Car dealers HATE when customers know THIS

[louperez]

Choose the finance option, in a month, pay it off.

[gregberry]

I've done the finance thing then immediately paid off the car to get that discount. Just be sure there's no prepayment penalty.

[midship]

That was done to me and they were outsmarted. Took the loan with all the discounts then I paid off the vehicle the first payment. The only thing you need to make sure of is that there isn’t a prepayment penalty, which for mine there wasn’t.

[junito]

Ask for the monthly payments, multiply by the length of the loan and you will find out that the real price is $80K for the $44K car. 😂

[nbdrrpz]

Here in the UK it's illegal to do this, finance companies are being taken to court as we speak !

[chipchaser]

if you can afford to pay cash, finance it then pay it off in a month. Check for any pre-payment penalties.

[jav]

But couldn’t you just pay off the loan in a month to lock in the discount? Unless there is a prepayment penalty

[gbnmb]

Pro tip, take the financing discount and pay it off on the first payment.

[dejan]

Was going to get a Lexus TX350 awd premium and the dealer wanted $63k which was msrp, but with fees and bs they wanted $74k total. And for my trade a 2021 RX they gave me $10k less than what they will sell it for. So I just bought my RX. Its crazy the ripoff these days.

[redbovine]

John Deere and New holland farm equipment do this. There is a cash price that is negotiable but the finance price is different is generally no negotiable.

[j.dragon]

I just want to buy a car for cash without a hassle which leaves me with private owners only.

[ronaldroberts]

If you have the cash, take the financing. Make sure there is no early payoff penalty. Make sure you have the account number and accounts receivable address for the lender. Go home and write a check for the balance due.

[markj]

Hell I bought a used car and put it on my CC. The finance guy was like you cant do that. I was like oh yes I can!

[pharmis]

50k for a 3 year old Lexus with over 30k mikes!?!? Insane

[papiparsons]

These deals usually involve a minimum payoff period, typically 6 months. So sometimes it’s better to take their discount, pay the interest for the minimum time and then either pay it off or refi.
But watch for prepayment penalties, those are rare, but I’ve heard they’re still out there

[geobrad]

Yes, both dealerships I worked for did the "BUMP" interest, one credit union in our area will not allow it, I always tell people get your own loan approval before you shop, know what you can afford before.

[geraldyusko]

Less and less banks allow a markup on the rate provided by the bank. This is due to pressure from the CFPB. Most banks are now giving dealerships a flat rate based on Total Amount Financed.

So the idea that dealerships make boat loads is only half true. Also, boat loads is relative. I was a F+I manager for 4 years. $50, 000 financed with a fixed rate was about $1000 paid out to dealer (2016). If I held rate with another bank that allowed it, it could go up to $1, 500-1750 with a full 2% hold. Bank quotes, 3% I sell it at 5%.

So holding rate on $50K is not earning that much more money. On your example, a $6, 000 savings for financing the car just wouldn't have been made in the finance office.

[donaldmartin]

That is why I still drive my 1999 Dodge Ram 1500…. It was paid for 20 years ago ..

[notmycupotea]

check to ensure no pre payment penalty and refi 15 days later at local credit union.

[vzzjcph]

they don’t make $6, 000 on interest rate. At most you get 4% which is unheard of now a days but let’s say 2% kick back for finance Reserve that’s $759 That is not a Boat Load of money. It is however easier to sell an extended warranty when financed