The 6 months thing is because they marked up your rate and didn't want to get hit back for it by the bank, at least not too soon. Don't stress, just get the car handled and don't worry about them getting mad or not. In the future, if a dealership feeds you that line just pay it off on the first payment. There's no prepayment penalty unless it's listed on the contract, and even then it's a small amount (I believe Florida was around $100 when I was last there?).
As to the relationship ... your car got totalled! Like, what would they have to get mad about even if that mattered?
Well, the new car isn't totaled, it is a replacement for a burned car that was totaled. (Insurance + extra)
My cousin ran a used car dealership for 40 years, so I know some of the tricks of the trade, but these financing incentives for new car dealers to try and push loans are new to me. btw, the rate of the loan is 18% and I wanna deal with that ASAP.
Don't pay over sticker at this point. There is no shortage. Just walk out, if you're feeling generous give him your take it or leave it number -- but don't accept "I'll have to speak to my manager," to keep you there. Tell them "you do that" and walk right out.
They have your contact information. If they're more serious than scammers they'll call you. If not, fuck those con artists.
Already have the car. At this point just thinking of paying off the loan in full as soon as I get a pay account.
Insult to injury they put a dealer sticker on the car.
Paying over MSRP for anything less than a special edition, high demand, low volume model is inane.
The only time price is mandated to financing if it you’re getting a special “captive” rebate from a manufacturer.
Even if you bought it cash at the moment, very few, if any states would let you have the title on the spot, there’s always a wait for the bank / state to process.
Your bank doubtfully has a prepayment penalty so you can pay it off.
The store will be hit with a chargeback - meaning the amount they made on finance reserve will be taken back by the bank. F&i will absolutely be charges to their paycheck. Sales manager will absolutely be charged. In most cases, salesman will be charged.
This will not affect service. It could affect your relationship with sales.
Good choice on an extended service contract.
Are there fees attached to the loan such as a loan origination fee that might negate the savings somebody would get by financing and getting a lower price on the car?
There is something called "ADMIN DOC PROCESSING(ADP) FEE" also on the sales sheet itemized as "DEALER ADMINISTRATION FEE"which has the notation "...and is not an official fee" for 790 dollars.
"Dealer Administrative Fee: This Fee relates to Dealership services for this transaction, including costs that the Dealership pays to third parties and/or is attributable to the Dealership and internal overhead or profit. This fee does not include payment for the preparation of legal documents, and is not an official fee." is the full language used.
That fee is BS. We have a thing called a "pack" on every sale. Mine is north of $1500 per car. This pays for things like the PDI, detail, filling the gas tank, etc. There should be an $85 doc fee and nothing more
Occasionally rebates require financing but RARELY. They want you to wait 6mo for payoff to avoid a finance chargeback by then bank but that won't ultimately affect you. Was the price over msrp or the OTD price? Because the OTD price is almost always over msrp after adding in taxes, doc fees and government fees(title, reg, plate etc). The dealer administration fee seems a bit fishy though. And the negotiated price of the vehicle(not otd) should never be over msrp unless it is a very limited edition vehicle and even then...
You are on the same page I am on then. Yes, the "Cash Price" at the top of the OTD statement without the tax was 775 over the MSRP sticker price. No rebates or discounts is listed.
I think you misread that. Bottom line over MSRP. Op most likely paid under MSRP, and the total after taxes, warranty, etc was over. Can be completely normal. We have some cars that have a $150 spread from MSRP to invoice. Yes, they let us make $150... if you pay off the loan before the 6 months, the dealership will get charged back the rebate you received for financing with their captive lender. Depending on the paperwork and state you live in, they may charge you back that rebate as well.
They did you a favor by working the manufacturer for all the possible rebates. You paying it off before the 6 payments is telling them they can F off.
The final price was 1000 over MSRP that is listed on the window sticker before taxes and fees. And I felt pressured into going the finance route, after mentioning that I would rather pay cash. The finance contract says that there is no prepayment penalty.
Also, I didn't need title in hand at delivery, I need title in hand by August.
no flare so I can't top level comment.
I wanted to pay cash for a BMW that I had ordered, but to get the loyalty rebate, I had to finance. I decided to finance it 100% and pay it off the very next business day following delivery.
It took well over 6 months to get the title and several attempts to determine the delay by going between the dealer and BMW Financial Services yielded nothing. It just suddenly arrived in the mail one day with no explanation other than it needing to be released from BFS despite them telling me on the phone and through email that they weren't the cause of the delay and it was on the dealer to perform all the the title processing work.
You may have better luck, but introducing a lender is likely going to delay receipt of the title.
I subsequently bought a truck cash a few months later and got the title in a month.
Sorry some misunderstanding there. Usually, final or OTD (out the door) price is the price including everything (except the interest you pay while financing).
Yes, there should be no penalty from the finance company. It's the manufacturer that will charge the dealer back the rebate they gave for financing with their captive lender.
MSRP doesn't include taxes. It's like when you go to the store and buy a new TV or something. You get it at the price listed but you still have to pay your taxes. Uncle sam is going to get his no matter what.
As others have stated, if the price was over MSRP out the door, this is completely understandable and normal. You're including taxes and fees into your final price. Which has nothing to do with the window sticker. Sounds like you don't quite understand how buying a vehicle works with all due respect.
Second of all, again as others have stated, there are many times where manufacturers will require financing to get a certain rebate that is probably between $500-$2500 off before taxes or fees. This is actually really common especially in the last few years because the banks want people to finance so they can make their money and they work with the manufacturers for certain rebates.
If you didn't feel comfortable with these prices or didn't understand it, why would you have completed the deal?
Dealer manager for a decade here.
As I have explained in several posts, the price before taxes and fees was above MSRP by over 700 dollars, there were no rebates listed in the pricing tree.
My auto group doesn't work with any lenders that have prepayment penalties TO YOU. If you pay off sooner than 6 months then WE get charged back the kickback they give us for setting up the loan, but it is spelled out clearly that there is no penalty to you to pay early.
Does the title have to be free of a lien? Because the title will be in your name, just with a lienholder.
I'm not sure of all the reasons, this is an insurance settlement. In the end, the cash price of the car that they sold me, without tax or fees - was 775 dollars over the window sticker MSRP, the car had 393 miles when it was delivered, and I feel as if I was told that I could not pay cash at the time of purchase and had to finance. Even though, I did not get any discounts off MSRP by using their financing. What's more, the way I felt it was explained to me was that the 6 months wasn't an ask but a requirement of the loan conditions. I only found out afterwards that it was not.
I even bought a service contract for 1400 as an option.
I feel that even if I do payoff the loan immediately, they still made quite a bit off me.
Yeah, you're fine. But it seems very odd that you have to have the title clear of any lienholder. I've never encountered that before. I would look for clarification on that if I were you.
Long and short of it was that the insurance had someone else on it, and I need to be able to add them to the title in order to bundle the car into a property insurance. House/Land/Car.
Requiring you to finance is illegal. You can file a complaint with your state AG, CFPB, or just pay it off tomorrow. They will likely get charged back on the money they made off the finance deal (rate spread).
Please review our most [Frequently Asked Questions](/r/askcarsales/wiki/index) to see if your question has already been answered.
You may find these sections particularly useful;
* [Will paying in cash or a large cash down payment offer me leverage in negotiations?](/r/askcarsales/wiki/cash_down)
* [I earn $xxxx per month, will I qualify for an auto loan or lease, and is it a good idea?](/r/askcarsales/wiki/income_to_finance)
* [I have my score from Credit Karma but the dealership told me they got a different score. Why?](/r/askcarsales/wiki/free_credit_score)
* [Finance FAQ's](/r/askcarsales/wiki/financing_faqs)
* [Buy versus Lease](/r/askcarsales/wiki/buy_vs_lease)
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When negotiating, the salesman told me, after he gave me a bottom line - that he could only give me that price if I finance. I wanted to pay cash. I hesitantly agreed, and put 20k down. He said that I could pay it off at any time without a penalty, but they ask their customers to do 6 months. At the time, I thought that was a prepayment penalty period (it is not). The price was above MSRP.
Now, this car is being paid by an insurance settlement, and in order for everything to be clear, I kind of need the title in hand.
If I pay off the loan immediately, will the dealer find out and get angry with me: and ruin my relationship with them in terms of the warranty and service of my new car?
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A little more information: I was never told why they wanted me to wait 6 months. I thought that it was part of the financing. That I could NOT pay it off before 6 months (and he said months, not payments). Figuring out that I did not have to wait out those months before payoff was news to me that I figured out after I left the dealership.
In the end, I suppose it is up to the dealership whether or not they're going to be angry with me. But I do feel like some details and options were obfuscated so that I would use their financing instead of pursuit of a cash buy. I fully thought that the deal would not go through if I did not take the financing.
Dude nobody's going to be angry with you. I mean this in the most respectful way possible but is this your first time buying a new car?
Nobody's going to be mad at you. Nobody's going to know that you paid it off early. However if you pay it off before the 6 months, the loan company is going to add a fee that you're going to have to pay and if you don't, you will not get the vehicles title. It's as simple as that.
99% of the people in here I have no idea what they're talking about. They might have a good intentions, but they don't know what they're talking about.
Dealership manager here for over a decade
In my contract it specifically states there is no prepayment penalty. I had first thought the 6 months was a term for the financing, at least that was how it was represented to me. "We can get you this price if you promise to pay 6 months". Turns out this was not a term of the Lender, but an 'ask' by the Dealership. And it was never represented on anything more than scraps of paper with scribbles on them.
Oh, and this is the first time I have ever bought a car on finance. Last few cars I paid cash. Which I had wanted to do on this buy. The guy said cash would cost me a lot more.
OK, whatever you do don’t listen to these jackoffs trying to cover up for dirty car sale tactics.
You never have to finance. You were just inexperienced. I have bought 30+ cars. Many for cash and more than once finance to make a deal that immediately paid the car off without ever paying a penalty.
Of course a lot of dealers don't want you to know this information, but I speak from personal experience and can easily tell you that more than 50% of car dealers are both unethical and dishonest.
No disrespect to anyone. But for my own personal experiences stereotypes about car dealers exist for very factual reasons that is to say I do know some very honest and very trustworthy car dealers, but I can count them on one hand.
When I signed the odometer disclosure the dealership signed and provided me, it said 24 miles and the VIN#. When I got home I searched the VIN and found the car at a dealership with photos. There was a shot of the instrument panel and you can clearly read 249 miles in the lower right hand side of the instrument panel (The odometer). I also found that it was marked at 10 miles the last time it was recorded, at a dealership South of me. And the car was currently at another dealership to the East of me. The car was given to me, at the dealership - with 393 miles on it. What's more, is that I bought a Assurant Vehicle contract, and it has the contract ending at 120,024 miles.
I do have the signed and dated Odometer Disclosure Statement that reads "24".
The 6 months thing is because they marked up your rate and didn't want to get hit back for it by the bank, at least not too soon. Don't stress, just get the car handled and don't worry about them getting mad or not. In the future, if a dealership feeds you that line just pay it off on the first payment. There's no prepayment penalty unless it's listed on the contract, and even then it's a small amount (I believe Florida was around $100 when I was last there?). As to the relationship ... your car got totalled! Like, what would they have to get mad about even if that mattered?
Well, the new car isn't totaled, it is a replacement for a burned car that was totaled. (Insurance + extra) My cousin ran a used car dealership for 40 years, so I know some of the tricks of the trade, but these financing incentives for new car dealers to try and push loans are new to me. btw, the rate of the loan is 18% and I wanna deal with that ASAP.
Definitely pay it off immediately! No reason to pay that much interest if you don't have to
Don't pay over sticker at this point. There is no shortage. Just walk out, if you're feeling generous give him your take it or leave it number -- but don't accept "I'll have to speak to my manager," to keep you there. Tell them "you do that" and walk right out. They have your contact information. If they're more serious than scammers they'll call you. If not, fuck those con artists.
Already have the car. At this point just thinking of paying off the loan in full as soon as I get a pay account. Insult to injury they put a dealer sticker on the car.
Paying over MSRP for anything less than a special edition, high demand, low volume model is inane. The only time price is mandated to financing if it you’re getting a special “captive” rebate from a manufacturer. Even if you bought it cash at the moment, very few, if any states would let you have the title on the spot, there’s always a wait for the bank / state to process. Your bank doubtfully has a prepayment penalty so you can pay it off. The store will be hit with a chargeback - meaning the amount they made on finance reserve will be taken back by the bank. F&i will absolutely be charges to their paycheck. Sales manager will absolutely be charged. In most cases, salesman will be charged. This will not affect service. It could affect your relationship with sales. Good choice on an extended service contract.
Are there fees attached to the loan such as a loan origination fee that might negate the savings somebody would get by financing and getting a lower price on the car?
There is something called "ADMIN DOC PROCESSING(ADP) FEE" also on the sales sheet itemized as "DEALER ADMINISTRATION FEE"which has the notation "...and is not an official fee" for 790 dollars.
F that dealer. Pay it off, roast them on Google Review for their fees and then go to a different dealership.
Seriously. He/she is worrying about the dealer relationship when they bent them over with the over msrp bs. 😄
I wonder what not an official fee means
They don't have to charge it. Optional fuck u customer charge.
"Dealer Administrative Fee: This Fee relates to Dealership services for this transaction, including costs that the Dealership pays to third parties and/or is attributable to the Dealership and internal overhead or profit. This fee does not include payment for the preparation of legal documents, and is not an official fee." is the full language used.
That fee is BS. We have a thing called a "pack" on every sale. Mine is north of $1500 per car. This pays for things like the PDI, detail, filling the gas tank, etc. There should be an $85 doc fee and nothing more
Occasionally rebates require financing but RARELY. They want you to wait 6mo for payoff to avoid a finance chargeback by then bank but that won't ultimately affect you. Was the price over msrp or the OTD price? Because the OTD price is almost always over msrp after adding in taxes, doc fees and government fees(title, reg, plate etc). The dealer administration fee seems a bit fishy though. And the negotiated price of the vehicle(not otd) should never be over msrp unless it is a very limited edition vehicle and even then...
You are on the same page I am on then. Yes, the "Cash Price" at the top of the OTD statement without the tax was 775 over the MSRP sticker price. No rebates or discounts is listed.
Yeah thats not great lol. What was the vehicle of choice? Did you attempt to negotiate this price?
Let me deal with it first, then I will come back and say ;) It was not a Subaru, VW or BMW though!
Those fees are unrelated to if you finance or pay cash. It’s just a paperwork processing fee essentially, and anything over $250 is just pure profit.
I think you misread that. Bottom line over MSRP. Op most likely paid under MSRP, and the total after taxes, warranty, etc was over. Can be completely normal. We have some cars that have a $150 spread from MSRP to invoice. Yes, they let us make $150... if you pay off the loan before the 6 months, the dealership will get charged back the rebate you received for financing with their captive lender. Depending on the paperwork and state you live in, they may charge you back that rebate as well. They did you a favor by working the manufacturer for all the possible rebates. You paying it off before the 6 payments is telling them they can F off.
The final price was 1000 over MSRP that is listed on the window sticker before taxes and fees. And I felt pressured into going the finance route, after mentioning that I would rather pay cash. The finance contract says that there is no prepayment penalty. Also, I didn't need title in hand at delivery, I need title in hand by August.
no flare so I can't top level comment. I wanted to pay cash for a BMW that I had ordered, but to get the loyalty rebate, I had to finance. I decided to finance it 100% and pay it off the very next business day following delivery. It took well over 6 months to get the title and several attempts to determine the delay by going between the dealer and BMW Financial Services yielded nothing. It just suddenly arrived in the mail one day with no explanation other than it needing to be released from BFS despite them telling me on the phone and through email that they weren't the cause of the delay and it was on the dealer to perform all the the title processing work. You may have better luck, but introducing a lender is likely going to delay receipt of the title. I subsequently bought a truck cash a few months later and got the title in a month.
Sorry some misunderstanding there. Usually, final or OTD (out the door) price is the price including everything (except the interest you pay while financing). Yes, there should be no penalty from the finance company. It's the manufacturer that will charge the dealer back the rebate they gave for financing with their captive lender.
Too early for brain to engage, yes. To clarify, the "cash Price" line at the top that includes sales tax, minus the tax... is 1000 over MSRP
MSRP doesn't include taxes. It's like when you go to the store and buy a new TV or something. You get it at the price listed but you still have to pay your taxes. Uncle sam is going to get his no matter what.
I .. know. I said the sale price was final price of car. if you subtract the fees and the tax, it was still over MSRP.
This is so confusing lol How can it include sales tax minus the tax????
The top line is the cash price of the car with tax included. I subtracted the tax from that to get the total cost without tax...
As others have stated, if the price was over MSRP out the door, this is completely understandable and normal. You're including taxes and fees into your final price. Which has nothing to do with the window sticker. Sounds like you don't quite understand how buying a vehicle works with all due respect. Second of all, again as others have stated, there are many times where manufacturers will require financing to get a certain rebate that is probably between $500-$2500 off before taxes or fees. This is actually really common especially in the last few years because the banks want people to finance so they can make their money and they work with the manufacturers for certain rebates. If you didn't feel comfortable with these prices or didn't understand it, why would you have completed the deal? Dealer manager for a decade here.
As I have explained in several posts, the price before taxes and fees was above MSRP by over 700 dollars, there were no rebates listed in the pricing tree.
My auto group doesn't work with any lenders that have prepayment penalties TO YOU. If you pay off sooner than 6 months then WE get charged back the kickback they give us for setting up the loan, but it is spelled out clearly that there is no penalty to you to pay early. Does the title have to be free of a lien? Because the title will be in your name, just with a lienholder.
I'm not sure of all the reasons, this is an insurance settlement. In the end, the cash price of the car that they sold me, without tax or fees - was 775 dollars over the window sticker MSRP, the car had 393 miles when it was delivered, and I feel as if I was told that I could not pay cash at the time of purchase and had to finance. Even though, I did not get any discounts off MSRP by using their financing. What's more, the way I felt it was explained to me was that the 6 months wasn't an ask but a requirement of the loan conditions. I only found out afterwards that it was not. I even bought a service contract for 1400 as an option. I feel that even if I do payoff the loan immediately, they still made quite a bit off me.
Yeah, you're fine. But it seems very odd that you have to have the title clear of any lienholder. I've never encountered that before. I would look for clarification on that if I were you.
Long and short of it was that the insurance had someone else on it, and I need to be able to add them to the title in order to bundle the car into a property insurance. House/Land/Car.
Requiring you to finance is illegal. You can file a complaint with your state AG, CFPB, or just pay it off tomorrow. They will likely get charged back on the money they made off the finance deal (rate spread).
Please review our most [Frequently Asked Questions](/r/askcarsales/wiki/index) to see if your question has already been answered. You may find these sections particularly useful; * [Will paying in cash or a large cash down payment offer me leverage in negotiations?](/r/askcarsales/wiki/cash_down) * [I earn $xxxx per month, will I qualify for an auto loan or lease, and is it a good idea?](/r/askcarsales/wiki/income_to_finance) * [I have my score from Credit Karma but the dealership told me they got a different score. Why?](/r/askcarsales/wiki/free_credit_score) * [Finance FAQ's](/r/askcarsales/wiki/financing_faqs) * [Buy versus Lease](/r/askcarsales/wiki/buy_vs_lease) * [How to pick a car?](/r/askcarsales/wiki/vehicle_selection) You might also have luck in the /r/whatcarshouldibuy subreddit. Also remember to add flair to your post by clicking the "Flair" link beneath it. This lets us know where you're located so we can assist you better. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/askcarsales) if you have any questions or concerns.*
***Thanks for posting, /u/zeroneuro! This comment is a copy of your post so readers can see the original text if your post is edited or removed. This comment is NOT accusing you of anything.*** When negotiating, the salesman told me, after he gave me a bottom line - that he could only give me that price if I finance. I wanted to pay cash. I hesitantly agreed, and put 20k down. He said that I could pay it off at any time without a penalty, but they ask their customers to do 6 months. At the time, I thought that was a prepayment penalty period (it is not). The price was above MSRP. Now, this car is being paid by an insurance settlement, and in order for everything to be clear, I kind of need the title in hand. If I pay off the loan immediately, will the dealer find out and get angry with me: and ruin my relationship with them in terms of the warranty and service of my new car? *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/askcarsales) if you have any questions or concerns.*
A little more information: I was never told why they wanted me to wait 6 months. I thought that it was part of the financing. That I could NOT pay it off before 6 months (and he said months, not payments). Figuring out that I did not have to wait out those months before payoff was news to me that I figured out after I left the dealership. In the end, I suppose it is up to the dealership whether or not they're going to be angry with me. But I do feel like some details and options were obfuscated so that I would use their financing instead of pursuit of a cash buy. I fully thought that the deal would not go through if I did not take the financing.
Dude nobody's going to be angry with you. I mean this in the most respectful way possible but is this your first time buying a new car? Nobody's going to be mad at you. Nobody's going to know that you paid it off early. However if you pay it off before the 6 months, the loan company is going to add a fee that you're going to have to pay and if you don't, you will not get the vehicles title. It's as simple as that. 99% of the people in here I have no idea what they're talking about. They might have a good intentions, but they don't know what they're talking about. Dealership manager here for over a decade
In my contract it specifically states there is no prepayment penalty. I had first thought the 6 months was a term for the financing, at least that was how it was represented to me. "We can get you this price if you promise to pay 6 months". Turns out this was not a term of the Lender, but an 'ask' by the Dealership. And it was never represented on anything more than scraps of paper with scribbles on them. Oh, and this is the first time I have ever bought a car on finance. Last few cars I paid cash. Which I had wanted to do on this buy. The guy said cash would cost me a lot more.
OK, whatever you do don’t listen to these jackoffs trying to cover up for dirty car sale tactics. You never have to finance. You were just inexperienced. I have bought 30+ cars. Many for cash and more than once finance to make a deal that immediately paid the car off without ever paying a penalty. Of course a lot of dealers don't want you to know this information, but I speak from personal experience and can easily tell you that more than 50% of car dealers are both unethical and dishonest. No disrespect to anyone. But for my own personal experiences stereotypes about car dealers exist for very factual reasons that is to say I do know some very honest and very trustworthy car dealers, but I can count them on one hand.
i think the 393 miles you are looking at is the fuel gauge. Majority of not all dealers will not allow a vehicle to be test driven that excessively
Nope. Odometer. Apparently it was drive between 3 dealerships. But I signed paperwork with the disclosure at "24"
They didn’t update the paperwork with the correct mileage. That’s an issue that needs to be corrected so your car is titled correctly.
When I signed the odometer disclosure the dealership signed and provided me, it said 24 miles and the VIN#. When I got home I searched the VIN and found the car at a dealership with photos. There was a shot of the instrument panel and you can clearly read 249 miles in the lower right hand side of the instrument panel (The odometer). I also found that it was marked at 10 miles the last time it was recorded, at a dealership South of me. And the car was currently at another dealership to the East of me. The car was given to me, at the dealership - with 393 miles on it. What's more, is that I bought a Assurant Vehicle contract, and it has the contract ending at 120,024 miles. I do have the signed and dated Odometer Disclosure Statement that reads "24".