Author Topic: Got a Lecture from Car Dealer Finance Guy  (Read 24866 times)

LiveLean

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Got a Lecture from Car Dealer Finance Guy
« on: November 26, 2019, 04:33:34 PM »
Bought a new Toyota RAV4 today. Paid cash. Ecstatic that I got $4,700 in trade for a dying minivan with 120K miles.

Stroked a check for $18,800. We tend to keep cars 8-9 years or until they drop. Given our net worth - close to FIRE - this is a modest purchase. Unfortunately, even when you pay cash you have to sign all of the paperwork with the finance guy, who shook his head when I handed over the check. "Man, you really should lease," he said.

"Why's that?" I asked.

(DW sensing tone in my voice: "Let it go, honey.")

Finance Guy: "You're losing out on all of that interest."

Me: "We keep cars 8-9 years. You lease you pay a ridiculous premium for three years. It's the most expensive way to have a car."

Finance Guy: "Yeah, but I get a new car every three years."

Me: "How much would you say you've spent on cars in the last decade?"

Finance Guy (doing some calculations): $58,000 in the last eight years. (Works for Toyota, drives a Lexus).

Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."

Finance Guy: "Man, you got to live a little. Can't take it with you." (Quite a salesman for Toyota, don't you think?)

Me: "You might want to listen to some Dave Ramsey."

Finance Guy: (pointing to cell phone) "Oh, I listen to him all the time. He's a big fan of leasing cars."

Me: "I think you got the wrong guy."

« Last Edit: November 26, 2019, 04:37:51 PM by LiveLean »

Glenstache

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #1 on: November 26, 2019, 04:54:19 PM »
He did his math on how much he spent over the last 8 years wrong, that's for sure...

MilesTeg

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #2 on: November 26, 2019, 05:12:50 PM »
Bought a new Toyota RAV4 today. Paid cash. Ecstatic that I got $4,700 in trade for a dying minivan with 120K miles.

Stroked a check for $18,800. We tend to keep cars 8-9 years or until they drop. Given our net worth - close to FIRE - this is a modest purchase. Unfortunately, even when you pay cash you have to sign all of the paperwork with the finance guy, who shook his head when I handed over the check. "Man, you really should lease," he said.

"Why's that?" I asked.

(DW sensing tone in my voice: "Let it go, honey.")

Finance Guy: "You're losing out on all of that interest."

Me: "We keep cars 8-9 years. You lease you pay a ridiculous premium for three years. It's the most expensive way to have a car."

Finance Guy: "Yeah, but I get a new car every three years."

Me: "How much would you say you've spent on cars in the last decade?"

Finance Guy (doing some calculations): $58,000 in the last eight years. (Works for Toyota, drives a Lexus).

Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."

Finance Guy: "Man, you got to live a little. Can't take it with you." (Quite a salesman for Toyota, don't you think?)

Me: "You might want to listen to some Dave Ramsey."

Finance Guy: (pointing to cell phone) "Oh, I listen to him all the time. He's a big fan of leasing cars."

Me: "I think you got the wrong guy."

Leasing is generally a bad idea, but dropping cash on a purchase in today's market conditions is not necessarily the best financial move either.

Should always run the math.

The_Big_H

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #3 on: November 26, 2019, 09:20:05 PM »
Bought a new Toyota RAV4 today. Paid cash. Ecstatic that I got $4,700 in trade for a dying minivan with 120K miles.

Stroked a check for $18,800. We tend to keep cars 8-9 years or until they drop. Given our net worth - close to FIRE - this is a modest purchase. Unfortunately, even when you pay cash you have to sign all of the paperwork with the finance guy, who shook his head when I handed over the check. "Man, you really should lease," he said.

"Why's that?" I asked.

(DW sensing tone in my voice: "Let it go, honey.")

Finance Guy: "You're losing out on all of that interest."

Me: "We keep cars 8-9 years. You lease you pay a ridiculous premium for three years. It's the most expensive way to have a car."

Finance Guy: "Yeah, but I get a new car every three years."

Me: "How much would you say you've spent on cars in the last decade?"

Finance Guy (doing some calculations): $58,000 in the last eight years. (Works for Toyota, drives a Lexus).

Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."

Finance Guy: "Man, you got to live a little. Can't take it with you." (Quite a salesman for Toyota, don't you think?)

Me: "You might want to listen to some Dave Ramsey."

Finance Guy: (pointing to cell phone) "Oh, I listen to him all the time. He's a big fan of leasing cars."

Me: "I think you got the wrong guy."

Leasing is generally a bad idea, but dropping cash on a purchase in today's market conditions is not necessarily the best financial move either.

Should always run the math.

If hes close to FIRE id say hes making good financial moves

Travis

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #4 on: November 26, 2019, 09:43:45 PM »

Finance Guy: "You're losing out on all of that interest."

...

Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."

Finance Guy: "Man, you got to live a little. Can't take it with you."



Way to deflect there, Mr. Salesman. 

Gremlin

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #5 on: November 26, 2019, 10:12:54 PM »
His job is to part you from your money.   He gets more if you lease.

As Upton Sinclair said - It is difficult to get a man to understand something when his salary depends upon his not understanding it.

iris lily

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #6 on: November 27, 2019, 08:14:12 AM »
We recently bought a used car for cash. Somewhere in our long rambling conversation with a car salesman, and before we talked about how we were going to pay, he made some crack about people paying cash for cars. Soon after we said hey we’re writing a check today, Ok?

He laughed at himself for his previous crack. But they did send the  “manager “ In to talk to us about the joys of financing. Maybe we wanna keep that money for a nice vacation? Finance the car instead? Ah no,I can afford to pay cash for the car AND ALSO take a nice vacation thank you very much.


Just Joe

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #7 on: November 27, 2019, 09:50:42 AM »
That seems high to me as well. Well, it COULD be lower if a person was motivated to. Keep your cars longer.

JAYSLOL

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #8 on: November 27, 2019, 09:55:59 AM »
Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."
Is there a typo in that number? $110,000 seems really high for two cars given I've only spent about $30,000-ish on two cars in a little under twenty years.

I think they mean two cars at a time over that period, meaning they spent about the same per car over 28 years that the salesman did in 10. 

MilesTeg

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #9 on: November 27, 2019, 09:57:25 AM »
We recently bought a used car for cash. Somewhere in our long rambling conversation with a car salesman, and before we talked about how we were going to pay, he made some crack about people paying cash for cars. Soon after we said hey we’re writing a check today, Ok?

He laughed at himself for his previous crack. But they did send the  “manager “ In to talk to us about the joys of financing. Maybe we wanna keep that money for a nice vacation? Finance the car instead? Ah no,I can afford to pay cash for the car AND ALSO take a nice vacation thank you very much.

The finance guy certainly wants you to finance so they get more money out of you and are in no way looking out for you, but that doesn't mean buying a car with cash can't be a lose-lose scenario. They lose financing income, you lose due to the opportunity cost of not using that cash in more productive ways than avoiding a loan.

Ann

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #10 on: November 27, 2019, 10:01:55 AM »
Perhaps the OP is including maintenance and repairs as well — which is fair, because you can’t accurately compare leasing vs purchasing without adding in maintenance and repairs.  I am *not* advocating for leasing but those that lease will quickly point out that they don’t have to worry about these “unexpected*” expenses.


*I put “unexpected” in quotes because they really should be expected.  They are more “irregular” or (hopefully) “infrequent” expenses.  I absolutely expect these costs to pop up in the future and save a slush fund for the various irregular insurance premiums, registration fees, and maintenance.
« Last Edit: November 27, 2019, 10:25:30 AM by Ann »

DadJokes

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #11 on: November 27, 2019, 10:09:25 AM »
(DW sensing tone in my voice: "Let it go, honey.")

Your wife has me rolling. I think I've heard that phrase from mine a few times...

MilesTeg

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #12 on: November 27, 2019, 10:11:23 AM »
Perhaps the OP is including maintenance and repairs as well — which is fair, because you can’t accurately compare leasing vs purchasing without adding in maintenance and repairs.  I am *not* advocating for leasing but those that lease will quickly point out that they don’t have to worry about these “unexpected*” expenses.


*I put “unexpected” in quotes because they really should be expected.  They are more “irregular” or (hopefully) “infrequent” expenses.  I absolutely expect these costs to pop up in the future and save a slush fund for the various irregular insurance premiums, registration fees, and maintenance that will pop up.

The maintenance and repair costs on leased vehicle are no less than a purchased vehicle. Leased vehicles don't pay scheduled maintenance (oil/etc.) and any repair work will be covered under warranty on the purchased vehicle.

Edit: I should clarify that I mean compared to purchasing/owning a new vehicle for the same term as a leased vehicle (typically 3 years)
« Last Edit: November 27, 2019, 10:26:50 AM by MilesTeg »

Ann

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #13 on: November 27, 2019, 10:35:19 AM »
Perhaps the OP is including maintenance and repairs as well — which is fair, because you can’t accurately compare leasing vs purchasing without adding in maintenance and repairs.  I am *not* advocating for leasing but those that lease will quickly point out that they don’t have to worry about these “unexpected*” expenses.


*I put “unexpected” in quotes because they really should be expected.  They are more “irregular” or (hopefully) “infrequent” expenses.  I absolutely expect these costs to pop up in the future and save a slush fund for the various irregular insurance premiums, registration fees, and maintenance that will pop up.

The maintenance and repair costs on leased vehicle are no less than a purchased vehicle. Leased vehicles don't pay scheduled maintenance (oil/etc.) and any repair work will be covered under warranty on the purchased vehicle.

Edit: I should clarify that I mean compared to purchasing/owning a new vehicle for the same term as a leased vehicle (typically 3 years)

Ah, thank you for the edit.  I was about to add that my post was assuming one would  keep a vehicle long after the warranty runs out (and not purchasing an extended warranty).

Goldielocks

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #14 on: November 27, 2019, 12:47:49 PM »
I bought a new to me used car last week.

Because I agreed to finance, I got a reduction in price and they agreed to detail the car I am selling. (We walked away from a deal over $1000 difference four days before we came back to renegotiate, so I know we got the best price possible right now).

The finance deal is strange.
$0 Down
7.8% financing rate, over 60 months.  No penalty if we pre-pay.
First payment due in 30 days.  Can pay off the remainder the day after.
If we keep the loan in place for 8 months, they give us $300 to cover the interest. 

BUT, the interest on 8 payments is only about $170 if we pay down almost all of it after 1 month.

So we make another $130 net and I pay interest on a modest sum for 8 months at a high rate.

AND they get a bonus for financing it of about $1000 from the finance company.

joleran

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #15 on: November 27, 2019, 03:07:59 PM »
I bought a new to me used car last week.

Because I agreed to finance, I got a reduction in price and they agreed to detail the car I am selling. (We walked away from a deal over $1000 difference four days before we came back to renegotiate, so I know we got the best price possible right now).

The finance deal is strange.
$0 Down
7.8% financing rate, over 60 months.  No penalty if we pre-pay.
First payment due in 30 days.  Can pay off the remainder the day after.
If we keep the loan in place for 8 months, they give us $300 to cover the interest. 

BUT, the interest on 8 payments is only about $170 if we pay down almost all of it after 1 month.

So we make another $130 net and I pay interest on a modest sum for 8 months at a high rate.

AND they get a bonus for financing it of about $1000 from the finance company.

edit: nevermind, I see what you're saying, but you'd need to only pay it off so your first 8 payments would just barely cover the 8 payments or you'd end up paying it off earlier.

MoneyQuirk

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #16 on: December 02, 2019, 02:31:34 PM »
"You gotta live a little" - Snooty Car Financial Guy

I'm living just fine without having my money stolen, thank you very much.

I'd argue I might just be living a little more than you, because I have time to do things.

firstmatedavy

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #17 on: December 04, 2019, 11:59:42 AM »
Reminds me of the time my husband was considering trading in his car for a newer used car, because his cousin the mechanic said it would need an expensive repair soon. We were looking at a Subaru of some kind (it was a while ago), and they sat us down with someone to talk about financing even though we were very much not sold on it - the car was more expensive than we'd expected and they didn't offer us much for trade in.

At some point I said we didn't want to take on debt for something that would just depreciate like the last car did (low trade in value), and the guy decided it was time for a hard sell and went on this rant about how we want a good car, we want a car that holds value, we need a SUBARU! Yeah... Sorry buddy, all cars depreciate.

Luckily, it turned out my cousin in law's idea of an expensive repair wasn't all that bad. We got the old car fixed and it still runs fine.

mtn

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #18 on: December 04, 2019, 01:06:12 PM »
They're just trying to make a sale. They're not personal finance professionals.

We recently bought a brand new Kia. Most money I've ever spent on anything that wasn't a hospital bill or a house, first new car I've ever had, and a huge change for us as our prior 5 cars were an average of 14 years old at the time of purchase and an average of $1800. So the $30k minivan was a big deal. We had been pre-approved by our credit union, and I told them the rate. They said they could match it, so I said, sure. Our rate at the CU was 2.74%. Salesman comes back and says "well, we did it! 3.84%". I said, "Ok, well, that is off by quite a bit - give me a second to do the math".... About 2 minutes later, I said "ok, this is going to be a difference of about $940 over the course of the loan - we're reducing the sale price by that much, right?"

Next day I paid that loan off in full with the credit union loan. Worked out pretty well for me.

MrDelane

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #19 on: December 04, 2019, 04:10:28 PM »
They're just trying to make a sale. They're not personal finance professionals.

We recently bought a brand new Kia. Most money I've ever spent on anything that wasn't a hospital bill or a house, first new car I've ever had, and a huge change for us as our prior 5 cars were an average of 14 years old at the time of purchase and an average of $1800. So the $30k minivan was a big deal. We had been pre-approved by our credit union, and I told them the rate. They said they could match it, so I said, sure. Our rate at the CU was 2.74%. Salesman comes back and says "well, we did it! 3.84%". I said, "Ok, well, that is off by quite a bit - give me a second to do the math".... About 2 minutes later, I said "ok, this is going to be a difference of about $940 over the course of the loan - we're reducing the sale price by that much, right?"

Next day I paid that loan off in full with the credit union loan. Worked out pretty well for me.

Hahahah.  Brilliant.
This is fantastic, well done.

martyconlonontherun

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #20 on: December 04, 2019, 04:24:24 PM »
My random car story. Had my mind set on a 1-year old malibu. They are a pretty much a commodity. Made it clear I only cared about the bottom line. Monthly payment made no difference to me and preferred the 36mths 1.9% special offer ($430/mth). I stated what price i would be good at he said that probably wouldn't work. We went back and forth 4x and the guy got within $75 of my original number, each time coming down but shuffling ("we took off the charged for certification"). If they would've just started at that I would've been fine.

Then i asked if they charged for using a credit card for a down payment. After they said no, I asked what's the most I could put on it (so I could hit minimum spend on the card). I'm pretty sure he had no clue on how I did my math and just assumed I couldn't afford the car or something and that is why I tried putting 3k on the card.

dogboyslim

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #21 on: December 05, 2019, 07:56:50 AM »
I bought a new to me used car last week.

Because I agreed to finance, I got a reduction in price and they agreed to detail the car I am selling. (We walked away from a deal over $1000 difference four days before we came back to renegotiate, so I know we got the best price possible right now).

The finance deal is strange.
$0 Down
7.8% financing rate, over 60 months.  No penalty if we pre-pay.
First payment due in 30 days.  Can pay off the remainder the day after.
If we keep the loan in place for 8 months, they give us $300 to cover the interest. 

BUT, the interest on 8 payments is only about $170 if we pay down almost all of it after 1 month.

So we make another $130 net and I pay interest on a modest sum for 8 months at a high rate.

AND they get a bonus for financing it of about $1000 from the finance company.

I did this.  Had to keep the loan for 3 payments.  As soon as the loan originated, I paid a principal payment down to the level that the 3rd payment was a payoff.  Total interest was MUCH less than the amount I got off for the purchase.  Got a call 4 months later from the finance guy from the dealership asking what I did.  Apparently they didn't get the kickback they expected and were pissed.  I said I paid 3 payments, at which time the loan was paid off, just like you said I had to, agreed to show him the loan transactions to prove it.  He then said, so then why was the finance charge so low?  I explained exactly what I did, how it was allowed in the terms, and then he said "<F--->, I should have just let you pay cash."

DadJokes

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #22 on: December 05, 2019, 08:11:27 AM »
I bought a new to me used car last week.

Because I agreed to finance, I got a reduction in price and they agreed to detail the car I am selling. (We walked away from a deal over $1000 difference four days before we came back to renegotiate, so I know we got the best price possible right now).

The finance deal is strange.
$0 Down
7.8% financing rate, over 60 months.  No penalty if we pre-pay.
First payment due in 30 days.  Can pay off the remainder the day after.
If we keep the loan in place for 8 months, they give us $300 to cover the interest. 

BUT, the interest on 8 payments is only about $170 if we pay down almost all of it after 1 month.

So we make another $130 net and I pay interest on a modest sum for 8 months at a high rate.

AND they get a bonus for financing it of about $1000 from the finance company.

I did this.  Had to keep the loan for 3 payments.  As soon as the loan originated, I paid a principal payment down to the level that the 3rd payment was a payoff.  Total interest was MUCH less than the amount I got off for the purchase.  Got a call 4 months later from the finance guy from the dealership asking what I did.  Apparently they didn't get the kickback they expected and were pissed.  I said I paid 3 payments, at which time the loan was paid off, just like you said I had to, agreed to show him the loan transactions to prove it.  He then said, so then why was the finance charge so low?  I explained exactly what I did, how it was allowed in the terms, and then he said "<F--->, I should have just let you pay cash."

It warms my heart to hear a dealership finance guy upset that someone outsmarted the system.

Just Joe

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #23 on: December 05, 2019, 04:57:54 PM »
 I just don't have the patience for the finance guys anymore. After going 'round and 'round with a couple years ago I default to credit union financing regardless.

Dave1442397

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #24 on: December 05, 2019, 05:05:29 PM »
I just don't have the patience for the finance guys anymore. After going 'round and 'round with a couple years ago I default to credit union financing regardless.

Same here. I have a 3.49% loan on a used car right now. When I told the finance guy my rate, he said the lowest he could do was 3.99%. I said "Well, that's higher than what I got from PenFed, so I guess I'll be going with their financing", and that was that. He passed me off to a hottie who tried to seduce me into buying extended warranties, which I also resisted. I'll have the car two years this month, and of course nothing has gone wrong with it.

Glenstache

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #25 on: December 05, 2019, 05:25:29 PM »
Bought a new car a few months ago. I went new because the used versions of the vehicle I wanted were so close to new cost that it did not make sense to buy used (which was surprising). I researched actual sales numbers and shot to get the upper end of the curve. It was pretty simple. I went to the dealership, saw the car, made it clear that I had done my research and was willing to walk away. I told them the inclusive price I would need out the door to sign that evening. I went in mentally prepared to walk away over any price over my threshold and that it would take a few hours to go the process. I was respectful to the sales person (who was not a sleaze, actually a decent person as far as i could tell). The process of back and forth took about 3 hours from walking into dealership to driving away, paid in cash.

I had earlier had a few interactions with other dealerships which ran the gamut of sleaze (hiding major mechanical issues, etc) to easy. I walked away from one deal because they remained just a couple hundred dollars above my threshold. Such is life.

I truly feel bad for people with poor financial literacy trying to go through the process. It is a large sum of money for many people, and the losses of $$ to finance schemes, "just live a little" arguments, etc is a big setback to a lot of people over the long term. A lot of the sales are heavily influenced by emotion either by desire, confusion, being worn down, such that it takes even more than just knowing how to do the numbers to really make the right decision. This goes for buying houses, etc too. Those lessons are tough to learn on your own.

Miss Piggy

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #26 on: December 05, 2019, 09:02:46 PM »
Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."
Is there a typo in that number? $110,000 seems really high for two cars given I've only spent about $30,000-ish on two cars in a little under twenty years.

This doesn't make sense to me, either. What am I missing?

slugline

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #27 on: December 06, 2019, 08:57:33 AM »
Me: "See,wife and I here have spent $110,000 on TWO cars over the last 28 years, $129K if we count this Rav4. We've made a lot of "interest" on that money I didn't spend on cars."
Is there a typo in that number? $110,000 seems really high for two cars given I've only spent about $30,000-ish on two cars in a little under twenty years.

This doesn't make sense to me, either. What am I missing?

Could we be going all-in on the cost of driving -- the cars themselves, gas, maintenance, parking,  tolls, insurance? The average American might go into cardiac arrest if they saw that total over the course of decades.

ketchup

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #28 on: December 06, 2019, 09:32:58 AM »
Man, I'm glad I've never bought a car from a dealer.  Awful.

joleran

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #29 on: December 06, 2019, 11:06:57 AM »
Man, I'm glad I've never bought a car from a dealer.  Awful.

I can't believe how badly I mishandled the first dealing I had with one.  Spent literally 8 hours with them and still probably overpaid by a good $2k on a $14k car.  Fool me once...

FINate

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #30 on: December 06, 2019, 11:34:11 AM »
Short of physical torture, it's difficult to imagine a customer experience more painful than the dealership. I'm actually quite thankful for it -- whenever I'm tempted to replace one of my old paid-off vehicles I contemplate the ordeal involved and sanity is quickly restored.

talltexan

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #31 on: December 12, 2019, 07:45:56 AM »
Short of physical torture, it's difficult to imagine a customer experience more painful than the dealership. I'm actually quite thankful for it -- whenever I'm tempted to replace one of my old paid-off vehicles I contemplate the ordeal involved and sanity is quickly restored.

That is one of the nice things about keeping cars for a long time. Not having to car shop.

I've got a Camry with 133K miles on it. Hopefully I'll be good for a while.

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #32 on: December 12, 2019, 09:42:14 AM »
I bought a car from Carvana last month.  My previous car was having problems with the CVT, and I just really didn't like the car.  So I searched for what I wanted and Carvana had one.  I compared the price to others and it was a good price.  Put in my VIN on the Carvana site, they came back with a few questions and asked for specific pictures, the next day got an offer.  I checked it against various sites and it was a fair trade offer.  All up sales, warranties and such, were check boxes.  I chose cash option.  They called and we had a three way conversation with the bank to verify that my account had at least $X.

Scheduled an appointment at the Carvana building for a few days later.  Showed up, took about an hour to test drive and paperwork, and done.  Best car buying experience ever!

Just Joe

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #33 on: December 12, 2019, 12:49:15 PM »
Your Carvana experience is similar to our CarMax experience - and good prices.

I hope their business model at least pushes the traditional dealerships to quit the games. I won't ever go back to a traditional dealer at this point. We keep our cars a long, long time.

partgypsy

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #34 on: December 12, 2019, 12:58:19 PM »
I also had a positive carvana experience. They offered I think 2.7% financing over 4 years (I was separating from spouse, had very little cash) and the price was fair from everything I researched, and the car was still under warranty for the first year as well.

Just Joe

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #35 on: December 13, 2019, 11:44:29 AM »
We did our financing with our credit union, didn't even give CarMax a chance and they didn't blink an eye.

With a traditional dealer experience, everything can change once self-financing or cash is revealed.

"Well then, we'll need to re-negotiate everything then" (b/c of creative math on their part to maximize profit and minimize customer awareness of the real price tag). 

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #36 on: December 13, 2019, 12:11:18 PM »
Short of physical torture, it's difficult to imagine a customer experience more painful than the dealership. I'm actually quite thankful for it -- whenever I'm tempted to replace one of my old paid-off vehicles I contemplate the ordeal involved and sanity is quickly restored.

Weird isn't it?  In most industries, they strive for a good customer experience.  Buying a car is like paying to get waterboarded.

Pizzabrewer

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #37 on: December 13, 2019, 01:29:14 PM »
Hmm. Y’all got me thinking here. My Subaru just died and I have my eye on a used car at a dealership in the $8k price range. I was planning to pay cash.

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.
« Last Edit: December 13, 2019, 01:32:01 PM by Pizzabrewer »

Telecaster

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #38 on: December 13, 2019, 02:29:34 PM »
Hmm. Y’all got me thinking here. My Subaru just died and I have my eye on a used car at a dealership in the $8k price range. I was planning to pay cash.

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.

Maybe.  IMO, you already want to negotiate the sales price first.  Then if they want to negotiate on financing, great.  You are in a good position because you don't have to accept their financing.  Keep in mind car dealers are very skilled in not telling you the price.  You must keep steering the conversation back to price.   It is a very draining experience. 

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #39 on: December 13, 2019, 02:45:05 PM »
Hmm. Y’all got me thinking here. My Subaru just died and I have my eye on a used car at a dealership in the $8k price range. I was planning to pay cash.

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.

Maybe.  IMO, you already want to negotiate the sales price first.  Then if they want to negotiate on financing, great.  You are in a good position because you don't have to accept their financing.  Keep in mind car dealers are very skilled in not telling you the price.  You must keep steering the conversation back to price.   It is a very draining experience.
A few years ago I was buying a 3 year old car at a dealership and had no problems negotiating on price (vs payments). When the salesman finally came down to my number it was on the condition that I financed through them, but the interest rate would be a max of 3.5%. I think there was some stipulation that I needed to make a certain number of payments but I didn't have the cash at the to just pay it off anyway

An accidental trick I learned from that one was to buy the warranty if they'll discount your rate, then cancel it immediately.
They offered me a rate discount to buy the warranty saying the rate discount would make it not cost me anything. I ended up with a 1.6% interest rate but when I ran the numbers the next day I was actually coming out way behind, so I called to complain and was told that I had 60 days to cancel the warranty for a full refund and they couldn't change my rate so I kept the discounted one.

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #40 on: December 13, 2019, 07:25:28 PM »

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.

I'm on the same page as Pizzabrewer.

The general strategy is to not even introduce cash as a possibility, but just let them think I'm gonna finance, then once we agree on a price sit down with the finance dude and start handing over Benjamins? Like "what, no dude I'm not financing this." Can that be right?

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #41 on: December 14, 2019, 11:20:48 AM »
An alternate approach is to do it all by email. Get the “internet price quote” from a few dealers, do your research on actual sales statistics, and then haggle online by email until you get the deal you want.

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #42 on: December 14, 2019, 05:33:26 PM »
I just don't have the patience for the finance guys anymore. After going 'round and 'round with a couple years ago I default to credit union financing regardless.

Same here. I have a 3.49% loan on a used car right now. When I told the finance guy my rate, he said the lowest he could do was 3.99%. I said "Well, that's higher than what I got from PenFed, so I guess I'll be going with their financing", and that was that. He passed me off to a hottie who tried to seduce me into buying extended warranties, which I also resisted. I'll have the car two years this month, and of course nothing has gone wrong with it.

Haha, classic car dealership move.  I got exactly the same thing when I bought a car at the dealer, it was a used Hyundai, just out of the warranty period, they tried to get me to do their financing (5.99%), but I paid cash instead.  Then they did the exact same thing passing me off to the cute gal that did extended warranty up sells, must have thought I wasn’t too bright because they originally offered me 3 years but it was something crazy like $4k.  Screw that, I’m not going to blow 2 engines in the course of 3 years.  Then she offered more and more discounts until she had basically cut the price in half, I still wouldn’t budge so she got the sales guy that sold me the car to help pour on the pressure which still didn’t work. 

Pizzabrewer

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #43 on: December 14, 2019, 06:45:54 PM »
I've bought a car from a dealership 3 times in my life.  The first was a new Acura Integra in about 1987.  I tried to resist all the sales bullshit, walked out a couple times during negotiations (my wife said she'd never accompany me to a dealership again, and she hasn't), but I still fell victim to their price and financing games.  It was a great little car though.

The second time was a new Subaru in about 1995.  This time I went in armed with a printout of the all the dealer's costs on the car as equipped.  There was a service in those pre-internet days where you could order this info.  The salesperson immediately dropped the act and gave me a decent price.  Minimal bullshit as I told them upfront that any efforts to sell me extras (warranties, fabric protection, extra rustproofing, etc) and I'd walk away.

The third time was a used Subaru about 8 years ago (this is the car that just died).  Same kind of thing, I did my research, told them I'm paying cash and here's what I'm willing to pay.  The negotiations were mercifully short.  The only wrinkle was the $500 I put on the cc to hold the car for a couple days, they REALLY wanted me to use to buy a warranty.  It took about a half dozen firm "NOs" before they gave up and applied it to the purchase price.

So I have a similar attitude this time.  For a $7000 to $8000 car it's not worth it to spend several hours fighting their bullshit.  I had planned to go in with a "cash only, here's what I'll pay" approach.  But if I can game the financing deal to save a few $100 by paying off a loan at 3 months, heck yeah. 



« Last Edit: December 14, 2019, 07:08:30 PM by Pizzabrewer »

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #44 on: December 14, 2019, 09:27:38 PM »
An alternate approach is to do it all by email. Get the “internet price quote” from a few dealers, do your research on actual sales statistics, and then haggle online by email until you get the deal you want.

This is 100% how to do it. I test drove the car I wanted and when they tried selling it to me, I gave them a ridiculously low offer to shut down any back and forth. Then I emailed all of the dealers within an hour. After some emails back and forth, I was a few thousand under msrp for my Honda. Drove to the dealership and was in/out in less than an hour. Pretty much the time it took for paperwork and that was it. I’ll never purchase a car from a dealership a different way.

Just Joe

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #45 on: December 16, 2019, 07:50:30 AM »
The whole traditional car dealership experience just sucks. I guess it would be far more enjoyable if we just went in and paid the $5K upcharge and bought the warranty/etched glass/undercoating/ceramic paint coatings.

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #46 on: December 16, 2019, 09:57:25 AM »
The whole traditional car dealership experience just sucks. I guess it would be far more enjoyable if we just went in and paid the $5K upcharge and bought the warranty/etched glass/undercoating/ceramic paint coatings.

I'm sure they still get some of those people. I remember having a car conversation with a friend, and his girlfriend piped up and said "You mean you don't have to pay the price they put on the window sticker?". At least she had purchased a Civic, so she didn't take too much of a hit.

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #47 on: December 16, 2019, 10:32:32 AM »
Hmm. Y’all got me thinking here. My Subaru just died and I have my eye on a used car at a dealership in the $8k price range. I was planning to pay cash.

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.

Yes.

1. Negotiate final price with sales person if in store (don't fall for 4 square BS). Don't talk financing, if salesperson assumes financing, go with the flow and say yeah yeah whatevs. At the same time, gather 3rd party financing with your credit union/bank.
1b. Better to use the internet sales team and communicate via email. You get a written quote.
2. Negotiate financing with finance person using dealer's financing. Use the 3rd party financing to match. Or throw in the C@$H 1$ K1NG joker card when it's time to pay. This is where you leverage/arbitrage. Sometimes easier to take the finance option, let dealer get their commision (ask them to slit some of that sweet kickback with you). Ensure there's no early prepayment penalty. Then pay off the loan on the next business day.

Pizzabrewer

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #48 on: December 16, 2019, 11:18:08 AM »
Hmm. Y’all got me thinking here. My Subaru just died and I have my eye on a used car at a dealership in the $8k price range. I was planning to pay cash.

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.

Yes.

1. Negotiate final price with sales person if in store (don't fall for 4 square BS). Don't talk financing, if salesperson assumes financing, go with the flow and say yeah yeah whatevs. At the same time, gather 3rd party financing with your credit union/bank.  As I have no interest in financing, I suppose I could just lie and say my credit union approved me at, what 3.99%?
1b. Better to use the internet sales team and communicate via email. You get a written quote.I submitted the request, haven't heard back yet.  Interesting thing, according to the free Carfax they have on their website, they've been trying to sell this car since July.
2. Negotiate financing with finance person using dealer's financing. Use the 3rd party financing to match. Or throw in the C@$H 1$ K1NG joker card when it's time to pay. This is where you leverage/arbitrage. Sometimes easier to take the finance option, let dealer get their commision (ask them to slit some of that sweet kickback with you). Ensure there's no early prepayment penalty. Then pay off the loan on the next business day.Sounds good, thanks.  Worst case I just pay the cash.  I'll try to game the system if it looks promising.

jinga nation

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Re: Got a Lecture from Car Dealer Finance Guy
« Reply #49 on: December 16, 2019, 03:14:23 PM »
Hmm. Y’all got me thinking here. My Subaru just died and I have my eye on a used car at a dealership in the $8k price range. I was planning to pay cash.

Are you saying that after negotiating a price, the finance person will drop the price lower if you agree to their financing?  That seems to be what MrDelane, Goldilocks and dogboyslim are saying.

Yes.

1. Negotiate final price with sales person if in store (don't fall for 4 square BS). Don't talk financing, if salesperson assumes financing, go with the flow and say yeah yeah whatevs. At the same time, gather 3rd party financing with your credit union/bank.  As I have no interest in financing, I suppose I could just lie and say my credit union approved me at, what 3.99%?
1b. Better to use the internet sales team and communicate via email. You get a written quote.I submitted the request, haven't heard back yet.  Interesting thing, according to the free Carfax they have on their website, they've been trying to sell this car since July.
2. Negotiate financing with finance person using dealer's financing. Use the 3rd party financing to match. Or throw in the C@$H 1$ K1NG joker card when it's time to pay. This is where you leverage/arbitrage. Sometimes easier to take the finance option, let dealer get their commision (ask them to slit some of that sweet kickback with you). Ensure there's no early prepayment penalty. Then pay off the loan on the next business day.Sounds good, thanks.  Worst case I just pay the cash.  I'll try to game the system if it looks promising.

Forgot to mention. Use cargurus.com using your desktop/laptop, not your mobile. The listing shows how long the vehicle has been listed, price history, etc.

 

Wow, a phone plan for fifteen bucks!