What Method of paying cash for car: EFT vs check?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
GrowthSeeker
Posts: 884
Joined: Tue May 15, 2018 10:14 pm

What Method of paying cash for car: EFT vs check?

Post by GrowthSeeker »

Hi Bogleheads. I'm planning to buy a car, $40k to $50k range, for cash in the near future. What is the best method for doing so from your experience?:
1. write a personal check (Chase bank)
2. direct electronic transfer from my account (Chase, Ally, or Vanguard) to dealership's account.
3. Cashier's check

I'd rather not fill out a loan application, so a method that avoids that would be preferred.
I'm also less interested in getting Cashier's check because the nearest branch of my bank is 30 miles away.
I don't have check-writing at either Ally or VG. (Maybe I should.)

Thanks.
Last edited by GrowthSeeker on Sun Sep 06, 2020 10:43 am, edited 1 time in total.
Just because you're paranoid doesn't mean they're NOT out to get you.
mega317
Posts: 4581
Joined: Tue Apr 19, 2016 10:55 am

Re: What Method of paying cash for car: ECF vs check?

Post by mega317 »

Last time I bought a car cash #3 was the only option they would take. You might call them and ask what you’re your actual options are.
Another nice thing about 3 if you’re negotiating is to walk in to the dealer with a cashiers check made out in whatever amount you’re willing to pay. If it’s reasonable it could be hard for them to push a check back across the table. Maybe not a great idea if they do that and you need to drive another 60 miles.
You could also consider opening an account at a closer bank or CU so the distance isn’ta factor in the future.
Last edited by mega317 on Sun Sep 06, 2020 1:22 pm, edited 1 time in total.
https://www.bogleheads.org/forum/viewtopic.php?t=6212
livesoft
Posts: 73338
Joined: Thu Mar 01, 2007 8:00 pm

Re: What Method of paying cash for car: ECF vs check?

Post by livesoft »

I used a cash-back credit card up to the limit that the car dealer would except, then personal check. No dealer has ever required a cashier's check from me. They also didn't require the check on the day I drove out of the lot, but would accept it a few days later. They told me, "No worries, we know where you live and if you don't pay, then it is grand larceny."

But instead of asking us, ask the people selling you the car.
Wiki This signature message sponsored by sscritic: Learn to fish.
flyingcows
Posts: 144
Joined: Sat Apr 20, 2019 8:13 am

Re: What Method of paying cash for car: ECF vs check?

Post by flyingcows »

livesoft wrote: Sun Sep 06, 2020 8:50 am I used a cash-back credit card up to the limit that the car dealer would except, then personal check. No dealer has ever required a cashier's check from me. They also didn't require the check on the day I drove out of the lot, but would accept it a few days later. They told me, "No worries, we know where you live and if you don't pay, then it is grand larceny."

But instead of asking us, ask the people selling you the car.
+1, this is what I have done in the past when purchasing from a dealership. The dealership did want to run my credit before they would accept the check, I let them but perhaps that is not required. Anyway, they didn't deposit the check for about 2-3 weeks
Dave55
Posts: 793
Joined: Tue Sep 03, 2013 2:51 pm

Re: What Method of paying cash for car: ECF vs check?

Post by Dave55 »

I bought 2 new cars in 2018, and used a personal check with no problem. In the past 30 years I never had an issue using a personal check to buy a new car.


Dave
User avatar
mmmodem
Posts: 2254
Joined: Thu May 20, 2010 1:22 pm

Re: What Method of paying cash for car: ECF vs check?

Post by mmmodem »

Last three times I bought a vehicle was:

1. Cashier's check
2. Personal check
3. Credit Card

By far, my favorite was with a credit card for reward points but they wouldn't take CC the last two times. I wonder if it was because I had another form of payment. If I had insisted I only had a CC for the down payment, like I did when I was much younger, maybe they would've allowed it.

Don't worry about the cashier's check. That's what they told me when I said I had to order it from my non-local credit union and it would come in the mail. I said I would come back with the check in a few days and pick up the car. The dealership insisted I take the car on the spot with no payment whatsoever. They said if I run off with the vehicle, that's what insurance is for. I can mail in the check later. Which is what I did.

Edit: Yes, there was a high probability I would not return to the dealership with the cashier's check. So they made the right decision insisting I take the vehicle home same day.
Last edited by mmmodem on Sun Sep 06, 2020 9:08 am, edited 1 time in total.
bltn
Posts: 881
Joined: Mon Feb 20, 2017 9:32 pm

Re: What Method of paying cash for car: ECF vs check?

Post by bltn »

I ve never had a problem with using personal checks for car purchases. With my next car, I m going to try to use cash back credit cards. I ll then pay off the credit card amounts the that month.
runner3081
Posts: 3563
Joined: Mon Aug 22, 2016 3:22 pm

Re: What Method of paying cash for car: ECF vs check?

Post by runner3081 »

Last car, we paid for it entirely on a 2% cash back credit card. Only caveat is that the dealership required a credit check for me to do so. I figured a single inquiry was worth it.

Previously, I have always used a combo of credit card to whatever the dealer's max is and then personal check.
User avatar
Stinky
Posts: 5525
Joined: Mon Jun 12, 2017 11:38 am
Location: Sweet Home Alabama

Re: What Method of paying cash for car: ECF vs check?

Post by Stinky »

livesoft wrote: Sun Sep 06, 2020 8:50 am I used a cash-back credit card up to the limit that the car dealer would except, then personal check. No dealer has ever required a cashier's check from me. They also didn't require the check on the day I drove out of the lot, but would accept it a few days later. They told me, "No worries, we know where you live and if you don't pay, then it is grand larceny."

But instead of asking us, ask the people selling you the car.
My experience in buying a car in late 2019 was exactly the same - cash back credit card up to the dealership limit, then a personal check for the excess.

It would be a real PITA to need to get a certified check, because you'll need to know the exact amount of the check when you're at the bank. And, in my experience, there might be a small shift in some of the price numbers as you get close to signing on the dotted line.
It's a GREAT day to be alive - Travis Tritt
jebmke
Posts: 11396
Joined: Thu Apr 05, 2007 2:44 pm
Location: Delmarva Peninsula

Re: What Method of paying cash for car: ECF vs check?

Post by jebmke »

Our last one we put a sizeable amount on our American Express and they financed the rest at zero percent. They did all the loan app info automatically. We stepped out for lunch, came back, signed a couple of papers and drove away.
When you discover that you are riding a dead horse, the best strategy is to dismount.
MikeG62
Posts: 3088
Joined: Tue Nov 15, 2016 3:20 pm
Location: New Jersey

Re: What Method of paying cash for car: ECF vs check?

Post by MikeG62 »

Done this a number of times from a number of different dealers. Dealers always accepted a personal check from me.

Brother has bought several cars from the same dealer (over 15+ years) and always been told he needed to bring a bank check.

I'd start by telling them you plan to pay by personal check and see how they react. I would not ask if I can. I would say this is how you plan to pay. Whether it's a deal breaker for you is entirely up to you.
Real Knowledge Comes Only From Experience
allones
Posts: 29
Joined: Fri Apr 13, 2018 11:27 am

Re: What Method of paying cash for car: ECF vs check?

Post by allones »

In the last few years, I've bought two cars from dealerships with cash, both times paying with personal checks. The most recent time I offered to have the money wired but the finance person said they prefer to have something physical once I walk out the door.
Topic Author
GrowthSeeker
Posts: 884
Joined: Tue May 15, 2018 10:14 pm

Re: What Method of paying cash for car: EFT vs check?

Post by GrowthSeeker »

Thanks for all the quick replies.

Yes, I knew that asking the car dealer which way(s) they would accept is in some ways the best answer, but it could be one of several dealers, and I'd prefer, for bargaining purposes, to not let them know I'm planning a cash purchase until the price is settled.
I've paid for cars with cashiers' checks (many years ago), and an electronic transfer (once).
Part of the bank issue is that I'm geographically mobile, and of the 3 states I spend time in, I'm currently in the one where I spend the least time but I don't have a bank branch closer than about a 40 minute drive.

I just paid my CC balance online, so I'll have the full credit limit as an option; I'll double check what the reward % is for each of my credit cards.
Just because you're paranoid doesn't mean they're NOT out to get you.
Ron
Posts: 6690
Joined: Fri Feb 23, 2007 7:46 pm
Location: NY-NJ-PA Metropolitan Statistical Area

Re: What Method of paying cash for car: EFT vs check?

Post by Ron »

GrowthSeeker wrote: Sun Sep 06, 2020 10:43 amI just paid my CC balance online, so I'll have the full credit limit as an option; I'll double check what the reward % is for each of my credit cards.
You may have a high limit on a card, but how much can be charged to it is defined by the dealer, not you.

The last car I purchased (2015), the dealer would only accept $5k on a card; the remainder was covered by a personal check.

- Ron
Topic Author
GrowthSeeker
Posts: 884
Joined: Tue May 15, 2018 10:14 pm

Re: What Method of paying cash for car: EFT vs check?

Post by GrowthSeeker »

Ron wrote: Sun Sep 06, 2020 11:01 am
GrowthSeeker wrote: Sun Sep 06, 2020 10:43 amI just paid my CC balance online, so I'll have the full credit limit as an option; I'll double check what the reward % is for each of my credit cards.
You may have a high limit on a card, but how much can be charged to it is defined by the dealer, not you.

The last car I purchased (2015), the dealer would only accept $5k on a card; the remainder was covered by a personal check.

- Ron
good point, thanks.
Just because you're paranoid doesn't mean they're NOT out to get you.
Doctor Rhythm
Posts: 425
Joined: Mon Jan 22, 2018 3:55 am

Re: What Method of paying cash for car: EFT vs check?

Post by Doctor Rhythm »

I think it’s pretty idiosyncratic what the dealership will accept. When we bought a car with cash last year, they required a credit check (hard pull) to accept a regular check. In a purchase 12 years before that, another dealership was fine with me just logging into my checking account and flashing them the screen to show the balance. If I had the time, I’d use a cashier’s check.
tomd37
Posts: 3388
Joined: Thu Mar 01, 2007 10:39 pm
Location: Middle Tennessee

Re: What Method of paying cash for car: EFT vs check?

Post by tomd37 »

Payment for the last five automobile purchases have been with a personal check from my credit union in the DC/VA area. There was another purchase that required a bank cashier check because the dealer was delivering it to me from out of state and had no idea who I was. We dealt online for that purchase. :moneybag
Tom D.
Gadget
Posts: 385
Joined: Fri Mar 17, 2017 1:38 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Gadget »

I purchased a vehicle in the same price range with a personal check from a Fidelity CMA account at a dealer last year.

It would have annoyed me to have to get a cashier's check, and I would have let them know that I might be looking at other dealers on the way to get a cashier's check. Although I am jealous that other posters paid with cash back credit card. I didn't know that was an option. I assumed they'd charge a fee for that. And none of my best cash back cards have anywhere close to a credit limit to cover that by themselves, so it would have had to be with 2-4 cards split up.
Soon2BXProgrammer
Posts: 917
Joined: Mon Nov 24, 2014 11:30 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Soon2BXProgrammer »

GrowthSeeker wrote: Sun Sep 06, 2020 8:22 am Hi Bogleheads. I'm planning to buy a car, $40k to $50k range, for cash in the near future. What is the best method for doing so from your experience?:
1. write a personal check (Chase bank)
2. direct electronic transfer from my account (Chase, Ally, or Vanguard) to dealership's account.
3. Cashier's check

I'd rather not fill out a loan application, so a method that avoids that would be preferred.
I'm also less interested in getting Cashier's check because the nearest branch of my bank is 30 miles away.
I don't have check-writing at either Ally or VG. (Maybe I should.)

Thanks.
If you want to get a bunch of raised eyebrows, a briefcase full of cash. (non sequential numbers of course)
tony_roach
Posts: 114
Joined: Sun Nov 19, 2017 2:05 pm

Re: What Method of paying cash for car: EFT vs check?

Post by tony_roach »

I made a cash purchase at the end of last year and used a personal check (the dealer was Carsense).
crefwatch
Posts: 655
Joined: Sun Apr 15, 2007 1:07 pm
Location: New Jersey, USA

Re: What Method of paying cash for car: EFT vs check?

Post by crefwatch »

I've bought many new cars, and I've always made a small deposit, and been required to bring a cashier's check on the pickup day. By the time I escape the Finance Office (for my cash purchase ... ....), the amount is known very precisely. I think it could be different if you are planning to buy from inventory and drive out the same day. I don't see that they would reject a cashier's check for close to the right amount and a personal check for $1,000 or so to meet the exact amount. It seems unlikely to me that the dealership would give you the banking information to make an ACH transaction with them.

Since companies accepting credit cards either eat the charge they have to pay, or pass it on to you (under state and local disclosure regulations), I think this reward-credit card stuff is fast becoming a thing of the past. When I buy takeout pizza, there's often a sign that says "4% Charge for Credit Cards."
inbox788
Posts: 7586
Joined: Thu Mar 15, 2012 5:24 pm

Re: What Method of paying cash for car: EFT vs check?

Post by inbox788 »

I was going to say Venmo, but looks like you'll exceed limits. Some companies have started to accept Bitcoin.

https://www.policygenius.com/blog/what- ... 1-million/

https://www.campbellfordniles.com/buy-a ... les-mi.htm

Other than a suitcase full of cash, there isn't a low cost, fast and convenient method to make such a large payment that's readily accepted and lets you drive off immediately without at least some credit/background checks.

OP, if you've got time, write them a check and wait or do a credit check. If you're in a rush, then you've got to put forth some effort. I don't think a check from VG or Ally will be all that different than Chase.

The loan application is a stupid form to do a credit check. All they really care for is your social security number and signature that you agree it can be used. The rest is pretty much irrelevant. You don't have to fill it out entirely if you don't care about a loan or that it's rejected. Leave things blank or zero as needed. Sometimes, when customer service representatives insist on getting your name (usually because they can't get past a computer screen), my first name is Current and last name is Resident. One day, I might find junk mail addressed to "Current Resident or Current Resident". Anyway, the ending to that customer service call is sometimes, "Thank you Mr. Resident, how may I help you?" "What time do you close today (being a holiday)?"
Nowizard
Posts: 3014
Joined: Tue Oct 23, 2007 5:33 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Nowizard »

We have always paid by personal check except when dealers will accept partial payment by CC from which we obtain benefits and pay off the next cycle. Our most recent purchases allowed $3,000 and $10,000 maximums, so dealers vary.

Tim
Topic Author
GrowthSeeker
Posts: 884
Joined: Tue May 15, 2018 10:14 pm

Re: What Method of paying cash for car: EFT vs check?

Post by GrowthSeeker »

Well, it turned out to be a small cash deposit and then a personal check.
This dealer only accepted these forms; they did not accept credit cards, cashiers' checks or ACH/EFT transfers. I didn't ask about bitcoin or suitcases full of cash.

I guess it varies a lot by car dealer.
Just because you're paranoid doesn't mean they're NOT out to get you.
Bama12
Posts: 276
Joined: Fri Aug 30, 2019 11:48 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Bama12 »

They take what I offer them or I'll go somewhere else.

I have walked out the door more then once over the price each time they came running out after me.
CurlyDave
Posts: 1970
Joined: Thu Jul 28, 2016 11:37 am

Re: What Method of paying cash for car: EFT vs check?

Post by CurlyDave »

I always enjoy taking a great big wad of Benjamins in with me.

Never been refused.
Bobby206
Posts: 478
Joined: Fri Oct 05, 2018 4:01 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Bobby206 »

Max out amount they'll let you put on credit card ($5k is the most I have seen) and then write a personal check for the rest. This is a very standard situation and I have never had a problem. No credit app needed though they often tell you it is - just say no or fill it out very quickly. It doesn't have to be perfect or complete... or readable for that matter!
User avatar
Watty
Posts: 20660
Joined: Wed Oct 10, 2007 3:55 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Watty »

The last time I bought a car they also had a series of obscure questions from a credit bureau to ask me to verify my identity since they they are also concerned about identity theft, which is good.

The problem was that the questions were so obscure that I failed a couple of the questions. I have had problems with that in the past with Experian(which I hate) because I have not used credit a lot so their questions were real obscure. One was something like did I once live on 103rd street, 107th, or 207th. I did not recognize any of them so I said none of the above. Later on I realised that they were asking about an apartment I had lived in for less than a year almost 30 years before!

They still let me drive off with the car but when I came back for the final paperwork and some extra keys that I got in the deal I needed to bring in my passport for additional ID. There were a couple of other things I could have brought in for ID but I forget what they were.

Anyway if you have a passport you might want to bring that in for additional ID when you buy the car.
Jack FFR1846
Posts: 12644
Joined: Tue Dec 31, 2013 7:05 am
Location: 26 miles, 385 yards west of Copley Square

Re: What Method of paying cash for car: EFT vs check?

Post by Jack FFR1846 »

Watty wrote: Sun Sep 13, 2020 5:14 pm The last time I bought a car they also had a series of obscure questions from a credit bureau to ask me to verify my identity since they they are also concerned about identity theft, which is good.

The problem was that the questions were so obscure that I failed a couple of the questions. I have had problems with that in the past with Experian(which I hate) because I have not used credit a lot so their questions were real obscure. One was something like did I once live on 103rd street, 107th, or 207th. I did not recognize any of them so I said none of the above. Later on I realised that they were asking about an apartment I had lived in for less than a year almost 30 years before!

They still let me drive off with the car but when I came back for the final paperwork and some extra keys that I got in the deal I needed to bring in my passport for additional ID. There were a couple of other things I could have brought in for ID but I forget what they were.

Anyway if you have a passport you might want to bring that in for additional ID when you buy the car.

How those identity companies stay in business is beyond me. I'm a Junior with a pretty unusual , long last name. I get the questions about what addresses I've been tied to and see my dad's rental houses all the time. I know that they want me to pick my dad's related address, and if I do, they verify me. If I don't (which would be correct), they don't. How someone named Smith or Jones could ever be verified by these clowns is beyond me too.
Bogle: Smart Beta is stupid
mhalley
Posts: 8417
Joined: Tue Nov 20, 2007 6:02 am

Re: What Method of paying cash for car: EFT vs check?

Post by mhalley »

Most dealers will have a max on how much they will allow you to put on a cc. Remember it costs them money in processing fees to accept the cc. I think the last time I used a cc they would accept 3k and paid the rest by check.
Chuck107
Posts: 507
Joined: Tue Sep 04, 2012 11:47 pm

Re: What Method of paying cash for car: EFT vs check?

Post by Chuck107 »

.....
Last edited by Chuck107 on Mon Oct 05, 2020 8:38 am, edited 1 time in total.
Alas, I find moderation of this forum too restrictive for my tastes, farewell.
emoore
Posts: 647
Joined: Mon Mar 04, 2013 8:16 pm

Re: What Method of paying cash for car: EFT vs check?

Post by emoore »

mhalley wrote: Sun Sep 13, 2020 5:52 pm Most dealers will have a max on how much they will allow you to put on a cc. Remember it costs them money in processing fees to accept the cc. I think the last time I used a cc they would accept 3k and paid the rest by check.
Same here. 3K on a CC and check for the rest. That was 5 years ago. Can't wait until we can just pay online like any other transaction. I really hate the dealership experience.
Post Reply