# Any ants buy a new car with financing because the dealer would charge more without it, and then pay it off quickly?



## JeanOcelot0 (Dec 30, 2020)

Car Dealerships Don’t Want Your Cash—They Want to Give You a Loan


Buyers say dealerships are pushing them to borrow because they make more money that way. The hot car market is giving them the opportunity.




www.wsj.com






> Bruce Sawyer, a retiree living in North Carolina, said that last year he was offered a $1,000 credit on his new Ford F-150 purchase if he took out a loan from Ford’s lending arm. The incentive came from the lender, he was told. He had intended to pay cash, but came around to the financing after talking with a friend who had encountered a similar deal about a decade earlier.
> 
> Mr. Sawyer took a $31,000 loan with a 6.74% interest rate, then paid it in full a few weeks later. “They said, you can pay it all off as soon as you want to,” Mr. Sawyer said. He estimates that he paid roughly $100 in interest, which was more than offset by the financing credit.





> Jacob Pyper said a staff member at Sherwood Park Volkswagen near Edmonton, Alberta, told him he had to take out a loan if he wanted to buy a 2014 Kia Soul last summer. When he said he wanted to pay cash and offered to bring in a certified check, the dealer told him they weren’t accepting cash because of the risk of fraud.
> 
> “I should have walked away at that point,” Mr. Pyper said.
> 
> ...


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## oldfart (Dec 22, 2017)

Not recently, but yes I have.


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## TheRealGnash (Jan 6, 2017)

It's not a dealer charging extra. Ford Motor Credit offers the rebate if you finance with them. They're rates are much higher, if you don't refi right away, you're better off not taking it. If you don't finance with FMC, they don't give you their rebate, Simple. Used car lots are actually trying to gank you. They mark up that finance rate and make a fortune off the crap used car and then the financing. A franchise dealer's captive finance arm sometimes offers a rebate to use them. Ford does it alot on F150. I've seen GM do it with GM Financial, but not lately.


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## Evergreen State (9 mo ago)

Yes, car dealerships make money when the customer finances a car. Car dealerships also make money when they sell you extra stuff like warranties. Since cars are rare these days, dealerships can tell you that they will not accept your check. They will accept a down payment, but they will not accept a check for the whole thing. So you could put a down payment and then immediately pay off the car. Extended warranties can work sometimes so you can buy them if you want. For example if you buy a Jeep Wrangler, it makes perfect sense to buy the extended warranties for it. But I don't think there is a need to buy extended warranty for a Honda Civic and Toyota Corolla.

By the way, most of us cannot write a check to buy a car. At least I can't. If you are in a position to write a check for a brand new car, then you're pretty good financially. Good job!


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## UberBastid (Oct 1, 2016)

I had a dealership rip me off once, legally, and I never forgot it.

I bought a car from them a couple years later. I told the guy during negotiations that I had bad credit, and didn't expect much better than two or three points above market rates - I was more concerned that I could finance it.
They took the bait. Worked out payments 3% above what I knew I could get. 
But, I ground them on the price of the car. They figured they were going to make bank on the loan, and so let me have the car for below market value.
The very next day I took the contract to my Credit Union. 
LoL
The payment was $70 lower, so I financed it with them.
The dealership got a check within a week for the full contract price.

I got a call from the sales mgr. She was PISSED that I did that. Said, it wasn't legal. Said I had to bring it back and rewrite the contract. They were going to hook the car. All kinds of threats. I basically told them to come get it if they can. 
Never heard anything else about it.

Got a low price AND a low interest rate.


..


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## Hexonxonx (Dec 11, 2019)

Evergreen State said:


> Yes, car dealerships make money when the customer finances a car. Car dealerships also make money when they sell you extra stuff like warranties. Since cars are rare these days, dealerships can tell you that they will not accept your check. They will accept a down payment, but they will not accept a check for the whole thing. So you could put a down payment and then immediately pay off the car. Extended warranties can work sometimes so you can buy them if you want. For example if you buy a Jeep Wrangler, it makes perfect sense to buy the extended warranties for it. But I don't think there is a need to buy extended warranty for a Honda Civic and Toyota Corolla.
> 
> By the way, most of us cannot write a check to buy a car. At least I can't. If you are in a position to write a check for a brand new car, then you're pretty good financially. Good job!


I bought a 2022 CR-V hybrid touring in October. I paid cash for the car and wrote a check for the entire amount. They did a credit check because I was paying with the check. Total out the door was about $43,000.

I then sold my 2019 CR-V to Carmax for $32,200 and got a lot of my money back for the 2022. I had also paid off the 2019 CR-V.


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## FLKeys (Dec 27, 2018)

Always ask for all the options, my last car I took a 7 year loan with a higher interest rate to get the best bottom line price. Just make sure there are no prepayment penalties. Also something I learned from my last purchase, banks are limiting how much you can pay online per month. I ended up driving 300+ miles to Orlando, the nearest branch, and paying off the car loan in person.


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## Hexonxonx (Dec 11, 2019)

FLKeys said:


> Always ask for all the options, my last car I took a 7 year loan with a higher interest rate to get the best bottom line price. Just make sure there are no prepayment penalties. Also something I learned from my last purchase, banks are limiting how much you can pay online per month. I ended up driving 300+ miles to Orlando, the nearest branch, and paying off the car loan in person.


Last May, I had bought a 2019 Accord Sport. I like the car but after a few months, wanted to sell it to buy another Accord with more features since the sport model is actually a model missing much of what I wanted. It was financed through Mechanics bank. They had a limit to how much I could pay online and there was a stipulation that I could not transfer the title to a third party which mean that I could not trade it in.

As soon as I sold my house last October, I paid it off by sending in a check. Got the title a full month later and trade and sold it to CarMax for $8,000 more than I bought it for.

The Accord hybrid EX-L that I bought in December is financed through Honda and they have no stupid stipulations and I can pay to off anytime. I had a CR-V that was financed through them as well a few years ago. I have 1.9% financing on my Accord with my 630 credit score.


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## Markisonit (Dec 3, 2014)

I purchased a 2011 VW Sportswagen TDI last July. Told them they would get the financing(a huge moneymaker for them) to get a better price. 2 months afterward I paid it off. I think the total I paid in interest was < $100; far less than what I saved on the car by financing.


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## Markisonit (Dec 3, 2014)

Evergreen State said:


> But I don't think there is a need to buy extended warranty for a Honda Civic and Toyota Corolla.


My daughter bought a 2018 CIvic new off the transport truck. Upon my encouragement, she purchased the extended warranty along with the factory warranty. Many issues with the car but the warranty has more than paid for itself for some expense repairs including axle seals and other high dollar repairs.
An extended warranty gives peace of mind and in this case, it paid off.
The best warranty to get is to purchase a certified used car that comes with a great warranty already and extend that out to as many miles as you can. It will cost you a few $ but that is the best warranty value out there.
One a/c job or transmission failure (yes it can happen on Honda and Toyota) and the warranty more than pays for itself.


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## Hexonxonx (Dec 11, 2019)

I bought a 2022 CR-V hybrid in October and paid cash. Two months later, I bought a 2022 Accord hybrid and financed. They gave me 1.9% financing through Honda. I paid it off Thursday after only making 4 payments.


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## Heisenburger (Sep 19, 2016)

JeanOcelot0 said:


> Car Dealerships Don’t Want Your Cash—They Want to Give You a Loan
> 
> 
> Buyers say dealerships are pushing them to borrow because they make more money that way. The hot car market is giving them the opportunity.
> ...


These salespeople are ****ing morons, aren't they?! Next thing they'll tell you not to make payment on your new loan because the lender will assume it's fraud and just send the cops to your house.

Idiots!


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## Heisenburger (Sep 19, 2016)

JeanOcelot0 said:


> Car Dealerships Don’t Want Your Cash—They Want to Give You a Loan
> 
> 
> Buyers say dealerships are pushing them to borrow because they make more money that way. The hot car market is giving them the opportunity.
> ...


Banking on the uninformed.

This is why I don't play dealer games. Ever.


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## Hexonxonx (Dec 11, 2019)

Heisenburger said:


> Banking on the uninformed.
> 
> This is why I don't play dealer games. Ever.


The only reason I financed a car for the four months I did was because of the 1.9% financing. I've never had financing that low for poor credit.


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## FLKeys (Dec 27, 2018)

0% Financing and low interest financing rates are built into the price of the car. They give you low interest rates and charge more for the car.

Ever notice those offers 0% financing *OR* $5,000 off offers? Most often you are better off taking the $5,000 off and passing on the 0% financing. If you qualify for the 0% financing you most likely qualify for a low enough interest rate some where else that cost you less than the $5,000 off. Dealerships want to talk about monthly payments instead of the total cost for a reason, they want to make the most money from post sales incentivies.


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