Any Questions for a Car Dealer?

drrotwang · July 2002

Are all parts of the tranny covered by limited warranty on new cars? If not what parts are not covered and why?

traindriver · July 2002

Take a look at this info. and please try to shed some light as to why a dealer would process a bill of sale using such outrageous figures:
---Traded a 01 Mazda Tribute, stock LX package, sand color, 28K for a new 02 Chrysler T&C eX.

Cash sale price: $28,811
Trade value: -18,442
difference =10,369
SC sales tax + 300
New tag + 29
Total cash price =10,698
Plus Payoff +10,877
Balance due OTD =21,575

Now, what seems odd to me is that the MSRP/sticker price was $27,785 SO WHY WOULD YOU SHOW 28,811???? Yes, the trade value was WAY high (18442) for a vehicle that stickered at +/-
21,500 in August 00. During negotiations the only price that we discussed was the OTD price, so dollars and cents wise it really doesn't matter to me what the BOS says but I am simply curious as to why you would use such bogus, overinflated figures just to get back to the agreed upon OTD price???
Is it for book/tax purposes, in my instance, to show a BIG profit on the new car side and when the trade is finally sold to show a BIG loss on the used car side? I understand that you can either go high trade---high new price or low-trade---low new price. Obviously with me we went high--high. Many of my car trades have been billed out using this Enron math--what gives??

tboner1965 · July 2002

I suspect to get to a certain percentage down payment.

Your down payment was about 25% of the 28.8K or $7236 (28.8K - OTD price, just for sake of argument)

Let's drop both numbers by 2K, so 2K less for the vehicle and 2K less for your trade.

So now we have (26.8K - OTD) price or about $5236 down, and as a percentage that is about 19% down.

There might be a big break in the finance rates at 20 or 25% down. I won't open the can of worms about who gets the break, the dealer or you, oops

But that is one reason the numbers are juggled. Yes, a magic 5% just because they over allowed on the trade.

I do suspect there is a point where you can't get away with that. Otherwise, they would just add $1million to everything. They everyone puts about 99% down, LOL. (Example, Chrysler cost 1028811, trade allowance = (1018442 - Payoff) = 1007565 down or over 95% down 8^) )

Now you know why the NADA, Edmunds, KBB trade numbers are so outta wack. I'm sure there are a lot of over allows in the data.

TB
Not a dealer, but learning everyday.

brianw220 · July 2002

A dealership doesn't want to show the bank a negative down payment. So, on paper you raise the new car as well as the used car to cover the payoff which is added back after taxes are figured. You could lower or raise each figure by 2,000 and the difference is still 10,369. It has nothing to do with the percent down. The lender is still advancing 21,575 no matter how you look at it. Lenders just don't like to see a figure in parentheses on that down payment line.

traindriver · July 2002

OK, I see how the down payment thing could ring true in some instances. However, the dealership did not do my financing. They could not beat a tax deductible 5.88% rate offered by my banker. Assuming the Mazda was worth 15,300 (offered by the local Ford dealer on a Mountaineer) and my payoff being 10,8XX, I can't see the down payment percentage being a factor as I rolled that "equity" into the new van. Seems like borrowing 21,5 on a 27,7xx vehicle would be O.K. as far as the loan-to-value at the bank goes.....or am I looking at this wrong???

traindriver · July 2002

Forgot to mention,
as far as the down payment percentage in relation to the interest rate, the 5.88 rate was what the banker offered over the phone. At that time he had no idea what I was going to buy or how much $$ I wanted, etc. The banker knows me by name and having done several autos, etc. with him he knows that my credit is good so I am sure that I could have borrowed 100% and it would not have been an issue. Thnaks for your comments and thoughts!!!

raybear · July 2002

Peoplefirst is 5.49% and they link right off of Edmunds.

traindriver · July 2002

Peoplefirst has excellent rates. My truck is financed through them and I have been very pleased. (something like 6.75 on a 1994 model last year----local banks can't touch that on something that old.) However, my 5.88 rate is tax-deductible so I am guessing the rate after taxes is in the high three--low four % range. Tough to beat that unless the manufacturer has special financing which was not available on the particular model van that I purchased.
Otherwise, Peoplefirst would have been my second choice.

poorbuyinewbie · July 2002

I am working toward financing and insurance today on a 1999 chevy prizm.
It has 29,000 miles on it.
Here is the deal:
the price is down to 8,600
including everything (tax etc.)
we get to 9222.
Now I am pushing for a warranty which will be 1445.
I have 2 questions. Is this a really good deal?
ok more than 2, lol. How much should this be with financing? I am working out 7.5 as my bank will offer me that, so I wont go over it.
Does the warranty get financed in?
If you can help me figure this out, I would be greatful. It will help me to know if what I will hear today is good or what.
I might get a car!!!!
I have been without one for 2 years, please send me good news! hehe.

poorbuyinewbie · July 2002

my credit rating ranges 660-735.
thanks!

robr2 · July 2002

Ok - I'm magically tansfixed.

I've been considering a 9-5 Linear Wagon. Dealers around here listed in the paper yesterday anywhere from $9-10K off MSRP for one with premium package. This brings it to about $27K.

I usually keep cars for 4-5 years and put around 15K annually. Bill - you always say lease em or buy em used. I've never leased but feel at 15K I'd get killed even with prepay on miles. I'm pretty picky on buying used so I prefer new.

After 5 years would I have nothing to show for all my money? Or should I just wait to see what the Mazda 6 is like or consider an A4 Avant/V70?

Oh and uhmm I'd like to get a stick.

brianw220 · July 2002

That is a very wide range of score, can you be any more specific. A 660 is about 3 rate tiers different than a 735 depending on lender.

raybear · July 2002

Try the peoplefirst link here at Edmunds for a rate.

auburn311 · August 2002

So I figured with all the dealers that post here surely you guys would be the one's to ask. I am going to be selling my current car and buying a new one...not necessarily in that order. It's rather complicated so bare with me.I am selling my '99 Explorer I've had for 4 years. The thing is it is titled under my dad's name (obvious insurance purposes since I am now 23, but was 19 at the time of purchase). I will be selling the car myself, but the fact that it is in my dad's name presents my problem. My dad has given me the title to the car and has signed it so I can tranfer it to my name...which is what I had planned on doing this month until I started seeing what good rebates were being offered on 2002 model Explorers. The insurance on the car expires Sept 15. That is also when I must renew my tag. So, I am trying to sell the car before that date so I don't have to pay ad-velorum taxes twice (on new and old cars) and get insurance for how ever long it takes me to sell the car. I don't need the money from the car sale for my new car, so I'll probably be buying it before I sell my old since I have the cash to pay the difference after rebates and special pricing (x-plan). Hopefully it won't be a problem to sell before Sept 15th and all will be well. The question is what do I do about the title. Since it is already signed do I just have the buyer sign it and that's it? Or do I need to tranfer it to me before I can transfer it to the buyer? It wouldn't be a problem for my dad to sign off on the deal except for the fact I now live 4 hrs away from him. Also what should I do aout the bill of sale since he will have to sign that also. Do I have him sign a blank Bill of Sale? I'm probably making this way too complicated but that's why I'm asking you guys. Sorry for the rambling.

qwalls · August 2002

As long as your Dad's signature was notarized, just take it to your local BMV and get a title in your name. Then whan you sell it, you'll sign that title over to the new buyer.

auburn311 · August 2002

But in GA I think the plates go with the original title holder not the car. So then wouldn't I have to get new plates just to sell the car and new insurance? Of course I have 30 days to get new plates, but I'd still have to get insurance wouldn't I? I'm confusing even myself.

qwalls · August 2002

I'm in Ohio, and the plates do belong to the owner, however they can be transferred, but you'd need your Dad for that. If the insurance is in your Dad's name, you would need your own. I'll leave any future questions to a professional. Good luck.

xo247 · August 2002

Hello,
I'm planning to buy a used car for the first time..in the $10,000 price range(+/- 2000k).
I'm mostly looking at maxima's, camry's , and maybe galants, nothing hard to find.
How much off the dealer's asking price should I realistically expect to get?

For new cars, anything close to invoice or 10% seems like the general rule. Used cars have much more variables with mileage, year, condition, etc.

I don't want to get a bad deal, but also don't want to start off negotiations with an absurd discount request. Thanks in advance.

steine13 · August 2002

How much a discount to ask for?
Impossible to tell, depends on the dealer as well as the car. And how long they've had it (Carfax is your friend here). $2000 off asking price may still be to high in some cases, but Bill once said about ad prices in the newspaper: "I don't spend $$ to advertise my second-best price". Meaning, of course, that once he advertised a price on a car, there was little room to dicker. Others agreed, but some dealers in my town still advertise sky-high prices. No rules of thumb apply, I think.

Best to find a car you like, ask nicely in real-world trade-in values, then write "$xxxx + TTL" on the buyer's order and let the chips fall... Oh, and FWIW, my independent mechanics ALL hate to work on Nissan cars...

Good luck, let us know,
-Mathias
East Lansing, MI

masspector · August 2002

When do car salesmen hate to do a test drive the most? In the heat of the summer, the cold of the winter, or when it is raining?

sbell4 · August 2002

5 minutes til closing. I wish I could just ask these people that show up at closing time, "WHERE HAVE YOU BEEN ALL DAY? Come back tomorrow, the car isn't going anywhere.

masspector · August 2002

Isn't there an old buyer myth that if you come in at closing time that you can work a better deal, because the salesman wants to go home?

landru2 · August 2002

Does anybody here in the business have anything but contempt for someone that wants to start the process at closing time?

firemedic1969 · August 2002

What can I expect to save off MSRP on end of year vehicle model sales??

raybear · August 2002

What car and where are you shopping?

rroyce10 · August 2002

.... Closing time, isn't that a fact ...!

l..o..l..

Terry.

karz10 · August 2002

is that what you say when the faded copy of a fax hangs on the wall in the cube behind you says

the car you want to think about today is the same one someone else thought about yesterday is coming back to buy today

or some such thing....lol i'm just kidding of course

karz

firemedic1969 · August 2002

Northern New Jersey. Looking at Honda CRV or Mazda Tribute. Leaning toward Tribute.(No bashing on choices please). Looking to finace through dealer for 5 years. My bank can do 7% interest right now. Mazda is 4.9% per web site but dealers have said 5.4%. Honda dealerships are comperable in finacning but locally i've been told there is an 8 week waiting list for new CRV's.

bretfraz · August 2002

Northern New Jersey. Looking at Honda CRV or Mazda Tribute. Leaning toward Tribute.(No bashing on choices please). Looking to finace through dealer for 5 years. My bank can do 7% interest right now. Mazda is 4.9% per web site but dealers have said 5.4%. Honda dealerships are comperable in finacning but locally i've been told there is an 8 week waiting list for new CRV's.

And you're question is......

BTW, sounds like you're getting ripped all the way round. Mazda dealer is padding your interest rate; go to Peoplefirst.com or eloan for better new car rates than your bank; plenty of CRV's on the ground all over America so keep shopping.

isellhondas · August 2002

CRV's are in very short supply, at least in my neck of the woods. 8 weeks does sound a bit long though.

Mazda on the other hand has lots of Tributes to sell.

That's all I'll say...:)

nyccarguy · August 2002

Bill

I know that you (and Terry) are big purveyors of used cars and that's what the "smart shopper" should be looking into. I've read that you've said to buy used and hold on to the car for 2 years. The obvious benefit to owning a used car is the fact that someone else took the depreciation hit. Also by trading up every 2 years to a new used car, your cash outlay is minimized (on a depreciating asset). My question is, are you saying to buy a 1 or 2 year old car and hold onto it for 2 years or buy a 3 or four year old car and hold onto it for 2 years? Can you give me some real world examples using vehicles on the used market (Honda Accord EX-V6 and BMW 3 series)?

rroyce10 · August 2002

..... That all depends on the vehicle, and what a buyer is looking for ...

A good example is a 00 Volvo S80 -- loaded up new, around $41 .. 2 years later, $25/26ish. This vehicle has been sittin' around that price for almost a year .. that's a Good purchase. Take a nice, clean Lexus 99 GS300 .. a year ago, doing $32ish, a year later they are doing close to that ..

Honda's, they get to a certain price .. and kinda hover around. Bimmers, a 99 328i are not much less than a couple of grand or so, from last year ..

I guess the point is, not many folks can afford a $40,000+++ vehicle .. but a ton, can afford a $29/$25/$21,000 vehicle .. if it's a nice clean, low mileage "baby doll", that dog will hunt for a huge market.

I hope this makes sense ...

Terry.

raybear · August 2002

Jim, I asked one of the guys I work with and he thinks the Tribute can be had a bit over invoice and the CR-V just a bit under MSRP.

isellhondas · August 2002

Well...good luck finding a CRV for that although it's possible depending on that particular marketplace.

Why not a Ford Escape? Same car and maybe a better price?

raybear · August 2002

The Escape may be more readily available than the Tribute, the CR-V is around but not exactly gathering dust on the dealers' lots, which explains the nominal discounting.

tboner1965 · August 2002

Mazda's warranty is a bit better at 36/50K vs 36/36K for the Ford.

The Tribute suspension is tuned a bit more sporty than the Escape.

I'd choose Tribute over Escape, but your criteria may differ.

TB

firemedic1969 · August 2002

Those attributes exactly. And when I was doing my inital information gathering Ford had nothing going as far as financing. Now it's a little different. As for my choice of vehicle I have to buy due to commuting (and the Trib gets such great gas miliage...Not) but I have a Job where I absolutely must be able to get to work ie:mini-suv. CRV gets better gas miliage but I just like the Tribute. Looks more like a truck than a boxy thing on Wheels. Thanks for the input.

rroyce10 · August 2002

.... In the long run, I think you will be better off on the Tribute. They do drive a little different than the Escape and they "seem" to be finished off a little better.

But the "real deal" is, at trade time, they will be worth a little bit more than the Escape .. based on todays market, there is a $1,500+ difference between the two. Try going after the ES, the more loaded they are, the more they are worth and trade or sale time.

Terry.

nyccarguy · August 2002

I'll agree that the Tribute is styled a better than the CRV, but I'd still stake the CRV over the Escape or Tribute. It will definitely be easier to sell privately and it has a great little 4 cyl engine that pretty much matches accleration of the Ford's 200hp V6. One of the magazines recently tested an Escape/CRV/VUE and picked the Escape by a slim margin. They mentioned available leather, a better 4WD system (more transparent), and a higher towing capacity as the reasons they chose the Escape over the CRV. Are the Escapes still having recall & QC issues?

nyccarguy · August 2002

You do make a valid point (as always) with a car like the Volvo S80 as does Bill when he speaks highly of the value of a used Saab 9-5.

You're saying that if you're going to buy new, then lease, otherwise buy used.

Forgive me for being skeptical, but I know some very shady characters (who put a switch in their car to shut off the odometer so the miles don't accumulate as fast). This one guy bought a 2001 BMW 330CiC fully loaded to the gills. He installed the switch in his car so the miles don't appear to accumulate. He has the car detailed once a week and put brand new tires on it. He traded it in and the car had something like 45,000 miles on it. It showed 3000 miles. How can yopu prevent this?

rroyce10 · August 2002

..... If I understood my Tech correctly, the Xtra miles won't show -- But, as soon as it hit's a BMW service dept, the TRUE miles will get picked up by their computer, whether it's now or in 20 months ...

At that time, the vehicle goes TMU .. which is a law suit waiting to happen, even if you sell the vehicle, private .. .. It's not nice to try too fool "Mother Nature" -- ..l.o.l..

Terry.

nyccarguy · August 2002

Oh, I agree it is WRONG to do and again this is somebody that I know. He actually has his bases covered that way too. He gets the oil changed and all the service done at an independent shop so the car never sees a BMW computer until it is too late!

rroyce10 · August 2002

....... Oh, I understand what he is doing .. l..o..l...

But, sooner or later he will trade the vehicle in .. someone, somewhere, will pull into a Bimmer Dealer and have some work done "under warranty" .. and when it get's picked up, the Dealer will just paper trail it -- and Wango Tango, someone is going to court for fraud --

We went through this about 9 months ago, a customer sold it to us in FL, customer lives outside of Charlotte, tried to grab us for the mileage "question" .. we took it to BMW, they found the true mileage from the service work through them -- right now, they have to come up with $4,727.89 or they get to wear those pretty little silver cuffs, thats via the Judge -- sooner or later, either by registration, safety check, state inspection, etc. it catches up -- kinda remember, it's like Enron, 2 sets of books ...

Terry.

cfg1 · August 2002

Wouldn't an appraiser be able to tell a 3,000 mile car from a 45,000 mile car?

mark156 · August 2002

Because of shady characters.......That's why I buy brand new. Unless you know the owner and how the car was serviced, I wouldn't risk the headache that's just around the corner.

Just my opinion.. M.

rroyce10 · August 2002

..... That's what I would be thinkin' ...

Perhaps "telling" a story to Nyccarguy - was more fun than the real story ..l.o.l..

Terry ;-)

dorene2 · August 2002

I read in an earlier post regarding a customer quoting a 4.9% interest rate from an internet site and a 5.4% at the Mazda dealer. I was just quoted a 4.9% rate from a Toyota dealer on a 2003 Sienna. Do you think there's better? Also, the dealer noted that she doesn't know if it will apply after September 3rd and my car is due in second week of September. Do I have any recourse? Or should I apply through the net and have a back up??? BTW I am leary about net financing.

godeacs · August 2002

have you checked at a local credit union? You should be able to get around 5% or so. Or the dealer may have a "tie in" with one. Mine got me a better rate with my CU than I could have gotten on my own!

BTW, I would be leery of internet financing too...

force98 · August 2002

In BMWs, the on-board computer also maintains odometer mileage, separate from the odometer. This way, if the dash panel is replaced, the computer senses it. You will see a very noticeable red dot next to the odometer readout if the computer and odometer readings don't match.

mackabee · August 2002

What neck of the woods are you in? Here in my neck of the woods the best any credit union can do is 4.9% on new vehicles for 48 months, not the 4.9% for 60 months that Toyota is offering on the 2003 Sienna.

: )
Mackabee

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