Any Questions for a Car Dealer?

dbauer · January 2005

"The difference may be that I did not have my checkbook with me, and he was afraid I might never come back with it."

bingo!!!

audia8q · January 2005

If somebody wants to put a large amount on a credit card we suggest one of two things..

1..go get a cash advance and pay the dealer cash.

2..use a credit card check and in some cases the rules of the credit card do not apply to the merchant..but this can vary per issuing bank.

Another issue pops up with a credit card if the consumer is taking a loan on the car. Most banks frown on consumers "borrowing" the down payment money on a credit card, which overall increases the total amount financed...it is skewing the debt to income ratio ...if they find out it can effect the percentage rate or even cause them to decline the loan.

driftracer · January 2005

lender/dealer agreements, if the dealer doesn't tell the lender ALL of the financial information, they can get sanctioned by the lender.

steine13 · January 2005

Speaking of lender/dealer agreements; this stuff is actually pretty dicey.

When I paid for my last bicycle, I asked if they would rather have cash, and if they would perhaps give me a small discount. Wasn't that expensive a bicycle, but I've bought cars for less...

Anyway, the owner said he couldn't do that, and that he had to sign an agreement with Visa/MC that he would NOT offer discounts to people who didn't use credit cards.

So I'm not sure that a car dealer who accepts CC payments at all is really "allowed" to refuse large sums.

My personal record is something like $6k on a Credit Card, but it was the GM Card, and I bought a new Prizm... they didn't bat an eye.

-Mathias

user777 · January 2005

...assuming the dealership would take it, and AMEX would OK it, I wonder if the warranty would be extended by a year under the Purchase Protection Plan which covers other manufactured goods?

I sort of doubt it.

steine13 · January 2005

That question has been asked before.

My information, worth what you paid for it, is that all these contracts explicitly exempt cars from the warranty extension. -Mathias

rroyce10 · January 2005

.. **Dealer does not want to do this, as they pay a merchant fee to Amex. I'm willing to split the difference with them, but they claim the rate they pay is almost 5%**

          Lets see if I have this right ... your getting a free car from your Father-in-law and now your trying to bilk the car dealer .l.o.l...?

          Some dealers won't take an Amex even on service, let alone on a sales contract ..

1.) If you take the vehicle and you smack a fender or dent the door, the dealer doesn't want the vehicle coming back on a tow truck and having the Credit card go "in dispute" for $20 large because you don't want the "new car" anymore (it happens more than you would think) .. then there is: who's name is on the contract and who's name is on the credit card thing ..

2.) Some dealers will take Amex for the $2,0/$3,000 down payment like in Mathias case ... but the cost is based on "continuous use" with Amex, kind of like cell phone minutes .. if a dealer uses it for $5,000 of service work a month and someone drops a $20,000 purchase, then it can be 5% .. most average 3% - So you want the dealer to suck up $600 to "earn" your business ...... {hmmm, let me see if I have this right, he's getting a free car, and he's trying to beat the dealer out of $600 .. the question, is this someone you would invite to dinner parties.? ~ I'll have to ponder this over my next cup of coffee} ........... ;^)

                               Terry.

damish003 · January 2005

Well folks, it's a moot point, as I bought the car last night and will have a check cut for the total. So, no Amex.

Just to make this clear, I'm NOT getting a free car. Would be nice, but. We'll be paying my father-in-law back for the next few years. Can't beat 0% now can ya?

I had no intention of bilking the dealer, or getting $600 out of him. And I'm very friendly at dinner parties, Terry, thank you very much

Here was the deal. If the actual dealer rate was 2%, I would split it or cover it. What bothered me was if the rate WAS 2%, and he claimed 5%, that I was being screwed. The most I might try to get out the dealer was 1%. But it didn't even matter.

I got the car for $100 under Edmunds TMV. Took 2 hours, between test drives and coming to terms. Had no trade, no financing for them to worry about. Nice, simple deal.

Lots of learning from the posts that my question generated, so thanks all for that. Maybe it will help someone else who might want to use credit cards for a car purchase.

-Dan-

user777 · January 2005

yeah, maybe. depends. you don't benefit from paying the creditor w.r.t. improving your credit rating... i mean, i *think* / *thought* it worked that way...demonstrate a track record of timely payments to your creditor and all.

unless one's credit isn't the greatest to begin with..but still, i would never ever have my parents purchase a major item like that for me.

i'm not saying this applies to you, but if for example my credit was shakey enough i couldn't afford the payments, why would i want my parents "enabling" me further into fiscal mismanagement? i'd hope they'd just say "no".

and the 0.0% is just the $$$ piece of the arrangement.

i understand that being able to purchase a car with no interest has advantages... there is always the ability to pay down the vehicle quicker than the full loan period without penalty isn't there? (i suppose it depends on the contract).

damish003 · January 2005

Well, I wasn't really asking the question, more of a rhetorical thing than anything else, but what the heck?

Credit is not the problem. My FICO score is 750 something, so that's OK. The wife has investment income from out of state and is on SSD, so she doesn't have much credit. The dollar amount we'll pay every month is well within our comfort region. We could have played around with separate financing, but she needs this real quick, 0% is wonderful, and if the crap really hit the fan someday, it's not hurting the father-in-law at all. Actually, he just wanted to GIVE her the car, but I can't let him do that. That male pride thing, I guess.

Some good thoughts about the rate. Thanks for the post.

-Dan-

bluedevils · January 2005

We typically put a $1,000 down payment on the credit card when buying a new vehicle. Have done this 3 times with different brands without any guff from the dealer.

I think many folks don't realize that the merchant (in this case, the dealer) incurs a fee to accept credit card as a form of payment. So they may not realize they are eating away at the dealer's profit margin.

For me, it's just easier to charge it. I get a month or 2 interest free before that amount is due, and I earn 2% in my daughter's 529 college savings account for all purchases. So a $1,000 charge gets $20 in her account, which is worthwhile.

andyman73 · January 2005

And I thought my father in law was great. Not only did he give us 2 Z plan pin #s, saving us 8K, but gave me a used car, retail of 8K, also. Well, I still owe 4K,his price,but they don't want the money. I know, cuz we've tried to pay them. As long as I continue to do right by their daughter, they will continue their generosity. I'm not complaining.

andyman73 · January 2005

Took me 12 work days, but I read up from post #7000. Lots of fun reading. Ya'll have my sympathy for that "reverse auction" troll. Man what a nut!

I will definitely keep up on this thread. Learning lots of things that will help my next new car purchase, due in 2010! But don't tell the CCBA folks! LOL!

stickguy · January 2005

I have used a CC for a deposit, but generally when I made a deal over the phone, and was making sure that the unit was reserved for me. Got burned once by making a deal over the phone, but they sold it out from under me before I got there with a deposit check (later that day).

bryan · January 2005

I have purchased three GM cars in last two years from the same dealer. I gave the deposit on all three on a credit card as I don't carry my check book with me everywhere I go, and well, we'll just say I intended to buy the cars, but not just at the time I did, if that makes any sense. So I think the credit card deposit was encouraged to make sure I bought that day.

dbauer · January 2005

more often than not, we will only "authorize" the CC. the amount of the deposit will actually be included in the deal rather than incurring the fees.

bryan · January 2005

I see your point. In my cases, tho, the deposits were $500 on the credit card each time, and that was deducted on the paperwork from my total amount financed. So I imagine the fees incurred were minimal, say about $15 (3%???).

Kirstie_H · January 2005

What about debit cards? Since these are replacing the checkbook for more & more consumers, I'd be interested to know if the same (or similar) fees are charged for their use.

robr2 · January 2005

Yes - actually higher fees in some cases.

http://consumeraffairs.com/news03/walmart_mastercard.html

Kirstie_H · January 2005

Huh, that's interesting. You'd think that a debit card transaction would be a cheaper transaction to process than a check, and that therefore, banks would encourage the use of debit cards over paper checks.

robr2 · January 2005

kirstie - today I think they both cost about the same with the new way of processing checks. Also, have you ever been in a store where they take your check, scan it, and then hand it back to you. They convert it into an electronic payment. But there is still a cost associated with it as there is with accepting a debit card.

I remember about 8-10 years ago when stores and gas statios started accepting ATM cards and you entered your PIN. They were charging $0.50 in order to recoup the bank charge. Now they all eat that charge.

With a branded debit card, MC and Visa charge the store their normal scale - let's say 3%.

On a $100 sale that's $0.50 vs. $3.00 - which would the store rather pay?

Wal-Mart feels it's a debit transaction - MC sees it as a MC transaction.

driftracer · January 2005

no longer accepts Master Cards...

jlawrence01 · January 2005

They no longer accept MC **DEBIT** cards.

driftracer · January 2005

akangl · January 2005

Hmmmm, I work at Walmart and use a MC debit card with no trouble. Use a Visa debit card too. Never a problem.

driftracer · January 2005

isn't part of the rest of the world....I saw a news release on it about 2 months ago.

akangl · January 2005

That's right! We are a country unto ourselves.......hmmm, maybe we should start charging at the border or limiting new immigrants to our country.

As far as I know the Walmarts up here follow the same rules as the rest of the Walmarts. We still have to follow home office rules even though we are in our own little world.

robr2 · January 2005

Wal-Mart will accept debit MC's only a PIN transactions - they don't let you sign for it.

So veering back on topic - terry: can I use a debit card at one of your stores to buy a shiny new blahmobile?

turboshadow · January 2005

"That's right! We are a country unto ourselves....... "

We (South Carolina) tried that back in 1860. The Feds take a dim view of that attitude ;-)

Turboshadow

kyfdx · January 2005

robr2 has it right.. If you use it with a PIN number, the transaction is much cheaper for the merchant..

Like $0.25 vs. 3%..

At the local grocery store (Krogers), that is why they ask you debit or credit... If they enter it as a debit card, and you use the pin... very cheap..

regards,

kyfdx

danf1 · January 2005

I can't speak for Terry, but you cannot use a credit or debit card at any of my stores for purchase or down payment.

dbauer · January 2005

we decide on a case-by-case basis. depends on the deal.

kyfdx · January 2005

You mean, if its a $5K gross deal, he can pay with pennies in a wheelbarrow if he wants to, right? lol

Kirstie_H · January 2005

OK... for $0.25 it seems worthwhile to consider accepting a debit card for a deposit. Most people carry their debit cards more often than a checkbook, so it would prevent the customer leaving simply because he/she didn't bring the checkbook. Don't those transactions clear pretty quickly?

Guess I don't need to be thinking of easier ways for the dealer to get you to "buy it today."

dbauer · January 2005

exactly!

kyfdx · January 2005

Yeah.. that is assuming the dealership has the equipment to process it that way.. A big grocery store chain.. no problem. But, I'm not sure how they accomplish that at other businesses..

danf1 · January 2005

We cover that situation by doing two contracts. One with down payment and one without. If you bring me a check within 24 hours, I'll shred the contract with no $ down. If not I cash the other.

akangl · January 2005

***Wal-Mart will accept debit MC's only a PIN transactions - they don't let you sign for it.***

Hmmmm, now I'm going to try and sign it. I think I did since I rarely use it as a debit card. (its actually my hubby's account, I just *borrow* money from it on occation)

dbauer · January 2005

i dont know where you are, but MOST states tax AFTER the rebate is deducted.

dreamstar · January 2005

I placed an order yesterday for a 2005 bmw 330Ci convertible. The salesperson tried to sell me an identical one that was a 2004 with additional options for a slightly higher price I was told but I said no. When it came to signing the order form, I was soon concerned about additional costs and making sure to total Out the door price was going to be what I was quoted, I missed some info on the order sheet that might hurt me. There was no year specified for the model I wanted, no order number, nor were all the codes and price quotes for options filled in. I was told it would take 2-3 months for the special ordered vehicle to arrive and left a deposit in check form which I'm sure they already cashed.How will I know if the car "delivered' is really a 2005 let alone the options did not come out of another car? I feel so stupid... please.. help me. What can I do at this point if any to make sure I don't get burned when they call me back in to sign papers upon delivery?? HELP!!

dbauer · January 2005

see my reply in the dealer tricks forum.

Kirstie_H · January 2005

Since the member posted the message in multiple locations, those posts have been deleted - not really an appropriate discussion for our Forums anyway.

isellhondas · January 2005

I can't see how it could NOT be a 2005 model since they quit building 2004's months ago.

Just take your paperwork back to the dealer and have them go over it with you. If you are still uncomfortable, cancel the order.

mseenviro · January 2005

Terry and the other car experts on here,

I am about to make a job change that will involve a lot of highway driving. I won't be doing field work anymore, so I am going to get rid of my 2002 Ford Explorer.

My budget is for a used "road" car. I am thinking of the following cars, in no particular order:

2002-2004 Nissan Maxima

2000-2003 Toyota Avalon

2001-2002 BMW 525

My needs are decent milage, reliability, good road feel, and over all comfort for the hours of windshield time.

My budget will be up to $30K, before my trade. I realize I can get a Maxima and Avalon for less than the Beamer, but there seem to be a good supply of 2001-2002 525s with less than 50,000 miles for around than $25,000.

I would appreciate your imput or ideas of other cars I should consider.

typhon1991 · January 2005

danfl is right a dealership is usually 3 seperate business in one sales, service, and parts, and sometimes a bodyshop. Granted prices are lower through internal prices but not by much. So when we take in a trade with problems, you can't use the line "well it won't cost you anything to fix."Our internal labor rate is $72 per hour instead of $90. big deal.
And on your "professional" comment. There are good people and bad people. I'm sure everyone in your profession is a perfect citizen. You are in America if you don't like the way you are treated leave. Like I have said before through my experience, 90% of the people in the car business are honest people trying to make a living and raise their families.(believe if you want but it is true)
The problem is cars depreciate so much that people think they got screwed on a deal when they really didn't. Sales people get paid a percentage of the profit over invoice. Not holdback or all the other mystery money people say we have. Customers normally make the car buying process difficult not the sales person.
Just my opinion. I'm entitled.

mirth · January 2005

Since I own a '02 Max, I'm biased, but I say get the Maxima. The '02-'04 have a 255HP engine and the GLE is pretty plush. I get about 25-26 MPG highway, 21 MPG overall.

The Avalon would be a good cruiser, but absolutely no excitement. The BMW is a nice ride, but I'd be worried about expensive maintenance costs.

dbauer · January 2005

this is out of the blue, but it will keep you under $30k and get probably the best "comfort" car out there.

2003 lincoln town car with under 25k miles can be bought for $22k-$23k.

or

2005 ford 500 SEL can be bought for around $25k brand new.

isellhondas · January 2005

I would forget the BMW. Repair costs will eat you alive and when you go to sell it you'll find out that high mile BMW's are saleproof!

mseenviro · January 2005

I thought about the Lincoln LS (I'm too young for a Town Car!) and it looked like an option, but I'm looking for reliability and my thoughts were that a Nissan, Toyota, or BMW (and maybe an Acura) would be more reliable.

Thanks

mseenviro · January 2005

That is the way I'm leaning. I really want a little excitement to make the miles pass. The Avalon rides really well, reminds me of a Lexus.

I'm still in the inquiry, but this helps.

Thanks,

Mike

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