Car financing denied after 2 weeks

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dknightd
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Re: Car financing denied after 2 weeks

Post by dknightd »

Might be time for a road trip ;)
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KyleAAA
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Re: Car financing denied after 2 weeks

Post by KyleAAA »

Elysium wrote: Sat Dec 14, 2019 12:14 pm
KyleAAA wrote: Sat Dec 14, 2019 12:05 pm
Elysium wrote: Sat Dec 14, 2019 12:02 pm
KyleAAA wrote: Sat Dec 14, 2019 11:44 am
Elysium wrote: Sat Dec 14, 2019 10:36 am Am I in the minority here that is not getting why this is a scam or a game by the dealer? what are they benefiting by taking back a car that is now two weeks old, on the road probably over 500 plus miles based on average driving patterns. They are having to void a sale and now try to sell this car back in the market, at a discount since the car has miles on it. If anything they are losing money on the deal.

As for the trade-in, since OP's son decided to trade it in regardless of this car or another car, the price he received it were all negotiated fairly presumably. That is a separate deal, he is done with it and I assume he is getting the full money of the trade in.

Unless, there is more to the story than reported in the OP.
The car was not titled yet, so it is still new. They will not have to sell it at a discount. It’s very common for new cars to have over 1000 miles on them.
I would ask for a discount if i see 1000 miles on a new car. Typically they will have to offer a discount in a competitive market. But I guess that is not what they are thinking here obviously based on follow-up posts, instead trying to scam the customer into accepting a higher finance rate.

I would secure money before going back in for any discussions with this dealer. OP should either find cash payment or an outside pre-approved check from credit union/bank.
You wouldn’t get it. 99% of buyers wouldn’t ask. You can easily get over 1000 miles on a new car just from a few test drives and transferring it to another dealership.
That's not normal. If a car has 1000 miles that means it has been used for test drives. Transfer of autos happen by truck typically, and not driven. I recently bought a car with 4 miles on it, and the one before that just came off a truck from another dealer with 5 miles on it. I did once buy a car with 5000 miles on it that was untitled because it was given to a regional manager to drive, I got a large discount for it. That said, pricing is all local, in my area car market is very competitive, as people have flexibility to cross back and forth between 3 states to purchase within a 25 mile radius and the other state is always willing to offer large discount for coming over, as it is a bonus sale for them.
No, transfers between dealerships are typically driven unless it’s part of a large swap. For example, I bought a car in Atlanta that was driven up from Savannah. If I had decided not to move forward, that mileage would have still been on the car and it would still be new. Deliveries from the factory are done by truck, true. But there’s a lot of movement after that.
Elysium
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Re: Car financing denied after 2 weeks

Post by Elysium »

KyleAAA wrote: Sat Dec 14, 2019 12:41 pm
Elysium wrote: Sat Dec 14, 2019 12:14 pm
KyleAAA wrote: Sat Dec 14, 2019 12:05 pm
Elysium wrote: Sat Dec 14, 2019 12:02 pm
KyleAAA wrote: Sat Dec 14, 2019 11:44 am

The car was not titled yet, so it is still new. They will not have to sell it at a discount. It’s very common for new cars to have over 1000 miles on them.
I would ask for a discount if i see 1000 miles on a new car. Typically they will have to offer a discount in a competitive market. But I guess that is not what they are thinking here obviously based on follow-up posts, instead trying to scam the customer into accepting a higher finance rate.

I would secure money before going back in for any discussions with this dealer. OP should either find cash payment or an outside pre-approved check from credit union/bank.
You wouldn’t get it. 99% of buyers wouldn’t ask. You can easily get over 1000 miles on a new car just from a few test drives and transferring it to another dealership.
That's not normal. If a car has 1000 miles that means it has been used for test drives. Transfer of autos happen by truck typically, and not driven. I recently bought a car with 4 miles on it, and the one before that just came off a truck from another dealer with 5 miles on it. I did once buy a car with 5000 miles on it that was untitled because it was given to a regional manager to drive, I got a large discount for it. That said, pricing is all local, in my area car market is very competitive, as people have flexibility to cross back and forth between 3 states to purchase within a 25 mile radius and the other state is always willing to offer large discount for coming over, as it is a bonus sale for them.
No, transfers between dealerships are typically driven unless it’s part of a large swap. For example, I bought a car in Atlanta that was driven up from Savannah. If I had decided not to move forward, that mileage would have still been on the car and it would still be new. Deliveries from the factory are done by truck, true. But there’s a lot of movement after that.
Again, this is not a one size fits all rule. A lot of that varies between dealers and states. Dealers in my area typically get transfer by truck and they bear the cost. My last car purchased was transferred from another state 200+ miles away, and it came on a truck all by itself. I just saw the driver pulling in and bringing the car down from the truck before I went in and finished purchase. It all depends on the local market.
KyleAAA
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Re: Car financing denied after 2 weeks

Post by KyleAAA »

Elysium wrote: Sat Dec 14, 2019 12:49 pm
KyleAAA wrote: Sat Dec 14, 2019 12:41 pm
Elysium wrote: Sat Dec 14, 2019 12:14 pm
KyleAAA wrote: Sat Dec 14, 2019 12:05 pm
Elysium wrote: Sat Dec 14, 2019 12:02 pm

I would ask for a discount if i see 1000 miles on a new car. Typically they will have to offer a discount in a competitive market. But I guess that is not what they are thinking here obviously based on follow-up posts, instead trying to scam the customer into accepting a higher finance rate.

I would secure money before going back in for any discussions with this dealer. OP should either find cash payment or an outside pre-approved check from credit union/bank.
You wouldn’t get it. 99% of buyers wouldn’t ask. You can easily get over 1000 miles on a new car just from a few test drives and transferring it to another dealership.
That's not normal. If a car has 1000 miles that means it has been used for test drives. Transfer of autos happen by truck typically, and not driven. I recently bought a car with 4 miles on it, and the one before that just came off a truck from another dealer with 5 miles on it. I did once buy a car with 5000 miles on it that was untitled because it was given to a regional manager to drive, I got a large discount for it. That said, pricing is all local, in my area car market is very competitive, as people have flexibility to cross back and forth between 3 states to purchase within a 25 mile radius and the other state is always willing to offer large discount for coming over, as it is a bonus sale for them.
No, transfers between dealerships are typically driven unless it’s part of a large swap. For example, I bought a car in Atlanta that was driven up from Savannah. If I had decided not to move forward, that mileage would have still been on the car and it would still be new. Deliveries from the factory are done by truck, true. But there’s a lot of movement after that.
Again, this is not a one size fits all rule. A lot of that varies between dealers and states. Dealers in my area typically get transfer by truck and they bear the cost. My last car purchased was transferred from another state 200+ miles away, and it came on a truck all by itself. I just saw the driver pulling in and bringing the car down from the truck before I went in and finished purchase. It all depends on the local market.
Yes, it depends on the local market. But in 95% of local markets, they are driven and 1000 miles is normal.
DesertDiva
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Re: Car financing denied after 2 weeks

Post by DesertDiva »

Kuna_Papa_Wengi wrote: Sat Dec 14, 2019 10:03 am As others have said, this is a common scam. I would call your state's AG office to see if they can help.
This would be my first choice. Follow up in writing.
njdealguy
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Re: Car financing denied after 2 weeks

Post by njdealguy »

If it were me to teach them a lesson assuming have time I'd drive the car across the country coast to coast and back before returning it, should force them to discount it at least 5-10% further to next buyer (maybe being then considered a "demo" model) :D
Elysium
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Re: Car financing denied after 2 weeks

Post by Elysium »

KyleAAA wrote: Sat Dec 14, 2019 12:52 pm
Elysium wrote: Sat Dec 14, 2019 12:49 pm
KyleAAA wrote: Sat Dec 14, 2019 12:41 pm
Elysium wrote: Sat Dec 14, 2019 12:14 pm
KyleAAA wrote: Sat Dec 14, 2019 12:05 pm

You wouldn’t get it. 99% of buyers wouldn’t ask. You can easily get over 1000 miles on a new car just from a few test drives and transferring it to another dealership.
That's not normal. If a car has 1000 miles that means it has been used for test drives. Transfer of autos happen by truck typically, and not driven. I recently bought a car with 4 miles on it, and the one before that just came off a truck from another dealer with 5 miles on it. I did once buy a car with 5000 miles on it that was untitled because it was given to a regional manager to drive, I got a large discount for it. That said, pricing is all local, in my area car market is very competitive, as people have flexibility to cross back and forth between 3 states to purchase within a 25 mile radius and the other state is always willing to offer large discount for coming over, as it is a bonus sale for them.
No, transfers between dealerships are typically driven unless it’s part of a large swap. For example, I bought a car in Atlanta that was driven up from Savannah. If I had decided not to move forward, that mileage would have still been on the car and it would still be new. Deliveries from the factory are done by truck, true. But there’s a lot of movement after that.
Again, this is not a one size fits all rule. A lot of that varies between dealers and states. Dealers in my area typically get transfer by truck and they bear the cost. My last car purchased was transferred from another state 200+ miles away, and it came on a truck all by itself. I just saw the driver pulling in and bringing the car down from the truck before I went in and finished purchase. It all depends on the local market.
Yes, it depends on the local market. But in 95% of local markets, they are driven and 1000 miles is normal.
That's just a big claim with no basis. You may have knowledge on your local market, even if you work in the industry and/or connected to auto dealership you wouldn't know rest of the 95% market. If someone is not getting a discount on a car with 1000 miles on it, then they need to sharpen their negotiation skills, and/or keep looking for better deals until they find one.
KyleAAA
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Re: Car financing denied after 2 weeks

Post by KyleAAA »

Elysium wrote: Sat Dec 14, 2019 1:28 pm
KyleAAA wrote: Sat Dec 14, 2019 12:52 pm
Elysium wrote: Sat Dec 14, 2019 12:49 pm
KyleAAA wrote: Sat Dec 14, 2019 12:41 pm
Elysium wrote: Sat Dec 14, 2019 12:14 pm
That's not normal. If a car has 1000 miles that means it has been used for test drives. Transfer of autos happen by truck typically, and not driven. I recently bought a car with 4 miles on it, and the one before that just came off a truck from another dealer with 5 miles on it. I did once buy a car with 5000 miles on it that was untitled because it was given to a regional manager to drive, I got a large discount for it. That said, pricing is all local, in my area car market is very competitive, as people have flexibility to cross back and forth between 3 states to purchase within a 25 mile radius and the other state is always willing to offer large discount for coming over, as it is a bonus sale for them.
No, transfers between dealerships are typically driven unless it’s part of a large swap. For example, I bought a car in Atlanta that was driven up from Savannah. If I had decided not to move forward, that mileage would have still been on the car and it would still be new. Deliveries from the factory are done by truck, true. But there’s a lot of movement after that.
Again, this is not a one size fits all rule. A lot of that varies between dealers and states. Dealers in my area typically get transfer by truck and they bear the cost. My last car purchased was transferred from another state 200+ miles away, and it came on a truck all by itself. I just saw the driver pulling in and bringing the car down from the truck before I went in and finished purchase. It all depends on the local market.
Yes, it depends on the local market. But in 95% of local markets, they are driven and 1000 miles is normal.
That's just a big claim with no basis. You may have knowledge on your local market, even if you work in the industry and/or connected to auto dealership you wouldn't know rest of the 95% market. If someone is not getting a discount on a car with 1000 miles on it, then they need to sharpen their negotiation skills, and/or keep looking for better deals until they find one.
It has a very specific basis. I am not wrong. I cannot provide proof without violating NDA. Take it or leave it.
TallBoy29er
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Re: Car financing denied after 2 weeks

Post by TallBoy29er »

dknightd wrote: Sat Dec 14, 2019 12:37 pm Might be time for a road trip ;)
A long, long, road trip. :D

This is a total BS situation. They sold your kid's car, and now want theirs back. Complaints would be lodged with: BBB, CFBP, State AG.

And that long road trip! :sharebeer
Elysium
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Re: Car financing denied after 2 weeks

Post by Elysium »

KyleAAA wrote: Sat Dec 14, 2019 1:32 pm
Elysium wrote: Sat Dec 14, 2019 1:28 pm
KyleAAA wrote: Sat Dec 14, 2019 12:52 pm
Elysium wrote: Sat Dec 14, 2019 12:49 pm
KyleAAA wrote: Sat Dec 14, 2019 12:41 pm

No, transfers between dealerships are typically driven unless it’s part of a large swap. For example, I bought a car in Atlanta that was driven up from Savannah. If I had decided not to move forward, that mileage would have still been on the car and it would still be new. Deliveries from the factory are done by truck, true. But there’s a lot of movement after that.
Again, this is not a one size fits all rule. A lot of that varies between dealers and states. Dealers in my area typically get transfer by truck and they bear the cost. My last car purchased was transferred from another state 200+ miles away, and it came on a truck all by itself. I just saw the driver pulling in and bringing the car down from the truck before I went in and finished purchase. It all depends on the local market.
Yes, it depends on the local market. But in 95% of local markets, they are driven and 1000 miles is normal.
That's just a big claim with no basis. You may have knowledge on your local market, even if you work in the industry and/or connected to auto dealership you wouldn't know rest of the 95% market. If someone is not getting a discount on a car with 1000 miles on it, then they need to sharpen their negotiation skills, and/or keep looking for better deals until they find one.
It has a very specific basis. I am not wrong. I cannot provide proof without violating NDA. Take it or leave it.
I have no reason to disbelieve you, so I will take your word for it. Although, I was always under impression cars with more than few miles on it should not be purchased without additional discounts, and our local markets have supported it. That said, I have only purchased 5-6 cars in my lifetime, so my data is limited by my experience.
chevca
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Re: Car financing denied after 2 weeks

Post by chevca »

dknightd wrote: Sat Dec 14, 2019 11:38 am OP has not followed up. I will not bother replying to somebody who does not reply to their original post. This strikes me as a useless waste of time and thought! New rule for me, the OP has to have posted more than once before I even bother.
I'm guessing the OP is testing the market to see what we will put up with, and how we would respond. It could be the OP is a car salesperson!
Agreed.

Assuming this wasn't a trolling post, it seemed pretty urgent the OP wanted to get something figured out. No follow up info or questions answered by the OP.... ugh... just a conversation among the rest of us, I guess.
wrongfunds
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Re: Car financing denied after 2 weeks

Post by wrongfunds »

Come on; the original was posted *today* morning! It is not as if it was posted last week.

I get the feeling that if this were about "how do I invest my $40M" topic, you guys would give OP much wider berth. May be it is human nature to look down on somebody who asks about their misfortune.

I know neither of those OPs personally, so I treat them the same but bunch of you do treat them very differently on this forum.
NewMoneyMustBeSmart
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Re: Car financing denied after 2 weeks

Post by NewMoneyMustBeSmart »

First you say....
rplaybird wrote: Sat Dec 14, 2019 8:47 am My son purchased a new vehicle at a local car dealership at 0% interest for 72 months.
Then you say...
rplaybird wrote: Sat Dec 14, 2019 8:47 am
The finance manager called him 2 weeks later and said they could not secure financing for him and they need the vehicle back.
If it was me I'd call the dealership manager with my son and say, "I'm recording this call, and I'm very sorry to hear about your problem getting the 0% financing syndicated that you sold my son. If you need information from us, let us know; we'll be happy to help you. You (the dealership) clearly sold the car to my son at the terms specified, so this is your problem not ours. Like I said, I'm happy to help. Please contact us by mail only from now on, and we will be happy to work with you. Thanks! Good bye. [click]"
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Teague
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Re: Car financing denied after 2 weeks

Post by Teague »

My goodness, all sorts of talk about hiding the car from repo agents, telling the dealership to pound sand because the car is mine Jack, and so on. I do hope OP will carefully read all paperwork that was signed before trying any of these DIY remedies. I'll bet the title never transferred to the buyer, so they don't own the car, though it may be in their possession currently. Contrary to the old saying, I believe possession is not 9/10 of the law. Of course, if an attorney would care to tell me that possession is indeed some fraction of the law, I'd love to know that. And also what that fraction is, assuming it's a rational number.
Last edited by Teague on Sat Dec 14, 2019 6:29 pm, edited 1 time in total.
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chevca
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Re: Car financing denied after 2 weeks

Post by chevca »

wrongfunds wrote: Sat Dec 14, 2019 5:13 pm Come on; the original was posted *today* morning! It is not as if it was posted last week.

I get the feeling that if this were about "how do I invest my $40M" topic, you guys would give OP much wider berth. May be it is human nature to look down on somebody who asks about their misfortune.

I know neither of those OPs personally, so I treat them the same but bunch of you do treat them very differently on this forum.
Apples and oranges comparison there. One can post Saturday morning and go do whatever they want for the weekend, the other not so much....

I'm guessing the OP wants to figure this car thing out ASAP, as in today or this weekend. Some more interaction would be great.

No one is looking down on anyone.
rberg922
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Re: Car financing denied after 2 weeks

Post by rberg922 »

I'm confused as to how he was able to drive the car off the lot without the financing secured?

Wouldn't you sign the appropriate documents saying the amount owed and the term, etc before you drive off?
Jack FFR1846
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Re: Car financing denied after 2 weeks

Post by Jack FFR1846 »

Look up "Spot Delivery" or "Yo-Yo Delivery". In some states, this is illegal. One good explanation wrt Florida (a search turns up specific state treatments)

https://www.ftc.gov/sites/default/files ... -80228.pdf
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Minty
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Re: Car financing denied after 2 weeks

Post by Minty »

Grt2bOutdoors wrote: Sat Dec 14, 2019 10:18 am
chevca wrote: Sat Dec 14, 2019 10:12 am I think the word "scam" being used is a little strong. I'm sure folks don't mean it as such, but the dealer isn't doing anything illegal. They're just playing the game to try and pad their bank account, so to speak. It's not cool, IMO, but also well known and happens all the time.
You should treat the dealer as you would a thief or a crook. They are there to “steal” your money.
It is only a scam in that they are deliberately lying in order to cheat the customer. It is not a scam in the sense that like, Bernie Madoff, they hoped to get away with it.
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Teague
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Re: Car financing denied after 2 weeks

Post by Teague »

rberg922 wrote: Sat Dec 14, 2019 8:29 pm I'm confused as to how he was able to drive the car off the lot without the financing secured?

Wouldn't you sign the appropriate documents saying the amount owed and the term, etc before you drive off?
Yes. But, here you also sign and agree to a "Seller's right to cancel" which states in part "you understand that it may take a few days for Seller to verify your credit and assign the contract."

That part goes on to say that if the financing doesn't go through, they get their car back and you get your money back. And "if you do not immediately return the vehicle you shall be liable for all expenses...." and so on.

I am speaking of my experiences in California.
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Dottie57
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Re: Car financing denied after 2 weeks

Post by Dottie57 »

MathIsMyWayr wrote: Sat Dec 14, 2019 10:53 am
Elysium wrote: Sat Dec 14, 2019 10:36 am Am I in the minority here that is not getting why this is a scam or a game by the dealer? what are they benefiting by taking back a car that is now two weeks old, on the road probably over 500 plus miles based on average driving patterns. They are having to void a sale and now try to sell this car back in the market, at a discount since the car has miles on it. If anything they are losing money on the deal.

As for the trade-in, since OP's son decided to trade it in regardless of this car or another car, the price he received it were all negotiated fairly presumably. That is a separate deal, he is done with it and I assume he is getting the full money of the trade in.

Unless, there is more to the story than reported in the OP.
Do I read it right? OP's son will end up donating his trade-in to the dealer.
Yep, that is what you read. Slimey dealership.
Freddy
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Re: Car financing denied after 2 weeks

Post by Freddy »

The dealer has to contribute to manufacture's 0% financing. They are kicking in up to a couple of thousand dollars to keep the rate low. They now want to make even more money off you by not paying into the loan and by trying to get you into a loan with interest. Don’t fall for it. They are doing what they had planned before you walked out of the dealership. Do you know your FICO score? Shop for a loan at a Credit Union and get a commitment from them and then buy a vehicle somewhere else, if you are returning the car. If they don’t have your trade in make sure you ask for the retail replacement cost of the trade. You don’t want to get screwed twice. Also, make sure you know what your trade is worth on the retail market. Check For comps on one of the online used car sites. Good luck. I hate shady dealers. I thought these practices were long gone, but I guess I was wrong.
KyleAAA
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Re: Car financing denied after 2 weeks

Post by KyleAAA »

NewMoneyMustBeSmart wrote: Sat Dec 14, 2019 6:10 pm First you say....
rplaybird wrote: Sat Dec 14, 2019 8:47 am My son purchased a new vehicle at a local car dealership at 0% interest for 72 months.
Then you say...
rplaybird wrote: Sat Dec 14, 2019 8:47 am
The finance manager called him 2 weeks later and said they could not secure financing for him and they need the vehicle back.
If it was me I'd call the dealership manager with my son and say, "I'm recording this call, and I'm very sorry to hear about your problem getting the 0% financing syndicated that you sold my son. If you need information from us, let us know; we'll be happy to help you. You (the dealership) clearly sold the car to my son at the terms specified, so this is your problem not ours. Like I said, I'm happy to help. Please contact us by mail only from now on, and we will be happy to work with you. Thanks! Good bye. [click]"
This is guaranteed to end in a repossession or possibly even arrest. Read the contract your son signed. It is his problem.

OP, go to reddit.com/r/askcarsales and ask your question there. You will get answers from people who actually know what they’re talking about.
KyleAAA
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Re: Car financing denied after 2 weeks

Post by KyleAAA »

Dottie57 wrote: Sat Dec 14, 2019 9:42 pm
MathIsMyWayr wrote: Sat Dec 14, 2019 10:53 am
Elysium wrote: Sat Dec 14, 2019 10:36 am Am I in the minority here that is not getting why this is a scam or a game by the dealer? what are they benefiting by taking back a car that is now two weeks old, on the road probably over 500 plus miles based on average driving patterns. They are having to void a sale and now try to sell this car back in the market, at a discount since the car has miles on it. If anything they are losing money on the deal.

As for the trade-in, since OP's son decided to trade it in regardless of this car or another car, the price he received it were all negotiated fairly presumably. That is a separate deal, he is done with it and I assume he is getting the full money of the trade in.

Unless, there is more to the story than reported in the OP.
Do I read it right? OP's son will end up donating his trade-in to the dealer.
Yep, that is what you read. Slimey dealership.
No, if OP’s son unwinds the deal he gets a check for the value of the trade in. Now, if OP’s son had negative equity in said car, he would need to pay that cash to the dealership to unwind the deal.
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White Coat Investor
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Re: Car financing denied after 2 weeks

Post by White Coat Investor »

rplaybird wrote: Sat Dec 14, 2019 8:47 am My son purchased a new vehicle at a local car dealership at 0% interest for 72 months. The finance manager called him 2 weeks later and said they could not secure financing for him and they need the vehicle back.

Not sure what to do here. He asked the dealership about getting his trade-in vehicle back but they told him that was not possible since it already had been sold at auction. Why would a dealership sell a trade-in vehicle at auction if they are not sure financing will go through.

Any help in this matter would be greatly appreciated.
Why not just go back and give them the cash you had saved up before deciding to take 0% financing to get an "arbitrage"? I mean, surely he didn't go buy a car without having the money did he?

I'd go back, thank them for the free two week rental, take my money from the trade-in and buy a beater while I saved up to buy my next car.
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criticalmass
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Re: Car financing denied after 2 weeks

Post by criticalmass »

rplaybird wrote: Sat Dec 14, 2019 8:47 am My son purchased a new vehicle at a local car dealership at 0% interest for 72 months. The finance manager called him 2 weeks later and said they could not secure financing for him and they need the vehicle back.

Not sure what to do here. He asked the dealership about getting his trade-in vehicle back but they told him that was not possible since it already had been sold at auction. Why would a dealership sell a trade-in vehicle at auction if they are not sure financing will go through.

Any help in this matter would be greatly appreciated.
A car dealer tried to do a similar stunt on a younger family member one time. She went to the dealer with me (in a different vehicle of course). I pulled out my camera (today a smart phone would work nicely) and when we got to the appropriate office, I clicked record and started narrating. ("We are here at the xyz auto dealership, where this dealer is suddenly trying to change the terms of a completed sale for the customer jane.... and started briefly narrating the back story, which got attention really fast.

When they asked who the hell I was, I responded, don't worry, I'm just a freelance reporter doing some true life publicity work on car dealer experiences for a local media outlet. Well they tried to get me to leave and I said sure, and my family member began to leave with me. That got them even more upset and they quickly learned it was both of us or none of us. The dealer person disappeared, and brought out someone else who then disappeared for a while.

I got out a book to read until they were done playing back room games, just like I do if buying a car and one actor keeps going to the backroom to talk to a "manager."

Finally, when they realized that we were both serious about making a gigantic issue over the attempted shenanigans, some guy with a suit appeared to apologize for the "misunderstanding" and gave my family member some new papers to sign. I said we'd be happy to look at the papers on our own time, run them by her attorney first, and have a nice day. They wouldn't let her leave with their new papers. So we just left, without them. And magically the dealer was able to stop the shenanigans. Too bad though, it would have made for some great video.

So when a dealer wants to play games, be sure to play a game. Just make sure you tell them what the rules are. Read the contract first of course.

----------------------------
See also:

https://www.nerdwallet.com/blog/loans/a ... deliveries

https://www.consumer.ftc.gov/search-ter ... -financing

https://www.ncconsumer.org/news-article ... -scam.html
Last edited by criticalmass on Sun Dec 15, 2019 2:07 am, edited 2 times in total.
criticalmass
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Re: Car financing denied after 2 weeks

Post by criticalmass »

White Coat Investor wrote: Sat Dec 14, 2019 11:26 pm
rplaybird wrote: Sat Dec 14, 2019 8:47 am My son purchased a new vehicle at a local car dealership at 0% interest for 72 months. The finance manager called him 2 weeks later and said they could not secure financing for him and they need the vehicle back.

Not sure what to do here. He asked the dealership about getting his trade-in vehicle back but they told him that was not possible since it already had been sold at auction. Why would a dealership sell a trade-in vehicle at auction if they are not sure financing will go through.

Any help in this matter would be greatly appreciated.
Why not just go back and give them the cash you had saved up before deciding to take 0% financing to get an "arbitrage"? I mean, surely he didn't go buy a car without having the money did he?

I'd go back, thank them for the free two week rental, take my money from the trade-in and buy a beater while I saved up to buy my next car.
A trade in value at a dealer is generally much less than what you could sell a car for. So you would effectively hand over your old car at a reduced price without the benefit of a decent purchase deal for a replacement car? And then (if you buy a new car) you are going to need to get rid of that beater, which is now worth far less as either a trade in or a sale than your original car you owned.

Meanwhile, you have to run around insuring a third/temporary car, getting it registered, getting it titled, possibly paying ad valorem taxes and/or local registration, getting it inspected, doing maintenance on it, fixing whatever issues were hidden on it, etc.

No thanks on this strategy.
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Re: Car financing denied after 2 weeks

Post by criticalmass »

duplicate
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Re: Car financing denied after 2 weeks

Post by Dottie57 »

KyleAAA wrote: Sat Dec 14, 2019 10:58 pm
Dottie57 wrote: Sat Dec 14, 2019 9:42 pm
MathIsMyWayr wrote: Sat Dec 14, 2019 10:53 am
Elysium wrote: Sat Dec 14, 2019 10:36 am Am I in the minority here that is not getting why this is a scam or a game by the dealer? what are they benefiting by taking back a car that is now two weeks old, on the road probably over 500 plus miles based on average driving patterns. They are having to void a sale and now try to sell this car back in the market, at a discount since the car has miles on it. If anything they are losing money on the deal.

As for the trade-in, since OP's son decided to trade it in regardless of this car or another car, the price he received it were all negotiated fairly presumably. That is a separate deal, he is done with it and I assume he is getting the full money of the trade in.

Unless, there is more to the story than reported in the OP.
Do I read it right? OP's son will end up donating his trade-in to the dealer.
Yep, that is what you read. Slimey dealership.
No, if OP’s son unwinds the deal he gets a check for the value of the trade in. Now, if OP’s son had negative equity in said car, he would need to pay that cash to the dealership to unwind the deal.
We have vastly different ideas of slimey.
Billionaire
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Re: Car financing denied after 2 weeks

Post by Billionaire »

This thread is downright maddening.
1. A brand new member uses this topic as his/her initial entry into the forum and hasn't reappeared.
2. Not sure how old the child is, but buying a vehicle with a 72 month (six years) loan is buying way too much automobile for anybody at any age.
3. No consumer should walk out of a auto dealer with a car and no finalized financing arrangement. It says a lot about both parties.
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Re: Car financing denied after 2 weeks

Post by Paddygirl »

I am shocked that the dealer has no responsibility here? This whole sham or scam should be illegal.
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Re: Car financing denied after 2 weeks

Post by RickBoglehead »

Billionaire wrote: Sun Dec 15, 2019 7:11 am This thread is downright maddening.
1. A brand new member uses this topic as his/her initial entry into the forum and hasn't reappeared.
2. Not sure how old the child is, but buying a vehicle with a 72 month (six years) loan is buying way too much automobile for anybody at any age.
3. No consumer should walk out of a auto dealer with a car and no finalized financing arrangement. It says a lot about both parties.
2) Pretty judgemental. 0 percent for 6 years.

3) You are uninformed about the buying process. At purchase, financing forms are completed and sent to the financial institution. There they are accepted, or not. This is standard. What is not normal is the scam of selling the trade in and then coming back to the customer with higher financing. All documents say subject to approval.
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Re: Car financing denied after 2 weeks

Post by White Coat Investor »

criticalmass wrote: Sun Dec 15, 2019 1:37 am
White Coat Investor wrote: Sat Dec 14, 2019 11:26 pm
rplaybird wrote: Sat Dec 14, 2019 8:47 am My son purchased a new vehicle at a local car dealership at 0% interest for 72 months. The finance manager called him 2 weeks later and said they could not secure financing for him and they need the vehicle back.

Not sure what to do here. He asked the dealership about getting his trade-in vehicle back but they told him that was not possible since it already had been sold at auction. Why would a dealership sell a trade-in vehicle at auction if they are not sure financing will go through.

Any help in this matter would be greatly appreciated.
Why not just go back and give them the cash you had saved up before deciding to take 0% financing to get an "arbitrage"? I mean, surely he didn't go buy a car without having the money did he?

I'd go back, thank them for the free two week rental, take my money from the trade-in and buy a beater while I saved up to buy my next car.
A trade in value at a dealer is generally much less than what you could sell a car for. So you would effectively hand over your old car at a reduced price without the benefit of a decent purchase deal for a replacement car? And then (if you buy a new car) you are going to need to get rid of that beater, which is now worth far less as either a trade in or a sale than your original car you owned.

Meanwhile, you have to run around insuring a third/temporary car, getting it registered, getting it titled, possibly paying ad valorem taxes and/or local registration, getting it inspected, doing maintenance on it, fixing whatever issues were hidden on it, etc.

No thanks on this strategy.
Yea good point, although I think a decent argument can be made for the dealership to reimburse you for the registration/taxes etc. If they won't do that, I'm not sure I'd be in any rush to bring it in. As someone said above, "Road Trip!"
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Re: Car financing denied after 2 weeks

Post by Grt2bOutdoors »

Minty wrote: Sat Dec 14, 2019 9:20 pm
Grt2bOutdoors wrote: Sat Dec 14, 2019 10:18 am
chevca wrote: Sat Dec 14, 2019 10:12 am I think the word "scam" being used is a little strong. I'm sure folks don't mean it as such, but the dealer isn't doing anything illegal. They're just playing the game to try and pad their bank account, so to speak. It's not cool, IMO, but also well known and happens all the time.
You should treat the dealer as you would a thief or a crook. They are there to “steal” your money.
It is only a scam in that they are deliberately lying in order to cheat the customer. It is not a scam in the sense that like, Bernie Madoff, they hoped to get away with it.
If a dealer sells me a car with 0% financing, hands me the keys and lets me drive off the lot with the car - they’ve sold me the car. If the driver of the car gets a letter in the mail saying to bring back the car, we can’t give you 0% financing- then the dealer has lied. And it is deliberate because the dealership knows in advance of the sale what their cost of funds is, they aren’t being truthful to the customer. Upon return of the car, they are hopeful the “owner” of the car will cave and take the higher cost financing to buy it. Scam!!! Of course they are cheating the customer. They are slime.
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Re: Car financing denied after 2 weeks

Post by Billionaire »

Folks, in today's business environment, if a dealership offers a 0% interest rate to me, I'm walking out of the place. That's a clear indication that some funny business is about to take place. Caveat emptor.

Regards,
Billionarie
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Re: Car financing denied after 2 weeks

Post by SmallCityDave »

Elysium wrote: Sat Dec 14, 2019 10:36 am Am I in the minority here that is not getting why this is a scam or a game by the dealer? what are they benefiting by taking back a car that is now two weeks old, on the road probably over 500 plus miles based on average driving patterns. They are having to void a sale and now try to sell this car back in the market, at a discount since the car has miles on it. If anything they are losing money on the deal.

As for the trade-in, since OP's son decided to trade it in regardless of this car or another car, the price he received it were all negotiated fairly presumably. That is a separate deal, he is done with it and I assume he is getting the full money of the trade in.

Unless, there is more to the story than reported in the OP.
I agree with you that it's probably not a scam BUT as far as the trade-in goes I wouldn't look at it as 2 separate transaction I would look at it as one because most people wouldn't do one without the other, the OP will also lose any tax benefit from the trade-in. Obviously the dealer has likely run into this issue before and the contract likely has it listed a 2 desperate transactions but if it were me I'd push back a bit.

Many years ago I was involved in a similar situation (but much simpler) a day or two after I bought and financed a new truck they called me and said that they made a couple of errors and they undercharged me by $500 or so, I would need to come back in and not to worry because all I had to do is sign a couple of documents and my payments would only go up by a few dollars... I told them that I wouldn't be worried because my payments would not be going up at all they quickly and not so politely explained that I signed this and that and if I didn't sign/pay the extra $500 I would need to return their truck I politely explained that they are welcome to come get their truck at their convenience, they called back 10 minutes later and said that they didn't need the $500 after all.
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Re: Car financing denied after 2 weeks

Post by SmallCityDave »

Billionaire wrote: Sun Dec 15, 2019 8:31 am Folks, in today's business environment, if a dealership offers a 0% interest rate to me, I'm walking out of the place. That's a clear indication that some funny business is about to take place. Caveat emptor.

Regards,
Billionarie
0% financing and CC rewards is how so many on this forum have become financially independent ;)
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Re: Car financing denied after 2 weeks

Post by RickBoglehead »

Billionaire wrote: Sun Dec 15, 2019 8:31 am Folks, in today's business environment, if a dealership offers a 0% interest rate to me, I'm walking out of the place. That's a clear indication that some funny business is about to take place. Caveat emptor.

Regards,
Billionarie
You are simply uninformed about auto financing. So Ford Motor Credit, offering 0% financing, is suspect? They are currently offering 0% for 60 months on a 2019 Ford Escape. This is commonly done. https://www.buyfordnow.com/detroit-ann- ... -billboard
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Re: Car financing denied after 2 weeks

Post by RickBoglehead »

Freddy wrote: Sat Dec 14, 2019 9:55 pm The dealer has to contribute to manufacture's 0% financing. They are kicking in up to a couple of thousand dollars to keep the rate low. They now want to make even more money off you by not paying into the loan and by trying to get you into a loan with interest. Don’t fall for it. They are doing what they had planned before you walked out of the dealership. Do you know your FICO score? Shop for a loan at a Credit Union and get a commitment from them and then buy a vehicle somewhere else, if you are returning the car. If they don’t have your trade in make sure you ask for the retail replacement cost of the trade. You don’t want to get screwed twice. Also, make sure you know what your trade is worth on the retail market. Check For comps on one of the online used car sites. Good luck. I hate shady dealers. I thought these practices were long gone, but I guess I was wrong.
Absolutely not true.

For example, Ford Credit offers dealers financing, including zero percent. The dealer gets a kickback/bonus from Ford if the customer makes 3 payments. Savvy buyers take the normal, unsubsidized rate, then either refinance or pay off the loan the next week. Dealer gets no bonus, but that's life.

Dealers can offer financing from their manufacturer, or shop loans via local banks. They very often will INCREASE, not decrease the rate to make even more money off deal.
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Re: Car financing denied after 2 weeks

Post by RickBoglehead »

Teague wrote: Sat Dec 14, 2019 9:33 pm
rberg922 wrote: Sat Dec 14, 2019 8:29 pm I'm confused as to how he was able to drive the car off the lot without the financing secured?

Wouldn't you sign the appropriate documents saying the amount owed and the term, etc before you drive off?
Yes. But, here you also sign and agree to a "Seller's right to cancel" which states in part "you understand that it may take a few days for Seller to verify your credit and assign the contract."

That part goes on to say that if the financing doesn't go through, they get their car back and you get your money back. And "if you do not immediately return the vehicle you shall be liable for all expenses...." and so on.

I am speaking of my experiences in California.
Correct.

My son's old girlfriend had this happen, and she went back and handed them the keys. She had no trade-in though.
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Re: Car financing denied after 2 weeks

Post by zlandar »

The only lenders offering 0% financing are the finance dept of the car manufacturers. Decisions on these loans are made in minutes. Not 2 weeks.

Spot delivery and yo-yo financing have been around for awhile:

https://www.edmunds.com/car-loan/dont-f ... ncing.html

As a buyer if you don't have good credit (720+) you are highly unlikely to qualify for 0% or other incentive financing from the car maker lender. If you don't know your credit score before applying for a home or auto loan then you are asking for trouble.
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Re: Car financing denied after 2 weeks

Post by fru-gal »

njdealguy wrote: Sat Dec 14, 2019 1:15 pm If it were me to teach them a lesson assuming have time I'd drive the car across the country coast to coast and back before returning it, should force them to discount it at least 5-10% further to next buyer (maybe being then considered a "demo" model) :D
I'm kind of liking this. I always wanted to drive across the country, sounds like it's an ideal time for the OP's son to do that. Check the paperwork first for any gotchas.

Yes, some dealers are crooks. My experience with them is limited, since I am only on my third car in sixty years of driving, and I only dealt with dealers for the recent purchase (and then bought from a relative.) I had salesmen produce blatant lies, like the mpg of a hybrid was only 2mpg greater than an ICE car, or the base price was $10,000 higher than I knew it was. Other stuff as well. One of my pet peeves is being assumed to be an idiot due to my age. I think it never occurred to these people that a little old white haired lady would do any research. Stunning, really.
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Re: Car financing denied after 2 weeks

Post by Billionaire »

SmallCityDave wrote: Sun Dec 15, 2019 8:45 am
0% financing and CC rewards is how so many on this forum have become financially independent ;)
In the grand scheme of wealth building, those are small parts of the equation. I'd say about .01 %. A) How often do you buy a car? B) Is 0% financing available for the vehicle you want?
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Re: Car financing denied after 2 weeks

Post by Billionaire »

zlandar wrote: Sun Dec 15, 2019 10:03 am The only lenders offering 0% financing are the finance dept of the car manufacturers. Decisions on these loans are made in minutes. Not 2 weeks.

Spot delivery and yo-yo financing have been around for awhile:

https://www.edmunds.com/car-loan/dont-f ... ncing.html

As a buyer if you don't have good credit (720+) you are highly unlikely to qualify for 0% or other incentive financing from the car maker lender. If you don't know your credit score before applying for a home or auto loan then you are asking for trouble.
Bingo. Plus, I was looking at some of the vehicles being offered at 0%. None that I would buy.
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Re: Car financing denied after 2 weeks

Post by imyeti2 »

MotoTrojan wrote: Sat Dec 14, 2019 10:57 am The phrase ‘local media’ and BBB would be in my response.
I agree here. Plus plaster this guy all over social media. Is this a new car or used car dealership?
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Re: Car financing denied after 2 weeks

Post by neilpilot »

SmallCityDave wrote: Sun Dec 15, 2019 8:45 am
Billionaire wrote: Sun Dec 15, 2019 8:31 am Folks, in today's business environment, if a dealership offers a 0% interest rate to me, I'm walking out of the place. That's a clear indication that some funny business is about to take place. Caveat emptor.

Regards,
Billionarie
0% financing and CC rewards is how so many on this forum have become financially independent ;)
Actually the road to financial independence includes getting the dealer to adjust that 0% financed price down to a cash price that doesn't require the dealer to rebate to the manufacturer's finance program.
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Re: Car financing denied after 2 weeks

Post by Cigarman »

This happened with us and it was called "spotting". Sign paperwork, give you a car, come back and say deal fell through. Usually after several weeks have passed in order for you to "fall in love" with the vehicle.

Finance guy told me that we had been driving the car at no charge for a month. My response was to send him a copy of financing I arranged in literally no time (several hours on line). We did not have a trade in so we told him he could either match the financing or come get the car. Amazing how the next day everything was settled just right.

As a side note, a friend of mine leased a car and the dealer put the wrong terms on the contact, in favor of my friend. Once they realized their error, they were quick to want to re-do the deal and had the gall to ask him to come in and correct it. There appears to be no shame in the dealer financing world. My friend agreed to redo the deal but insisted they come to him, which they did.

Hold firm with them.
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Re: Car financing denied after 2 weeks

Post by MaryO »

RickBoglehead wrote: Sun Dec 15, 2019 9:01 am
Freddy wrote: Sat Dec 14, 2019 9:55 pm The dealer has to contribute to manufacture's 0% financing. They are kicking in up to a couple of thousand dollars to keep the rate low. They now want to make even more money off you by not paying into the loan and by trying to get you into a loan with interest. Don’t fall for it. They are doing what they had planned before you walked out of the dealership. Do you know your FICO score? Shop for a loan at a Credit Union and get a commitment from them and then buy a vehicle somewhere else, if you are returning the car. If they don’t have your trade in make sure you ask for the retail replacement cost of the trade. You don’t want to get screwed twice. Also, make sure you know what your trade is worth on the retail market. Check For comps on one of the online used car sites. Good luck. I hate shady dealers. I thought these practices were long gone, but I guess I was wrong.
Absolutely not true.

For example, Ford Credit offers dealers financing, including zero percent. The dealer gets a kickback/bonus from Ford if the customer makes 3 payments. Savvy buyers take the normal, unsubsidized rate, then either refinance or pay off the loan the next week. Dealer gets no bonus, but that's life.

Dealers can offer financing from their manufacturer, or shop loans via local banks. They very often will INCREASE, not decrease the rate to make even more money off deal.
Could you clarify for me? If a customer is offered 0% financing, $0 down, what do you mean by "Savvy buyers take the normal, unsubsidized rate....?" Are you talking about a deal with a higher interest rate but a lower purchase price?
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Re: Car financing denied after 2 weeks

Post by KyleAAA »

Paddygirl wrote: Sun Dec 15, 2019 7:32 am I am shocked that the dealer has no responsibility here? This whole sham or scam should be illegal.
It's very unlikely the dealership has any control whatsoever over the financing falling through. They have no incentive to trigger this chain of events. Some dealerships occassionally try something like this, apparently, but the issue is with the financing, not the dealership. The dealership doesn't control the financing and there's no valid reason to make it illegal, because nobody acted in bad faith.
Last edited by KyleAAA on Sun Dec 15, 2019 12:46 pm, edited 1 time in total.
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Re: Car financing denied after 2 weeks

Post by RickBoglehead »

MaryO wrote: Sun Dec 15, 2019 12:37 pm
RickBoglehead wrote: Sun Dec 15, 2019 9:01 am
Freddy wrote: Sat Dec 14, 2019 9:55 pm The dealer has to contribute to manufacture's 0% financing. They are kicking in up to a couple of thousand dollars to keep the rate low. They now want to make even more money off you by not paying into the loan and by trying to get you into a loan with interest. Don’t fall for it. They are doing what they had planned before you walked out of the dealership. Do you know your FICO score? Shop for a loan at a Credit Union and get a commitment from them and then buy a vehicle somewhere else, if you are returning the car. If they don’t have your trade in make sure you ask for the retail replacement cost of the trade. You don’t want to get screwed twice. Also, make sure you know what your trade is worth on the retail market. Check For comps on one of the online used car sites. Good luck. I hate shady dealers. I thought these practices were long gone, but I guess I was wrong.
No.

Ford will offer 0% financing with rebates of $X. That rate is bought down by reducing the rebates.

They also offer say 5.99% financing with rebates of $X plus $1,000 or $1,500. Take that deal. Pay off or refinance days later with a credit union. Keep higher rebate. Done.

Absolutely not true.

For example, Ford Credit offers dealers financing, including zero percent. The dealer gets a kickback/bonus from Ford if the customer makes 3 payments. Savvy buyers take the normal, unsubsidized rate, then either refinance or pay off the loan the next week. Dealer gets no bonus, but that's life.

Dealers can offer financing from their manufacturer, or shop loans via local banks. They very often will INCREASE, not decrease the rate to make even more money off deal.
Could you clarify for me? If a customer is offered 0% financing, $0 down, what do you mean by "Savvy buyers take the normal, unsubsidized rate....?" Are you talking about a deal with a higher interest rate but a lower purchase price?
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Re: Car financing denied after 2 weeks

Post by Goal33 »

Billionaire wrote: Sun Dec 15, 2019 8:31 am Folks, in today's business environment, if a dealership offers a 0% interest rate to me, I'm walking out of the place. That's a clear indication that some funny business is about to take place. Caveat emptor.

Regards,
Billionarie
Sounds like slim chances you’ll buy a new car then
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