Purchasing a car with credit cards for cash back rewards?
Purchasing a car with credit cards for cash back rewards?
When "paying cash" for a car, has anyone here paid (in part or in full) with credit cards, in order to rack up cash-back bonuses or airline miles? Not sure a car dealership would accept credit card(s) for a large purchase, but I'm wondering if anyone here has tried.
-
- Posts: 165
- Joined: Fri Jan 03, 2014 2:08 pm
Re: Purchasing a car with credit cards for cash back rewards
on 2 separate occasions I was able to charge 5-8k on credit cards toward a vehicle purchase. each dealership seemed to have their own cap for whatever reason. i would have loved to charge the whole thing!
Re: Purchasing a car with credit cards for cash back rewards
Many dealers won't accept credit cards, which is a bummer. Otherwise it's a great strategy!
"An investment in knowledge pays the best interest." - Benjamin Franklin
-
- Posts: 15368
- Joined: Fri Dec 31, 2010 8:53 am
Re: Purchasing a car with credit cards for cash back rewards
This. The last time I purchased a car, the dealership limited me to $3k on the AMEX.absolutFinance wrote:on 2 separate occasions I was able to charge 5-8k on credit cards toward a vehicle purchase. each dealership seemed to have their own cap for whatever reason. i would have loved to charge the whole thing!
Re: Purchasing a car with credit cards for cash back rewards
You used to be able yo pay more, the dealers have cut way back on how much they will accept. You will need to ask the particular dealer their limit. I put 3k on one about 20 yrs ago.
Mike
Mike
Re: Purchasing a car with credit cards for cash back rewards
I have not but I recall my parents telling me that my godmother and her husband where on a cross country vacation when their car broke down in the southwestern US (from Pennsylvania). They decided the repairs exceeded what they wanted to put into the car, went into a dealership, negotiated a deal and paid for the whole thing with credit cards. This was probably in the early 1980's. I do not think rewards were involved.
-
- Posts: 5761
- Joined: Mon Sep 22, 2014 4:47 pm
Re: Purchasing a car with credit cards for cash back rewards
I'm assuming that, like all merchants, the dealer would pay a percentage to the credit card company.
I would therefore expect a dealer to be unwilling to negotiate to his lowest price if a credit card was used.
I would therefore expect a dealer to be unwilling to negotiate to his lowest price if a credit card was used.
- SquawkIdent
- Posts: 927
- Joined: Tue Dec 23, 2008 6:14 pm
- Location: Planet Earth
Re: Purchasing a car with credit cards for cash back rewards
The last new car I bought (last year) the maximum they let me put on my credit card was $3500. I find that that amount is about the norm. I did try (on many occasions) to buy an entire new car using a credit card and every time the dealer acted like I was trying to rob them. They explained about the fees, etc. they would have to pay. We soon agreed to that $3500 amount. It never hurts to ask though...
If you are buying a new car, enjoy it!!
If you are buying a new car, enjoy it!!
Re: Purchasing a car with credit cards for cash back rewards
I have a GM Master Card that builds up $ (5% of spending) for GM purchases.. I used my GM card, (5K Max - added back to the GM card) Plus the $ I had built up over the past two years. I have done that twice so far.
Re: Purchasing a car with credit cards for cash back rewards
Tried it last time even going so far as to raise the limit on our AMEX high enough to cover the purchase before getting the vehicle. Dealership wouldn't do it. They made up some crap about fraud, but I'm sure the real reason is that it would cost them too much in fees.
I’d trade it all for a little more |
-C Montgomery Burns
Re: Purchasing a car with credit cards for cash back rewards
For my last car, I negotiated to pay 16.5K on my credit card. The strategy was to wait for the dealership to call me the next day after I looked at a car. They wanted me to come back to complete the deal. I told then I would like to buy the car today, but I left my checkbook at home. I would come in if they allowed me to put the full down payment on my card. Otherwise, I'm not sure when I would be able to come in again. Given those choices, they relented, and I earned a ton of bonus points.
- JDCarpenter
- Posts: 1800
- Joined: Tue Sep 09, 2014 2:42 pm
Re: Purchasing a car with credit cards for cash back rewards
I did it in 2012 for a cheap new car--a Honda Fit. All negotiation was online, went to dealer, gave credit card and got car. Didn't seem to present any issue.
Our personal blog (no ads) of why we saved/invested: https://www.lisajtravels.com/
Re: Purchasing a car with credit cards for cash back rewards
Keep in mind the dealer has to pay a merchant fee on all their credit card transactions. So many will limit the amount you can charge against a purchase, to limit their expense on what is a fairly small markup. Another way to look at it is if they accept a credit card, there was probably another few percent you could have negotiated down the purchase price for cash.
Not an issue at parts/service though, where they will gladly take your credit card and the resulting fee since they are making a 300% markup.
Not an issue at parts/service though, where they will gladly take your credit card and the resulting fee since they are making a 300% markup.
-
- Posts: 637
- Joined: Wed Dec 19, 2012 6:38 am
Re: Purchasing a car with credit cards for cash back rewards
My most recent car purchase (2011), dealer let me put $5,000 on my CC.
-
- Posts: 3908
- Joined: Fri Jan 17, 2014 9:19 am
Re: Purchasing a car with credit cards for cash back rewards
Last time, the dealer accepted my credit card for the $500 deposit, but refused to accept it for the remaining balance, saying the credit card surcharge was too high.
Re: Purchasing a car with credit cards for cash back rewards
Most dealers in my area have a limit of either $2,500 or $5,000 on credit card purchases. I charged $5,000 once to get a 1.25% cashback reward, and the dealer's finance manager was clearly annoyed since it was too late for him to recoup the cost by raising his other fees or the price of the car.
Re: Purchasing a car with credit cards for cash back rewards
As suggested in an earlier post, if using a credit card is part of the discussion of the price of the car they are just going to dig in at a higher price to cover the merchant fee so there's no point. If it's a discussion after the price is determined, they're probably going to strictly limit it, but you might as well try to pay as much as they'll accept with the CC. $5k or more sounds terrific but car before current one they limited me to $2500 IIRC, and current car bought recently only $1000.
-
- Posts: 417
- Joined: Mon Apr 19, 2010 11:39 am
Re: Purchasing a car with credit cards for cash back rewards
I was able to put $5k on my credit card when I bought my Honda in 2012. That is the most $ that the dealer would allow.
- black jack
- Posts: 806
- Joined: Fri Oct 10, 2008 10:13 pm
Re: Purchasing a car with credit cards for cash back rewards
Several years ago I tried to do this.
I called the credit card company in advance to confirm that their policy - that a merchant who advertises as accepting their card cannot refuse to allow a customer to use the card for a purchase - applied to automobile dealerships.
At the dealership, when we'd agreed on a price and I pulled out my card, the dealer said "sorry, you can't charge it."
I pulled out my cell phone and called the credit card company's number, planning to have a customer service agent repeat to the dealer what they'd told me a couple of days earlier. But I got a customer service agent who did not confirm what the other agent had told me earlier. I was pissed.
The dealer agreed to let me charge $3k on the card; I had to go to a bank for the rest (I was making the purchase out of state, and hadn't bothered to bring my checkbook, counting on what the first agent had told me).
I called the credit card company in advance to confirm that their policy - that a merchant who advertises as accepting their card cannot refuse to allow a customer to use the card for a purchase - applied to automobile dealerships.
At the dealership, when we'd agreed on a price and I pulled out my card, the dealer said "sorry, you can't charge it."
I pulled out my cell phone and called the credit card company's number, planning to have a customer service agent repeat to the dealer what they'd told me a couple of days earlier. But I got a customer service agent who did not confirm what the other agent had told me earlier. I was pissed.
The dealer agreed to let me charge $3k on the card; I had to go to a bank for the rest (I was making the purchase out of state, and hadn't bothered to bring my checkbook, counting on what the first agent had told me).
We cannot absolutely prove [that they are wrong who say] that we have seen our best days. But so said all who came before us, and with just as much apparent reason. |
-T. B. Macaulay (1800-1859)
Re: Purchasing a car with credit cards for cash back rewards
We tried it with last two car purchases, each dealership capped at $3k.
Re: Purchasing a car with credit cards for cash back rewards
About two years ago I was told that the max was 5K per card used in the transaction
-
- Posts: 3559
- Joined: Sat Oct 26, 2013 6:53 pm
- Location: Bay Area
Re: Purchasing a car with credit cards for cash back rewards
I bought a car last month from a Toyota dealership. I negotiated online and finalized the deal over the phone prior to picking up the car. During the call, I asked what the maximum they would allow me to charge. They responded that it was $3k. I asked them to make it $5k. The salesperson said he'd have to check and get back to me. He called back in a few minutes and agreed to the $5k charge.
Ask them what they'll allow and counter it with a higher amount. There is a chance they'll agree.
Ask them what they'll allow and counter it with a higher amount. There is a chance they'll agree.
Re: Purchasing a car with credit cards for cash back rewards
Good question Scouter. Useful thread.
Re: Purchasing a car with credit cards for cash back rewards
The most the dealer would let me was $ 3500.00. I don`t know they limit you.
Re: Purchasing a car with credit cards for cash back rewards
$3500 charged is around $70 in credit card fees for the dealer, most the time on new vehicles they are only making a few hundred in profit to begin with. Dealerships usually make more profit on used and certified pre-owned vehicles so they may be more willing to increase credit card limits on those vehicles. With credit cards it's easy for a card holder to initiate a dispute and cause a charge back as well which is costly and time consuming for the dealer.
-
- Posts: 454
- Joined: Sun Mar 15, 2009 11:58 am
Re: Purchasing a car with credit cards for cash back rewards
When we recently bought a car the dealer limit was $3000. However we also were able to put another $3000 on the card for the warranty (which we later canceled and got a check back in the mail), and finally we were able to put a another $500 deposit down on the card to put the car on hold/reserve (this portion was fully refundable had we not purchased). So in total about $6500 on a 2% cash back card.
When they first said the limit was only $3000 we were a little disappointed, however you may be able to do similar to what we did to put even more on the credit card.
When they first said the limit was only $3000 we were a little disappointed, however you may be able to do similar to what we did to put even more on the credit card.
Re: Purchasing a car with credit cards for cash back rewards
I did for my last car--a used car with price of approximately $10k. I called the card issuer in advance and they said it was fine, and the dealership was fine with it as well. This was in 2006, so things might have changed following 2008-09.
Re: Purchasing a car with credit cards for cash back rewards
I was about to put 5k of the purchase amount on my credit card. Paid the rest by check.
Re: Purchasing a car with credit cards for cash back rewards
Two years ago I ordered a new car with a $5K order deposit on Fido's 2% AMEX. No problem.
-
- Posts: 635
- Joined: Sun Jul 27, 2014 3:32 pm
Re: Purchasing a car with credit cards for cash back rewards
Merchant fees are 3-4%, 2.5 at a minimum. So if you are paying with a card, they are getting 97% in cash. Seems like they would be better at negotiating for cash, but other factors might require they not discount sticker price further. Seems odd they wouldn't just reduce price 2% instead.
Re: Purchasing a car with credit cards for cash back rewards
Got $3.5K on the last couple of new cars. About 10 years ago I bought a $10K used car with a credit card. I always wait until we have a final "out the door" price before I ask, otherwise they'll just add the fee to the price they'll negotiate.
Re: Purchasing a car with credit cards for cash back rewards
Here's an AMEX site that shows the dealers willing to accept the card for at least part of the purchase.
https://amexnetwork.truecar.com/promo1. ... arpurchase
Several years ago we went to a dealer that was advertised by AMEX as accepting AMEX up to the full purchase price. We did get a good price on the car through AMEX, but the dealer would not allow more than a $3k charge. I fought it for awhile with AMEX. They acknowledged the ad, but would not enforce it.
https://amexnetwork.truecar.com/promo1. ... arpurchase
Several years ago we went to a dealer that was advertised by AMEX as accepting AMEX up to the full purchase price. We did get a good price on the car through AMEX, but the dealer would not allow more than a $3k charge. I fought it for awhile with AMEX. They acknowledged the ad, but would not enforce it.
Re: Purchasing a car with credit cards for cash back rewards
I did this last year for the full purchase price of a loaded Prius. Had previously negotiated the price via a Costco deal, which beat the price of Trucar and other sites. I didn't expect them to allow it, but they smiled and actually volunteered it. For what it's worth it was an AutoNation dealership in SoCal. With the points I earned I got 2 business class tickets to Europe on British Air.
Re: Purchasing a car with credit cards for cash back rewards
last month I was able to put the full purchase price of a mercedes on my amex. it must depend on the dealer and how badly they want (need) to make the sale.
-
- Posts: 1877
- Joined: Tue Apr 08, 2014 3:23 am
Re: Purchasing a car with credit cards for cash back rewards
In ancient times (1999), I charged the total price of our van on two credit cards--got cash back on one and 0% interest for 18 months on the other (paid off in full after 17th month). Worked great for us! Haven't bought a new car since then, so am not sure what policies are any more but we may find out soon as H wants a new car. We have several credit cards he can try and will see what happens.
Re: Purchasing a car with credit cards for cash back rewards
My experience is 5K max for the deposit. Obviously, it's costing the dealership to process the credit card payment and they would limit it as much as they can.
'It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so!' Mark Twain
Re: Purchasing a car with credit cards for cash back rewards
I bought a new Audi last year and had a $20k down payment. The car lot let me charge the whole down payment to my Hilton Amex so I could get the points. Paid off the $20k when I got my credit card statement.