer sold to" isn't the same dealer you are dealing with, you want to ask the entire history behind this truck. If the dealer doesn't have the window sticker, he is violating federal vehicle regulations; go find another truck at another dealer. There is nothing wrong with buying a truck that was part of a dealer trade, but if he bought it from a bankrupt dealer, he may be able to discount the truck much more than he is letting you know.

3. Was the truck damaged in transit, and that is why it has remained unsold? Was it tied up in an insurance dispute between the carrier, the dealer, the manufacturer and the insurance company? If so, the dealer may have not been legally allowed to sell the truck until all claims were settled. Was it flood damaged during any of the recent storms? You didn't say what state you are in, but there have been many areas with record floods. If so, you may be looking at a truck that had major damage. ASK; even if your state doesn't have strong manditory disclosure laws, they should give you a straight answer to this question. If they say ANYTHING other than "NO, this truck was not damaged in transit, in shipping, while on the dealer's lot or in any other way, shape or manner" AND be willing to put that in writing, then, once again, find another truck at another dealer. If he DOES state the truck was damaged, but tries to claim it was "only minor stuff," then ask to see all the workorders used to repair the truck. Even if it is fixed "in house" in his own shop, he will have paperwork to track things like parts, labor and other costs.

4. VERY IMPORTANT: This question is many times more important than whether the truck has ever been titled. Has it ever been placed in what Chevrolet calls "in service." The ISD, or "in-service-date" is what starts your GM warranty. While the truck may have never been titled and only have been driven a few miles, it may have been placed in-service in October, 1999, which means you may be buying a new truck with very little warranty left on it. If that dealer won't give you a good answer, ANY Chevrolet dealer can check the GM database for the truck's ISD with only the vehicle's VIN.

5. As for the discount disappearing when you mention trade, it is more a symptom of the make of your trade. Chevy dealers don't have much demand for a used Dodge car. You would probably be much better to sell your car outright, even if you practically gave it away, since most Dodge Intrepids don't bring anywhere near their book value. They were not extremely big sellers when they were new, and now it's just an average used car. By selling it yourself, you could walk in with cash and REALLY negotiate a huge discount.

Good luck,

Joe

surffla1 · December 2001

I recently factory ordered my vehicle. I accepted the risk that the customer and dealer cash incentives might change up or down at delivery. The car arrives any day now at the dealer and the incentives remain the same. When the salesman drew up the "New Vehicle Pricing" form he deducted the Consumer Rebate of $1000.00, Farm Bureau Rebate of $500.00 and Dealer Incentive (Yes I am getting that too) all from the Total Vehicle Cost to arrive at Total Vehicle Cost Less Rebates. However in the Purchase Agreement only the dealer cash was deducted from the pre-tax price of the vehicle and the Consumer Rebates were not taken out until after State Sales Tax (and of course with an asterisk only if qualify at time of delivery.) So my question is now that the vehicle is ready for pickup and all incentives remain, when do they get deducted?

robsmith · December 2001

Not sure if it varies from state to state but rebates are typically deducted after sales tax.

I like to compare it to the rebates you get at a computer store. You typically pay the full price and tax and you get your money back in the mail.

The only difference here is you get your money back right away and apply it to the purchase price.

If you bought a PC for $1000 and it has a $200 rebate you will still pay $1000 for the PC along with taxes and then get your $200 rebate back later.

surffla1 · December 2001

So it was just another gimmick. It was when they threw in the dealer cash that I finnally bit the hook and said sold. And of course at that moment the total pretax cash price of vehicle included deductions for the rebates. Then when purchase order was drawn up it of course changed to rebates deducted after taxes. We are only talking about $200.00 difference in OTD price here, but thats still $200.00 to me and not chump change. I guess I'm the chump. Oh well, live and learn!

audia8q · December 2001

if you don't like the "gimmick" as you call it...complain to your state government. They are the ones who determin how your taxed. Not the dealer.

Rich

surffla1 · December 2001

it is the way the dealer presented it to me. First I was led to beleive that all incentives would be deducted from the pretax cash price of the vehicle. That initial pretax cash price was within my goal for the pretax price of the car. As I said before it was not until they threw in the dealer cash that I said OK. However when the purchase order was then drawn up the pretax cash price of the vehicle went way up as the rebates were then deducted post sales tax. You think that was fair dealing?

audia8q · December 2001

yes i do...the dealer presented you with the actual selling price of the car.. less all rebates. It still seems to me you just don't like the way your taxed.

rich

rroyce10 · December 2001

...... Again, this is not a Dealer thing.. it's the way the state taxes the amount ..

I think you are unhappy with the way its done .. That's your local Government at work.

Also remember if you are getting some of the dealer cash, that goes to the 3rd line and that's what changes the difference -- all rebates go the end..the net, just like if you putting cash down ..

I have read some of your previous posts, and as much as you might like to, you just can't beat the Dealer ..and the Government at the same time..

Terry.

vwguild · December 2001

are different, and therefore taxed differently...
The Rebate is taxed because it is really like handing you the cash...Incentive $$$ should be
viewed as a discount...

landru2 · December 2001

Any customer rebates from the manufacturer that give you the option of receiving the amount in cash are taxable. Any other incentives that you receive (like factory to dealer cash) are not taxable because you cannot receive a cheque for this money from the manufacturer. It goes to the dealer who can then deduct it from the price before tax.

CarMan@Edmunds · December 2001

The previous posters are absolutely right, surffla1. Your dealership is calculating the tax on your new vehicle correctly. Essentially most states treat dealer cash as a reduction in the price of the vehicle by the manufacturer and do not tax them. However, consumer cash incentives are usually taxable. Although tax laws do vary from state to state this is almost always how this sort of situation is treated.

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sonjaab · December 2001

List.......... 33,000
Minus trade....16000
Taxable amt. ..17000
Plus tax....... 1190
------
$ 18190
Minus gm discount 5000
Minus gm mc cash 1500
minus gm rebate 1500
minus gas tank cert 500
total to be financed $9690

This is how it worked for me on my
recent truck purchase in NY.....Geo

cfg1 · December 2001

What is a gm discount?

sonjaab · December 2001

Gm employee family discount $5000
GM $ 1500 2500LD rebate (for anybuyer)
also GM employee special 2.9% Int (3 yrs)
And NO ADVERTISING FEE for GM employee-
family either !!!!!!!
But I paid $40 for plates and $75 document fee
$15 (?) NYS state inspection fee
Sorry me bad .....forgot.........Geo

pepper50 · January 2002

Is a rebate usually deducted from the final amount you pay, and then the dealer gets the rebate from the factory? Or do you pay the final price and wait for a rebate check from the factory in the mail? Thanks.

landru2 · January 2002

It depends on what the customer wants. You can either sign it over to the dealership in which case they will deduct it from the price or you can leave the price and have a cheque for the rebate mailed to you. Be aware that any advertised price you see will be with the rebate already deducted.

rroyce10 · January 2002

........ The rebate should show on the last line, just like money down...

If you have the rebate sent to you (takes 6 weeks), you will also get a 1099 .. that's not good ..l.o.l.

Terry.

surffla1 · January 2002

jpmack2 · February 2002

Currently there are several car manufactures offering significant rebates or incentives to buy new vehicle. Many of them are targeted to expire at the end of February. Do folks here think that with the spring car buying season on the horizon, these incentives will increase or reduce?

Any thoughts on this topic would be appreciated.

usaf52 · February 2002

from what I've read, the manufacturers seem to test the waters to see what their competitors are up to. GM rebates end today (2/28). Ford ends on March 5. Logically, would anyone go into a GM dealer to buy a car tomorrow?? It would seem that car sales would fall dramatically after a rebate, while the car buying public watches to see what will transpire. It's hard to get someone to pay $20,000 for a car that was selling for $2,000 less yesterday.

tronsr1 · March 2002

Today's news reports that Ford and GM have extended the rebates for March {same rebates and incentives}

artwis · March 2002

GM added $500 to the $2002 on certain models but it's either rebate or lower interest rate not both as it's been. GMs new deal is listed on "smart shopper" forum
Art

Rebates, Incentives, APRs - Questions & Comments

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