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Car buying advice...

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Car buying advice...

Old 04-27-16, 11:47 AM
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Car buying advice...

I have a quick question about buying a new car. In the past, I have always financed through the dealership and then after the fact I would immediately refinance with my credit union. I am pretty sure that I lose some money when the loan is transferred/refinanced by doing it this way. However, I have always thought that this allowed me to get the best deal from the dealership because they are more willing to give you a break on the vehicle and other options if you finance through them. However, I am far from an expert on this and I could be 100% off base.

Should I have my credit union prepared to finance the loan before heading to the dealership or is waiting until after the smarter play?

Thanks for your help!
Old 04-27-16, 11:49 AM
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Re: Car buying advice...

I'd check to see what the best rate your credit union can give you and ask the dealer if they can match it. They probably will since they get a kickback for in-house financing. If not, go with your own loan. You really should be coming to agreement on the purchase and trade in prices prior to discussing loan options.
Old 04-27-16, 11:52 AM
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Re: Car buying advice...

I'd be surprised if they would give you a break that could be circumvented by immediately paying them off with your own financing.

Also, most places have cash incentives that save you money, rather than financing through them.
Old 04-27-16, 12:02 PM
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Re: Car buying advice...

The only time I finance through manufacturer financing is if there is a related rebate associated with it (and the rate is is the same as outside financing). The last time I did that was through Chrysler financing since they had an additional $1500 rebate for using them and they were able to match the best rate from a competing bank.

Always best to have something in place before you go. I NEVER discuss financing until I have a deal in place. Also, never answer when they ask "How much do you want to spend?" or "How much can you pay a month?" Dealers can get awful creative with numbers when you give them an opening.
Old 04-27-16, 12:17 PM
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Re: Car buying advice...

My experiences have been there are almost always some sort of incentives/rebate with financing through the dealer. Even if tell them you're going to pay off the loan immediately after, most dealers don't care. As far as they're concern, they sold the vehicle to you with financing. What you do after is your business. But yeah, have your credit union loan ready, so you have the options of either go with your dealer's financing if there is an incentive/rebate or go with your credit union if there isn't.
Old 04-27-16, 12:28 PM
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Re: Car buying advice...

Great, thanks for the advice everyone!
Old 04-27-16, 12:29 PM
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Re: Car buying advice...

All they care about is selling the car. I don't think financing with them matters.

It's good to know what rates your bank has to offer. The dealer having a finance guy on site is get customers to commit on the spot. The old "I have to check with my bank" allows customers to leave. Dealers finance with dozens of different banks. That's typically because of credit scores. The dealer won't finance someone with 575 credit score, but another bank will.

I purchase Honda's. Sometimes Honda offers a great rate, sometimes an outside bank has a better rate. There are positives and negatives to financing through the car brand. For example I financed my Accord with Honda. When I asked about trade in value they were able to look up my payoff amount. I feel they based their offer slightly over that amount. If I finance through another bank, as I did with our Odyssey, they wouldn't have access to that info, which may have lead to a better trade in value.

As others have mentioned, financing shouldn't be discussed during the deal. But you can call and get a range on rates.

You can ask if they will match a better interest rate but in my experience they won't. The guy at the dealer is just there for paperwork. He can't make final decisions on interest rates.

You mentioned buying a new car so this won't apply to you, but I find it best to buy a used car from the brand you prefer. If you want a Honda, buy from Honda.

Good luck.
Old 04-27-16, 01:08 PM
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Re: Car buying advice...

Originally Posted by andicus View Post
I'd be surprised if they would give you a break that could be circumvented by immediately paying them off with your own financing.

Also, most places have cash incentives that save you money, rather than financing through them.
I've had them tell me to do this.

However, I think the best way to go is to tell them what rate you are getting from your credit union. They always beat the rate.

When I bought a suburu I got turned down by CapitalOne for a loan for some reason. So I got one from US bank and took to to the dealership. They saw the rate and wrote the loan themselves saying that they would get the new rate they got me or have to keep the loan themselves. CapitalOne bought the loan. Odd deal.
Old 04-27-16, 01:20 PM
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Re: Car buying advice...

Originally Posted by kvrdave View Post
When I bought a suburu I got turned down by CapitalOne for a loan for some reason. So I got one from US bank and took to to the dealership.
Well, well, well, life in Daveville is not so pleasant after all, ehh? Although I'd have taken doo doo to the dealership instead of to to.
Old 04-27-16, 01:38 PM
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Re: Car buying advice...

First, there is no easy answer. It varies greatly.

2nd, if at all possible buy your car on line and don't jack with it in person.

Financing, I recommend always having financing already done. That way they can't hold it over your head.

But, yes, to get the best deal, the dealer very well may FORCE you to finance thru them. This happened with my Jeep Wrangler. Even tho I called first and verified they had the jeep and I could pay cash for,the advertised price, when I went in they suddenly "didn't have that one" and would only order me one at that price if I financed. And they wouldnt tell me the rate until I agreed to all that and they checked my credit. I refused and walked away.

I ended up ordering an paying cash (plus small finance amount thru my CU) rough a fleet dealership.

Yet, when I went to buy my sons car, a Ford Focus I walked in and 10 minutes later had the paper work written for the advertised, very good price. The salesman than said, you can pay this and we are done or if you finance through use will take another $1,500 off. I did that. I was required to make 3 payments, but then paid off the loan and received the title a week later. THAT was a really good deal. But more importantly hassle free.

The issue of course is there are no more secrets. It is relatively easy for anyone to find a "true cost" to the dealer of a vehicle. In the past, consumers would start at MSRP and work down. Now consumers start at "invoice" and work down. So dealers are finding more ways to make more money. Window tinting, undercoating, scotch guarding, and the biggestest one's, trade ins and financing.

I had a miserable experience buying my Wrngler. And while some like them, I don't recommend using "True Cars" and those type places. Now, 6 months later, I still get calls from dealers.

I love the Tesla model. And as soon as Amazon starts selling vehicles it will put out of business these 1970 era dealerships.
Old 04-27-16, 01:47 PM
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Re: Car buying advice...

Originally Posted by SuperJim88 View Post
Well, well, well, life in Daveville is not so pleasant after all, ehh? Although I'd have taken doo doo to the dealership instead of to to.


There's a lot of shit in Daveville.
Old 04-27-16, 02:00 PM
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Re: Car buying advice...

Originally Posted by VitiminJ View Post
All they care about is selling the car. I don't think financing with them matters.

It's good to know what rates your bank has to offer. The dealer having a finance guy on site is get customers to commit on the spot. The old "I have to check with my bank" allows customers to leave. Dealers finance with dozens of different banks. That's typically because of credit scores. The dealer won't finance someone with 575 credit score, but another bank will.

I purchase Honda's. Sometimes Honda offers a great rate, sometimes an outside bank has a better rate. There are positives and negatives to financing through the car brand. For example I financed my Accord with Honda. When I asked about trade in value they were able to look up my payoff amount. I feel they based their offer slightly over that amount. If I finance through another bank, as I did with our Odyssey, they wouldn't have access to that info, which may have lead to a better trade in value.

As others have mentioned, financing shouldn't be discussed during the deal. But you can call and get a range on rates.

You can ask if they will match a better interest rate but in my experience they won't. The guy at the dealer is just there for paperwork. He can't make final decisions on interest rates.

You mentioned buying a new car so this won't apply to you, but I find it best to buy a used car from the brand you prefer. If you want a Honda, buy from Honda.

Good luck.
I am a Honda guy as well. I decided to call my CU and they have me all set to be financed through them. Now when I go in, I can just pick the better financing deal. I usually like to get used cars as well, but not more than 1-2 years (and always certified). Unfortunately, anything before the 2015 version has a design that I am not that fond of, and it looks like the price difference is between a 2015 and 2016 is minimal and practically nonexistent once you calculate the APR differences between buying new and used)...
Old 04-27-16, 02:28 PM
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Re: Car buying advice...

Impossible to answer without seeing all the numbers.

Bought down dealer financing via a bank may be a better choice however, you need to run both payments and look at the terms.
Old 04-27-16, 03:02 PM
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Re: Car buying advice...

I'd find the car I wanted online, research pricing, and then tell them to give their best offer ONLINE after telling them you will be paying cash. If the price isn't right, fuck em. Try another dealer. After a couple weeks, they'll all be throwing offers around in desperation.

Originally Posted by andicus View Post
I'd be surprised if they would give you a break that could be circumvented by immediately paying them off with your own financing.

Also, most places have cash incentives that save you money, rather than financing through them.
Yes, my wife bought a Lexus and was going to pay cash and the dealer said that you can only get incentives if you finance at least 10K for 1 year. So she did that and we paid off that 10K as soon as the year ended.

But regardless, these guys are all sheisters and will be making all kinds of offers toward the end of the month.
Old 04-27-16, 03:22 PM
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Re: Car buying advice...

As has been pointed out, there is no certainty. However it has been my experience that dealer-initiated financing will lower the negotiated price. Yes, they most definitely make extra money on that. Those worthless warranties are another negotiating tactic (e.g., knock off $400 if you buy the $500 warranty).

Same goes for a trade in (since they will be making money off of it as well). I once negotiated a price with a trade-in, got the price (not terms) in writing, and then decided to keep the trade-in. Dealer was pissed, but that was his mistake not mine.

Arm yourself with every bit of leverage you can. Yes, they (unfair over-generalization) are there to make money but they will bleed a 90-year old widow dry. You should do the same to them.
Old 04-28-16, 09:30 AM
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Re: Car buying advice...

I bought a cpo through the dealership and they offered me 0.9% apr, which is cheaper than what any credit union would offer so I went with that.

Depends on the deal of course
Old 04-28-16, 10:39 AM
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Re: Car buying advice...

Originally Posted by CRM114 View Post
I'd find the car I wanted online, research pricing, and then tell them to give their best offer ONLINE after telling them you will be paying cash. If the price isn't right, fuck em. Try another dealer. After a couple weeks, they'll all be throwing offers around in desperation.



Yes, my wife bought a Lexus and was going to pay cash and the dealer said that you can only get incentives if you finance at least 10K for 1 year. So she did that and we paid off that 10K as soon as the year ended.

But regardless, these guys are all sheisters and will be making all kinds of offers toward the end of the month.
Actually, I meant the opposite.

Our deals tend to be along the lines of

1) 0.9% financing
or
2) $1500 cash incentive

Sometimes there will be a separate lease offer, as well.

So if you finance, you don't get the $1500 discount.
Old 04-28-16, 10:56 AM
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Re: Car buying advice...

The last time I bought a car, the dealer gave me a $1000 incentive to finance thru them, but he told me right up front that it wouldn't be the best rate, and advised me to pay on it for 3 months (which were the terms of the incentive) and refinance it thru a credit union, so that's what I did.
Old 04-28-16, 11:06 AM
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Re: Car buying advice...

Best thing to remember when buying a car? They need your money more than you need their car. If they don't give you the deal you want, walk away. So few people do this, no wonder dealers try to jerk everyone around. It works for them!
Old 04-28-16, 11:08 AM
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Re: Car buying advice...

I've only ever used dealership financing when there was an incentive that worked out in my favor. The last one gave me a $1500 incentive if I took their financing at a 0% rate, and I had to hold it for 3 months before paying off.
Old 04-28-16, 12:17 PM
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Re: Car buying advice...

Originally Posted by CRM114 View Post
I'd find the car I wanted online, research pricing, and then tell them to give their best offer ONLINE after telling them you will be paying cash.
I tried this too with little success. Once he said he couldn't accept my offer a friend of mine gave me the name of another person at the same dealership. I contacted him and made the very same offer. He approved the price right away. When I went in to sign the papers I asked him why he could get the price and not the online guy. His answer was the online guy is new and the dealership doesn't have a lot of confidence that they will sell another car to make up the difference. His car buying advice was to request to speak with the Sales Manager and ask to work with the salesman with the most experience. They will always be able to get a better deal because they've been successful in the past. Not sure how true it is, but I took his advice when we bought our next car. The offer was approved on the spot. Come to think of it. maybe I'm offering too much?
Old 04-28-16, 12:24 PM
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Re: Car buying advice...

Originally Posted by Abob Teff View Post

I once negotiated a price with a trade-in, got the price (not terms) in writing, and then decided to keep the trade-in. Dealer was pissed, but that was his mistake not mine.
I did the opposite. We agreed on a price with no trade in. But the car didn't fetch as much as I had hoped on Craigslist. So I showed up with the car to sign the papers. And oh yeah I have a trade in now. They offered me lower than the written offer in my pocket. But they matched it once I showed them. They didn't seem too bent, but the manager came over and said he was impressed.
Old 04-29-16, 02:24 PM
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Re: Car buying advice...

I don't offer shit. I tell them to give me their lowest price. Then I tell that price to a different dealership, asking them to beat the price. Go back and forth until I get a price I agree with.
Old 04-29-16, 02:40 PM
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Re: Car buying advice...

lube up your asshole and bend over
Cars is one last places in America that almost everyone gets ripped off

Cant wait until I can just buy a car off amazon, click and it shows up same day

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