Author Topic: Ridiculous Things Dealerships Say and Do  (Read 35212 times)

QueenAlice

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Ridiculous Things Dealerships Say and Do
« on: December 23, 2016, 07:55:09 AM »
I was at a car dealership recently (to turn in my VW TDI as part of the buyback program) and the place was PACKED. There was a VW dealership and a Honda dealership side by side and both were filled with people buying cars. I was talking to one of the sales people and asking about how car sales differ in December vs other times of the year and a few ridiculous pieces of info came out of the conversation:

1. Some of the financing companies they use allow them to finance up to 170% of the car value they are selling

2. Their default loan length when you ask about rates is now 72 months and they are willing to go up to at least 120 months (See item 1)

But this last one...
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.
Down the rabbit hole

"Why, sometimes I've believed as many as six impossible things before breakfast."
-- Red Queen, Alice's Adventures in Wonderland - Lewis Carroll

ender

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Re: Ridiculous Things Dealerships Say and Do
« Reply #1 on: December 23, 2016, 08:05:19 AM »
When we looked a a car the dealership ran numbers and used 10% as the interest rate (lol) - but we asked, it turned out that was the average rate people got...

:/

slugline

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Re: Ridiculous Things Dealerships Say and Do
« Reply #2 on: December 23, 2016, 10:52:15 AM »
But this last one...
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.

LOL -- surely they were supposed to be told that the dealership needed to empty their lots to lower their inventory tax hit, but it got very lost in translation. :)

MilesTeg

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Re: Ridiculous Things Dealerships Say and Do
« Reply #3 on: December 23, 2016, 11:10:48 AM »
Buy this 7 year/125k extended warranty for $Yk, it's totally worth it even though you have a manufacturer warranty that covers 10/100k years. It covers everything!


Playing with Fire UK

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Re: Ridiculous Things Dealerships Say and Do
« Reply #4 on: December 23, 2016, 11:21:09 AM »
But this last one...
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.

LOL -- surely they were supposed to be told that the dealership needed to empty their lots to lower their inventory tax hit, but it got very lost in translation. :)

I see why the dealers would start the rumour that you get a giant tax hit if you have money in your bank account at the end of the year.

Playing with Fire UK

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Re: Ridiculous Things Dealerships Say and Do
« Reply #5 on: December 23, 2016, 11:25:40 AM »
1. Some of the financing companies they use allow them to finance up to 170% of the car value they are selling

So all those people who think that they are doing great because they have rolled the old loan into the new one are really financing 170%. And presumably that is the car value at the sticker price before the customer drive it off the lot and the value becomes 60% of that.

How are they approving this nonsense?

meghan88

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Re: Ridiculous Things Dealerships Say and Do
« Reply #6 on: December 23, 2016, 12:00:55 PM »
The car dealership was shocked and awed that we paid cash (7K) when we bought our subcompact after taking over a lease on it from someone who was moving overseas.  They asked if we'd gotten better financing than what they could offer and told us that we should seriously consider financing it through them.

Anyway it's nice to see the following type of article from Business Insider:

http://www.businessinsider.com/car-payment-keeps-you-from-building-wealth-2016-12?utm_medium=email&utm_source=flipboard

JAYSLOL

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Re: Ridiculous Things Dealerships Say and Do
« Reply #7 on: December 23, 2016, 12:34:53 PM »
I actually got pretty angry the other day when i checked the mail and there was an ad from the local Dodge dealership that went like this

"COULD YOU USE AN EXTRA $12,500 THIS CHRISMAS?  GET UP TO $12,500 CASH WITH YOUR NEW RAM 1500!"

How the f#$k do these people think this is an ok thing to promote?  Yeah, buy a $25k+ truck so you can get another $12,500 on credit and be underwater on a completely unnecessary auto loan for the next 8 f#@king years.  Damn it, i'm getting angry again. 

mm1970

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Re: Ridiculous Things Dealerships Say and Do
« Reply #8 on: December 23, 2016, 12:50:02 PM »
oh my god

Cpa Cat

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Re: Ridiculous Things Dealerships Say and Do
« Reply #9 on: December 23, 2016, 12:53:04 PM »
After graduation from my Master's program, I thought I would reward myself with a new car. I called ahead, told them what car I wanted to look at, told the guy to have it ready... and when I went there for my appointment, that guy was nowhere to be seen, no car was ready to drive and the new salesman decided to waste my time by selling me a car. Instead of starting with the car I walked in there to buy, he sat me down and started asking me what payment I could afford.

My response was essentially: "Wut?" I had been prepared to pay cash, so this backwards way of thinking didn't compute for me. I said: What terms can you offer me? It was hard to shake him off his script, though.

Then he asks, "What's wrong with your current car?"

I just stared at him and then said, "Nothing. It's old. I wanted a new one. But now that you mention it, I guess that's silly. I'll keep driving my old one." And I walked out. I ended up not buying a new car for 5 more years.

I wrote a newsletter about how buying a truck in December can save business owners on their taxes (trucks weighing more than 6,000 lbs have favorable deduction rules), which is great because you can combine it with debt-financing and year end sales and get a smoking deal on a truck. Sure, you have to pay for it eventually, but whatevs.

This topic ended up being my most popular post ever on my silly tax blog - it got probably 20 times more views than anything I've ever written about before. I got five phone calls from clients who read the newsletter and wanted to discuss this BUY TRUCKS tax strategy. I feel oddly guilty about it.

Playing with Fire UK

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Re: Ridiculous Things Dealerships Say and Do
« Reply #10 on: December 23, 2016, 04:39:05 PM »
Instead of starting with the car I walked in there to buy, he sat me down and started asking me what payment I could afford.

My response was essentially: "Wut?" I had been prepared to pay cash, so this backwards way of thinking didn't compute for me. I said: What terms can you offer me? It was hard to shake him off his script, though.

Then he asks, "What's wrong with your current car?"

I just stared at him and then said, "Nothing. It's old. I wanted a new one. But now that you mention it, I guess that's silly. I'll keep driving my old one." And I walked out. I ended up not buying a new car for 5 more years.

I love this response!

CopperTex

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Re: Ridiculous Things Dealerships Say and Do
« Reply #11 on: December 23, 2016, 05:40:11 PM »
In August, I went to purchase my Camry that was coming off lease. The guy says, "Hey now, what would you say if I told you I could get you a new one for less money". I said "Oh really? You can get me a new one for less than the $14k I'm buying this one for?". He went red in the face and stammered, "Um...no...I meant the payment". His reaction was if he had never had someone call him out on the price being more than just the payment. He then continued to pout and wouldn't look us in the eye the rest of the time we were there.

Paul der Krake

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Re: Ridiculous Things Dealerships Say and Do
« Reply #12 on: December 23, 2016, 05:50:24 PM »
I wrote a newsletter about how buying a truck in December can save business owners on their taxes (trucks weighing more than 6,000 lbs have favorable deduction rules), which is great because you can combine it with debt-financing and year end sales and get a smoking deal on a truck. Sure, you have to pay for it eventually, but whatevs.

This topic ended up being my most popular post ever on my silly tax blog - it got probably 20 times more views than anything I've ever written about before. I got five phone calls from clients who read the newsletter and wanted to discuss this BUY TRUCKS tax strategy. I feel oddly guilty about it.
That's effin' hilarious. What's your blog? Or other tax blogs worth reading?

LiveLean

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Re: Ridiculous Things Dealerships Say and Do
« Reply #13 on: December 23, 2016, 05:52:57 PM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.
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Indexer

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Re: Ridiculous Things Dealerships Say and Do
« Reply #14 on: December 23, 2016, 06:26:34 PM »
I read a sign in a dealership once that said,

"Why would you choose to own a depreciating asset?"

Before you all get excited the sign finished with...

"Lease it instead!"

That was the sales pitch for leasing.

meghan88

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Re: Ridiculous Things Dealerships Say and Do
« Reply #15 on: December 23, 2016, 06:27:41 PM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.

Too funny or too sad.  Maybe both.

MrsPete

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Re: Ridiculous Things Dealerships Say and Do
« Reply #16 on: December 23, 2016, 07:06:50 PM »
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.
Oh, sure -- excellent advice.  Similarly, you should keep a mortgage for the tax break! 

Thing is, some people don't know any better.  Others are looking for any excuse to allow themselves to be "talked into" buying a new car.   

solon

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Re: Ridiculous Things Dealerships Say and Do
« Reply #17 on: December 23, 2016, 07:10:57 PM »
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.
Oh, sure -- excellent advice.  Similarly, you should keep a mortgage for the tax break! 

Thing is, some people don't know any better.  Others are looking for any excuse to allow themselves to be "talked into" buying a new car.   

But it still doesn't make sense. You DO actually get a tax break for mortgage interest.

But the government doesn't tax you on your bank balance. There is no tax hit for having money in the bank.

paddedhat

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Re: Ridiculous Things Dealerships Say and Do
« Reply #18 on: December 23, 2016, 07:32:58 PM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.

Too funny or too sad.  Maybe both.

I bought a sweet, nearly new Scion that was supposed to be $12,800 out the door. Since the salesman was waffling on the exactness of the $12.8k figure, I got tired of his games and introduced myself to the financing guy, who actually handles the details of transactions at this dealer. I explained that, if we still were in agreement, that I was heading down the street to a branch of my bank, to generate a certified check for that amount. He tried several versions of, "why would you want to use your money when mine is soooo much.......smarter, cheaper, easier, etc" I grew tired of this shit, and politely told him I was heading for the bank. His final comment was, "you're really going to do this to me, aren't you?"   He was genuinely amazed and beaten at his game, when he had to admit that a customer wasn't leaving with a loan.

ender

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Re: Ridiculous Things Dealerships Say and Do
« Reply #19 on: December 23, 2016, 08:49:43 PM »
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.
Oh, sure -- excellent advice.  Similarly, you should keep a mortgage for the tax break! 

Thing is, some people don't know any better.  Others are looking for any excuse to allow themselves to be "talked into" buying a new car.   

But it still doesn't make sense. You DO actually get a tax break for mortgage interest.

But the government doesn't tax you on your bank balance. There is no tax hit for having money in the bank.

Some trucks are tax deductible depending on whether it's a work truck or not (this is one reason you see a lot of farmer types with fancy trucks).

Travis

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Re: Ridiculous Things Dealerships Say and Do
« Reply #20 on: December 23, 2016, 09:13:06 PM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.

Too funny or too sad.  Maybe both.

I bought a sweet, nearly new Scion that was supposed to be $12,800 out the door. Since the salesman was waffling on the exactness of the $12.8k figure, I got tired of his games and introduced myself to the financing guy, who actually handles the details of transactions at this dealer. I explained that, if we still were in agreement, that I was heading down the street to a branch of my bank, to generate a certified check for that amount. He tried several versions of, "why would you want to use your money when mine is soooo much.......smarter, cheaper, easier, etc" I grew tired of this shit, and politely told him I was heading for the bank. His final comment was, "you're really going to do this to me, aren't you?"   He was genuinely amazed and beaten at his game, when he had to admit that a customer wasn't leaving with a loan.

Buying a car for cash might as well be taking food from his children you evil creature.

« Last Edit: December 23, 2016, 09:40:08 PM by Travis »

lbmustache

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Re: Ridiculous Things Dealerships Say and Do
« Reply #21 on: December 23, 2016, 09:36:53 PM »
Most dealerships are total trash. There are a few decent ones out there, but are hard to find.

My least favorite thing has to be the current ad Kia is running on the radio and tv - purchase a new car, and "no payments till Spring 2017." Way to make sure that you're even MORE underwater on a new car.

There have been several articles detailing the rise of auto loans, car payment increases (avg is somewhere around $500/mo now, IIRC), and the fact that many of the loans written are subprime. I think it's a bubble that will burst soon enough - not as catastrophic as the housing crash, but  not without consequences.

SwordGuy

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Re: Ridiculous Things Dealerships Say and Do
« Reply #22 on: December 23, 2016, 09:44:05 PM »
3. Sales in December increase because "People want to clear out their bank accounts by the end of the year so they don't take a tax hit".
W. T. F. ?!? I can't even wrap my head around this statement, and TWO different sales associates said this to me.
Oh, sure -- excellent advice.  Similarly, you should keep a mortgage for the tax break! 

Thing is, some people don't know any better.  Others are looking for any excuse to allow themselves to be "talked into" buying a new car.   

But it still doesn't make sense. You DO actually get a tax break for mortgage interest.

But the government doesn't tax you on your bank balance. There is no tax hit for having money in the bank.

I don't believe those two statements are completely true.

In the US, you get a tax deduction for your home mortgage interest if you itemize your deductions.  But unless you have a REALLY expensive house or you have a lot of other deductions that, in total, are bigger than the very generous standard deduction,  you won't get any deduction for your mortgage interest.   

And private individuals won't be taxed on your bank balance by the Feds.   But if they can buy something and classify it as a business expense, they won't pay taxes on the business income that paid for that item.   It's like getting a tax rate discount on the purchase.   Of course, that only benefits them if they needed to buy the item anyway.  Otherwise they just bought something they didn't need and didn't really save money.

Also, some states have taxes on property (and I don't mean land or cars).   I don't know whether any of them tax cash in the bank.   

Uturn

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Re: Ridiculous Things Dealerships Say and Do
« Reply #23 on: December 23, 2016, 10:22:15 PM »
I had an odd experience when I bought my Altima three years ago, about 7 months before finding MMM.  The finance guy pushed the extended warranty like he is mandated by his management, which I refused, then he started talking finance rates.  I told him it would be a cash deal.  He tells me that the rebates are only good if I finance through Nissan, at least 75% of the purchase price.  So I hemmed and hawed about taking out a loan.  Here is the odd part that I would never had expected from a dealership finance guy.  He pulls up VTSAX over the past 5 years and shows me the growth rate, says the loan is only 1%, and explains opportunity costs of 1% vs the rate of return against VTSAX. 

I did finance the car, but only made the required 3 months payments, the last one being a big one.  I understand the math, but just can't stand having a loan on something that is guaranteed to lose value. 

Last week the local Honda dealer sent me something in the mail stating that they can absolutely lower my monthly payment if I trade the Altima in for an Accord.  I've toyed with the idea of going down there and see how they can do that, just to make them work a bit.   But that would be a dickhead move, and I'm still very satisfied with my Altima. 
It's not about money, it's about mindset

mustachepungoeshere

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Re: Ridiculous Things Dealerships Say and Do
« Reply #24 on: December 24, 2016, 03:03:36 AM »
Some trucks are tax deductible depending on whether it's a work truck or not (this is one reason you see a lot of farmer types with fancy trucks).

Or tradies, but the ATO is cracking down on people taking advantage of this.

Quote
"There is a rumour that the ATO goes to the footy at the weekend and checks the number plates of all the utes because it is a giveaway that they are being used for private use."

http://www.smh.com.au/business/ato-cracks-down-on-utes-after-helping-make-hilux-a-best-seller-20160209-gmpevq.html


ChipmunkSavings

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Re: Ridiculous Things Dealerships Say and Do
« Reply #25 on: December 24, 2016, 07:39:10 AM »
I had an odd experience when I bought my Altima three years ago, about 7 months before finding MMM.  The finance guy pushed the extended warranty like he is mandated by his management, which I refused, then he started talking finance rates.  I told him it would be a cash deal.  He tells me that the rebates are only good if I finance through Nissan, at least 75% of the purchase price.  So I hemmed and hawed about taking out a loan.  Here is the odd part that I would never had expected from a dealership finance guy.  He pulls up VTSAX over the past 5 years and shows me the growth rate, says the loan is only 1%, and explains opportunity costs of 1% vs the rate of return against VTSAX. 


That's pretty impressive that he did that!

frooglepoodle

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Re: Ridiculous Things Dealerships Say and Do
« Reply #26 on: December 24, 2016, 08:09:39 AM »
The car dealership was shocked and awed that we paid cash (7K) when we bought our subcompact after taking over a lease on it from someone who was moving overseas.  They asked if we'd gotten better financing than what they could offer and told us that we should seriously consider financing it through them.

Anyway it's nice to see the following type of article from Business Insider:

http://www.businessinsider.com/car-payment-keeps-you-from-building-wealth-2016-12?utm_medium=email&utm_source=flipboard

We had a similar experience buying my car. We turned down the dealer financing offer but when we came back with the cashier's check and pick up the car the financing guy asked what rate the credit union had given us. We stared blankly until it registered and said they didn't.

meghan88

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Re: Ridiculous Things Dealerships Say and Do
« Reply #27 on: December 24, 2016, 04:57:14 PM »
The car dealership was shocked and awed that we paid cash (7K) when we bought our subcompact after taking over a lease on it from someone who was moving overseas.  They asked if we'd gotten better financing than what they could offer and told us that we should seriously consider financing it through them.

Anyway it's nice to see the following type of article from Business Insider:

http://www.businessinsider.com/car-payment-keeps-you-from-building-wealth-2016-12?utm_medium=email&utm_source=flipboard

We had a similar experience buying my car. We turned down the dealer financing offer but when we came back with the cashier's check and pick up the car the financing guy asked what rate the credit union had given us. We stared blankly until it registered and said they didn't.

They just don't get it.  Poor fecks who work there are probably in the same boat themselves, and are likely brainwashed.

MrsPete

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Re: Ridiculous Things Dealerships Say and Do
« Reply #28 on: December 24, 2016, 09:15:06 PM »
But it still doesn't make sense. You DO actually get a tax break for mortgage interest.

But the government doesn't tax you on your bank balance. There is no tax hit for having money in the bank.
The point: Both statements show a lack of understanding of how finances work. 

We had a similar experience buying my car. We turned down the dealer financing offer but when we came back with the cashier's check and pick up the car the financing guy asked what rate the credit union had given us. We stared blankly until it registered and said they didn't.
Reminds me of the salesperson who called me some time back:  I can get your a better rate on your mortgage ... I seriously doubt it ... What's your rate?  .... Zero; I have no mortgage ... Well, this is your lucky day; we can help you buy a house ... I own a house ... But you just said ... Yeah, I own the house -- lock, stock and barrel -- so you're not going to get me a better rate ... WHY ARE YOU YELLING AT ME? ... Huh?  I'm not yelling.  Seriously, poor guy was almost crying because he couldn't understand someone who actually owns a house.

Stashasaurus

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Re: Ridiculous Things Dealerships Say and Do
« Reply #29 on: December 24, 2016, 09:35:24 PM »
I have been sitting on this image for a while, but this is the perfect place for it.

Dealerships, where they have all your payment needs!

Travis

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Re: Ridiculous Things Dealerships Say and Do
« Reply #30 on: December 24, 2016, 11:18:07 PM »
There's a dealership in town that says on the radio "we'll find you a car you can afford, just make the darn payments." They say that in the most sincere way. It's a commercial targeted at bad credit folks who simply need a set of wheels and they dealership won't pressure them into something they can't afford.

A few years ago I was buying a new vehicle (facepunch-worthy event at the time) and the financing guy slide a piece of paper across the desk with a loan offer. I slid another piece of paper back at him with a quote from my credit union. He looked at it, smiled, and said "yep, I'm not going to beat that." I always find it amusing when you can humble or shut up a loan salesman. Last year the loan officer at the dealership for my current car was practically relieved when I told him I was paying cash. It was a ton of paperwork he didn't have to do, but I wonder if that relief was simply because we were getting near closing time.

mwulff

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Re: Ridiculous Things Dealerships Say and Do
« Reply #31 on: December 25, 2016, 02:39:35 AM »
I had a great dealer experience when buying my last car. (actually the only new car my DW and me ever owned).

Step 1. Go online, configure car as we'd like it.
Step 2. Pay a $2000 deposit.
Step 3. Get email that our order is confirmed
Step 4. Get email that our car is being produced
Step 5. Get eamil that our car is in transit.
Step 6. Get phone call to arrange pickup and registration details.

And finally show up on location, hand over cheque for the car. Get the keys and have the cellphone setup and drive home. Take a big detour and show the car to our families.

Best experience ever.

gj83

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Re: Ridiculous Things Dealerships Say and Do
« Reply #32 on: December 25, 2016, 05:49:47 AM »
I briefly dated a guy who used to be a car salesman.  I forget the conversation, but I was talking about the total cost of a car purchase.  He said no one cared about the cost, only the monthly payments.  In the 2 years he sold cars no one ever negotiated for the final price.
When I bought my last car I used the credit union's car buying program and got a 0.49% rate.  The car buying program involved a prenegotiated price.  I went to the internet sales guy at my time slot with my check in hand, drove the car, went to finish paperwork.  He still tried to convince me to use their financing.  He couldn't beat the rate.  Tried to sell me on the extended warranty since I said I was going to own it until it died.  I refused.

Fast forward a year and I started getting calls almost weekly to sell the car back and get the newest model year for the same payment.  Then around the 3 year mark I started getting weekly calls to buy the extended warranty.  I have so many phone numbers blocked.  Obviously people fall for it or they wouldn't do it.
I took out a 60 month loan and my payment was close to $500/ mo.  I had statefarm insurance for a while and the receptionist there was convinced that my payment was too high...no way a payment should be that high on their loan.  I said there was no way she could beat the payment unless it was 0% interest or they extended the term.  I'm pretty sure it was the latter.  I left that agency soon after that call because they kept jacking my home owners more than the state approved rate.
I had the car paid off around the 2.5 year mark.  Since then I haven't gotten anyone promising to lower my payments. 


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JR

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Re: Ridiculous Things Dealerships Say and Do
« Reply #33 on: December 25, 2016, 07:52:49 AM »
We bought a Honda Fit a few years ago and had a similar experience as other posters here. The car was only $9,000 yet they relentlessly pushed financing when we told them we were going to pay with a bank check. The finance guy tried to talk us into financing by telling us that is was risky for us to use our cash for the car in case of emergency. When we told him that the $9k only represented less than 3 months of net savings he looked confused and said "what are you doing buying a car like this"? And then showed us a pamphlet for some $40,000 SUV. He also tried to sell us an extended warranty and said we could finance it for 0% interest.
« Last Edit: December 25, 2016, 07:56:44 AM by JR »

Spork

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Re: Ridiculous Things Dealerships Say and Do
« Reply #34 on: December 25, 2016, 09:10:50 AM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.

Actually, you can thank the Federal government for this.  Any cash transaction greater than $10k requires a volume of paperwork.  Apparently, if you have a stack of cash, you're either a drug dealer or a money launderer.  Most businesses decided they didn't want to mess with the pain of the paperwork.
Some will sell their dreams for small desires
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Eirene

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Re: Ridiculous Things Dealerships Say and Do
« Reply #35 on: December 25, 2016, 09:13:01 AM »
I briefly dated a guy who used to be a car salesman.  I forget the conversation, but I was talking about the total cost of a car purchase.  He said no one cared about the cost, only the monthly payments.  In the 2 years he sold cars no one ever negotiated for the final price.

That was a major pain point when I was buying my car ten years ago. Took me ages to get the car salesman to quote an actual price.

He kept repeating the monthly payment amount and giving lower and lower amounts, presumably at longer terms. Very hard to convince him I didn't care about the monthly payment even though I was going to finance the car.

At the end I had to pull out an actual calculator and say 'OK give me the interest rate and I'll figure out the price and then we'll talk.'
Journal here, much easier for me to find it as it doesn't get updated often  http://forum.mrmoneymustache.com/journals/mostly-on-budget/

Blog coming soon(-ish) eventually perhaps

Dave1442397

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Re: Ridiculous Things Dealerships Say and Do
« Reply #36 on: December 25, 2016, 09:26:29 AM »
I briefly dated a guy who used to be a car salesman.  I forget the conversation, but I was talking about the total cost of a car purchase.  He said no one cared about the cost, only the monthly payments.  In the 2 years he sold cars no one ever negotiated for the final price.

That was a major pain point when I was buying my car ten years ago. Took me ages to get the car salesman to quote an actual price.

He kept repeating the monthly payment amount and giving lower and lower amounts, presumably at longer terms. Very hard to convince him I didn't care about the monthly payment even though I was going to finance the car.

At the end I had to pull out an actual calculator and say 'OK give me the interest rate and I'll figure out the price and then we'll talk.'

We bought a new Honda CR-V back in 2003 when the new model came out. The first dealership kept pulling that same crap with the piece of paper with the four squares on it, and wouldn't give us an actual price. When the guy asked us how much we could afford to pay each month, I said, "You mean, what's left over after all our other expenses? Around $2500/month." That just confused him. I gave up and we went to the next dealer, who realized instantly that we were in the Internet age, gave us a good price on the trade-in and a good price on the CR-V. Deal done and out the door within an hour.

GetItRight

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Re: Ridiculous Things Dealerships Say and Do
« Reply #37 on: December 25, 2016, 01:14:53 PM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.

Actually, you can thank the Federal government for this.  Any cash transaction greater than $10k requires a volume of paperwork.  Apparently, if you have a stack of cash, you're either a drug dealer or a money launderer.  Most businesses decided they didn't want to mess with the pain of the paperwork.

Indeed, just one more government evil. What LiveLean did is called structuring payments, so each transaction is under the limit. Making a >$10k transaction is not illegal but you may become a victim of civil asset forfeiture if you do this even when documented as the government mandates. It's just another tax, government stealing your money, but it's a hidden tax on a subset of the population. In most cases you'll spend more for lawyers trying to get your money back than you 'll get back, if you get anything back at all. It's all very arbitrary, as government violence typically it. In any event, structuring payments is a crime and I believe it's applicable to transfers over $10k in either a 30 day period or a calendar month... I forget which.

Gronnie

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Re: Ridiculous Things Dealerships Say and Do
« Reply #38 on: December 25, 2016, 02:35:42 PM »
In this case it would not be structuring. He simply did what the dealership required. Structuring requires intent.

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Re: Ridiculous Things Dealerships Say and Do
« Reply #39 on: December 25, 2016, 02:46:58 PM »
It was also $10k cash + $5.8k check.  I believe the problem is with amounts > $10k.  You run afoul if you make 1 cash payment of $10k and another cash payment of $5.8k.  That's attempting to go around the cash payment rules.  Cash+check is not.  There was not more than $10k cash, so ... it's legal with no paperwork.

But yes, it's dumb.
Some will sell their dreams for small desires
Or lose the race to rats
Get caught in ticking traps
And start to dream of somewhere
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Re: Ridiculous Things Dealerships Say and Do
« Reply #40 on: December 25, 2016, 03:44:55 PM »
When I last bought a new car in 2010, the dealer would not let me pay cash. There was no rebate contingent on financing a chunk of it. Apparently paying cash for a car had become so uncommon at this dealership that their computer system no longer allowed it -- or so they said.

The car, after trade-in, was $15,800. They said the maximum I could pay at that time was $10,000. They said I could pay the rest on my second visit.

So I stroked a check for $10,000, drove the new car to lunch, then returned and paid $5,800.

Unbelievable.

Actually, you can thank the Federal government for this.  Any cash transaction greater than $10k requires a volume of paperwork.  Apparently, if you have a stack of cash, you're either a drug dealer or a money launderer.  Most businesses decided they didn't want to mess with the pain of the paperwork.

Indeed, just one more government evil. What LiveLean did is called structuring payments, so each transaction is under the limit. Making a >$10k transaction is not illegal but you may become a victim of civil asset forfeiture if you do this even when documented as the government mandates. It's just another tax, government stealing your money, but it's a hidden tax on a subset of the population. In most cases you'll spend more for lawyers trying to get your money back than you 'll get back, if you get anything back at all. It's all very arbitrary, as government violence typically it. In any event, structuring payments is a crime and I believe it's applicable to transfers over $10k in either a 30 day period or a calendar month... I forget which.

Nice xmas reading, peace on Earth, and goodwill to all in the new American police state:
(and sorry for getting off the thread topic)

https://www.aclu.org/blog/easy-money-civil-asset-forfeiture-abuse-police

https://www.techdirt.com/articles/20141214/11540529440/irs-drops-its-asset-forfeiture-case-against-owner-small-cash-only-restaurant.shtml
FIRE'd on January 4, 2017

lhamo

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Re: Ridiculous Things Dealerships Say and Do
« Reply #41 on: December 25, 2016, 10:52:00 PM »
This article provides a pretty good overview of how dealerships actually make money -- including how they make money on financing:

http://www.realcartips.com/newcars/135-how-car-dealers-really-make-money.shtml

When we bought our car last year, we went with the dealer financing because it got us an extra $2k off the MRSP.    I paid off the loan in full with my first payment, and paid something like $80 in interest.    The sales guy had told me it wouldn't affect his commission or anything -- I think in the case of Ford credit, they get some kind of commission for generating a loan.
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SeaEhm

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Re: Ridiculous Things Dealerships Say and Do
« Reply #42 on: December 25, 2016, 11:41:28 PM »
I just received a phone call stating that a dealership would like to purchase my wife's car back and get her into a brand new model for the same payment or less!


Just here to feel guilty about my purchases which are often irrational, wants, and in an atypical budget.

clarkfan1979

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Re: Ridiculous Things Dealerships Say and Do
« Reply #43 on: December 26, 2016, 10:27:58 AM »
One of my life goals is to never buy a car from a dealership every again. I have done this once in my life and it was one time too many.

Travis

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Re: Ridiculous Things Dealerships Say and Do
« Reply #44 on: December 26, 2016, 10:33:51 AM »
I briefly dated a guy who used to be a car salesman.  I forget the conversation, but I was talking about the total cost of a car purchase.  He said no one cared about the cost, only the monthly payments.  In the 2 years he sold cars no one ever negotiated for the final price.


There was an Edmunds writer a few years ago who worked at several dealerships undercover and reported back that all the salesmen were trained specifically to only talk about the monthly payments and redirect the buyer from any other figures.

Spork

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Re: Ridiculous Things Dealerships Say and Do
« Reply #45 on: December 26, 2016, 11:08:02 AM »
I briefly dated a guy who used to be a car salesman.  I forget the conversation, but I was talking about the total cost of a car purchase.  He said no one cared about the cost, only the monthly payments.  In the 2 years he sold cars no one ever negotiated for the final price.


There was an Edmunds writer a few years ago who worked at several dealerships undercover and reported back that all the salesmen were trained specifically to only talk about the monthly payments and redirect the buyer from any other figures.

This is absolutely the case.  This is the whole "4 square worksheet" goal.  Confound the buyer on the monthly price while moving numbers around to bump up the bottom line.
Some will sell their dreams for small desires
Or lose the race to rats
Get caught in ticking traps
And start to dream of somewhere
To relax their restless flight

Tjat

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Re: Ridiculous Things Dealerships Say and Do
« Reply #46 on: December 26, 2016, 11:41:57 AM »
I recently purchased a car and I was surprised not to get the financing sell. The salesman actually assumed it was a cash purchase when filling out the agreement.

Though in the Financing office I got the "here's the price, and for people who keep cars a long time, most people get the extended warranty...so let me add that right here..and..."

I quickly saved him the trouble

JAYSLOL

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Re: Ridiculous Things Dealerships Say and Do
« Reply #47 on: December 26, 2016, 11:53:19 AM »
I briefly dated a guy who used to be a car salesman.  I forget the conversation, but I was talking about the total cost of a car purchase.  He said no one cared about the cost, only the monthly payments.  In the 2 years he sold cars no one ever negotiated for the final price.


There was an Edmunds writer a few years ago who worked at several dealerships undercover and reported back that all the salesmen were trained specifically to only talk about the monthly payments and redirect the buyer from any other figures.

I remember ready that, it was a great piece he wrote.  It was amazing to hear about the high volume import dealer salesmen that bragged about bringing in crazy amounts like $25k/m selling cars for way over value to clueless customers

Shalamar

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Re: Ridiculous Things Dealerships Say and Do
« Reply #48 on: December 26, 2016, 12:51:40 PM »
I heard a dealership radio ad that said "Buy a (blah) car from us and get up to $1500 cash back to pay for Christmas!"   Me:   "They - they know that doesn't make any sense, right?"

Travis

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Re: Ridiculous Things Dealerships Say and Do
« Reply #49 on: December 26, 2016, 03:34:52 PM »
I heard a dealership radio ad that said "Buy a (blah) car from us and get up to $1500 cash back to pay for Christmas!"   Me:   "They - they know that doesn't make any sense, right?"

But, but, our entire consumer dynamic is built on spending money in order to "save."