Car Dealer Gimmick

[Cuda340]

I saw on the chargerforum that a car dealer in Nebraska was selling SRTS for invoice.

The gimmick? One of a kind- "bait & switch? No...

The dealer does not accept cash!! You must finance with him at triple the going rate!

I wonder if this can be beat by accepting his terms and refinancing with your bank at the market rate or getting a 6% home equity loan?

[SRTOutlaw]

Or if you had the money to pay for the car. Then accept his rates. Pay it off a month later and burn his ass. He legally can not stop you from paying it off early.

[JonW]

Most states have laws in effect that say that the method of payment cannot change the price, i.e. you have to sell the car for that price regardless of how the buyer intends to pay for it. I suspect that is illegal.

[My Hemi]

Could it be the dealer is getting some sort of kickback on the loan, but doesn't really care how soon you pay it back? There is a dealer in Nebraska that I have bought through many times, and if remembering right, I bought one on a loan and this is what he told me about paying it off. I think there was a couple hundred dollar incentive for me, and probably (guessing) for him. I promptly payed off the loan one month later, so I came out ahead.

This could be the same dealer, and if it this one is near Omaha, he is one straight shooter (at least the particular salesman I deal with --- this is a HUGH dealership, one of the biggest, if not the biggest in the country).

[Cuda340]

Originally Posted by JonW

Most states have laws in effect that say that the method of payment cannot change the price, i.e. you have to sell the car for that price regardless of how the buyer intends to pay for it. I suspect that is illegal.

I think the way they get around it is not quoting a price until they find out how you are paying for it. If you say you are paying cash, you won't get an invoice price.

[08ChallengerDad]

Is it illegal? I doubt it, but it doesn't seem like an advantage to the buyer OR the dealer - it limits the potential customer base. If Credit Card companies are allowed to charge 42.66% interest, I can't imagine a State intervening on what would be considered a legally binding contract - willingly entered into by both parties of legal capacity.

They're banking on making their money on the "Dealer Reserve" I mentioned in my sticky post here. That amount depends on each dealer's agreement with the local banks. And as I said in the sticky, NEVER discuss financing options until a price has been agreed to.


My wife and I bought her an '06 Charger R/T last April. The dealer did the original financing at 11.99% interest through Chrysler Financial, with a $1,000.00 instant cash offer. We were pre-approved with our Credit Union at 8.14%. We let the dealer write the paper, give us the $1,000.00 credit, went to the Credit Union and had them pay off Chrysler Financial within two weeks of getting the car and signing the note, ended up saving the (roughly) $800.00 difference between the interest accrued in the two weeks and the $1,000.00 instant cash back, and now have our payments taken out of our paychecks. We never mail a coupon, it's all automatic.
It's all in "learning to play the game".

[Cuda340]

Originally Posted by My Hemi

Could it be the dealer is getting some sort of kickback on the loan, but doesn't really care how soon you pay it back? There is a dealer in Nebraska that I have bought through many times, and if remembering right, I bought one on a loan and this is what he told me about paying it off. I think there was a couple hundred dollar incentive for me, and probably (guessing) for him. I promptly payed off the loan one month later, so I came out ahead.

This could be the same dealer, and if it this one is near Omaha, he is one straight shooter (at least the particular salesman I deal with --- this is a HUGH dealership, one of the biggest, if not the biggest in the country).

Is this Performance Dodge in Lincoln, NE?

[My Hemi]

Originally Posted by Cuda340

Is this Performance Dodge in Lincoln, NE?

Woodhouse of Blair.