Just bought a 06 PT Cruiser and I'd like to throw some questions out about some things a finance officer at a dealership told me as we were discussing loans and percentages.
First, he quoted me 9.2% for 72 months. After I didn't accept that, attempted to get him down to the local average of 6.5% or so. He stated I couldn't get a loan for that % unless the loan amount was over
15,000. Is this possible?
Second, I asked him if I could have a day to compare rates with other companies, he flat out said "no". Is this standard practice? As a consumer, I should have the right to look around for a better finance rate - correct?
I know this doesn't necessarily contain a Chrysler-related question, but if I conclude that these statements were false, I'm going to write to someone and complain.
I suppose anything is possible, but this is not likely. Your rate is more likely to depend on your credit score than on the amount financed. With average credit 9.2 for 72 is not out of line. It's a tad high for good credit. Wells Fargo, Capital One, and many other banks will quote you auto rates online. So you're better off to have all the financing lined up BEFORE you go to the dealer.
Yes, take all the time you want. There are more than one dealers in the USA. Most would be glad to allow you to shop for financing. If yours won't, then go to another one.
No. It is possible that it makes a difference. It's also possible that
9.2% is what you can get at the bank.
It's certainly common for them to lie, and this is sort of a dumb angle for them to take, so I would not want to impugn all car dealers by saying it's "standard practice". I'd say it's nothing unusual. The dealer desperately needs your money. They will profit off your loan, and that's why they want to handle it. They sell loans to make additional money.
This is not the worst lie they have. The worst lie is to tell you "we'll give you this great interest rate and your payments are $XYZ", when in fact the payments are higher than they should be. Most people would never do the math and determine that the dealership tacked on an extra $50 or $100 a month. You might want to get somebody who understands finance to check their math.
As a
Of course. It has nothing to do with your rights. They'll take cash in exchange for a car. If you go to the bank and get money, then the dealer will accept money in exchange for a car. HOWEVER, you will be depriving them of the opportunity to profit from your loan. That could make a difference in a deal/price. That's perfectly okay, for them and you. It's your money, and it's their car. They need your money a lot worse than you need their car.
They sound like they're pretty good at high-pressure crook stuff, and you gave them the business they wanted. If your payments are honest it's no big deal. If they're dishonest then by all means get out of it.
Yes, you should! BUT! It is your best be to go to your bank and any other lenders and get PRE-APPROVED!
I recently purchased a 2002 Grand Caravan. I went to my bank, and got pre-approved before I even went shopping! This way I KNEW that I had financing, and what my bank could do for me. This pur me in the driver's seat - literally - when talking with the dealer. I was not forced to take a bad rate.
Keeping in mind that we are in Canada...
My bank offered me up to $20,000 for up to 5 years (60 months) at "Prime plus 3" - floating (currently running at about 9.5 %). I was not thrilled with this, but it was in line with other financial institutions.
As a laugh, I asked the dealer - JACKPOT!
The dealer gave me 8.18% FIXED for 5 years. Since I believe interest rates are going to go UP not down, then the dealers offer is a much better offer. Kinda blew me away too as I still think 7.5% for our credit history, but hey - we DID need a car after that 16 yr old hit and totalled our old van!
Usual terms and consitions, plus the ability to repay early without penality!
Basically, it is my opinion you should do ALL your homework before you go shopping. If the dealer put the gun to my head like that, I would have walked - plain and simple. What is he hiding???
The dealer that sold me my current van let us take the van for a weekend test drive! We had it inspected for both body & mechanical. The salesman looked at out inspection, and had some more things fixed on the van - no quesitons asked. Heck, just before we purchased it, the van developed a bad switch that drained the battery! The switch was replaced, and a NEW battery installed - all wothout asking.
It took this guy over 2 weeks to close the deal. He never ever forced us, and the customer service was truly AMAZING.
Any salesman that trys to back you into a corner,,,, well I have to ask if the Management will hire and keep such a salesman, what are the staff in the service department like???? Are you going to get the after sales service and support that you PAID for???
Is what the salesman did "illegal"?? No. You basically got caught in an eppisode of "Deal, or NO Deal". He was not prepared to keep the deal on the table unless you closed the deal at that moment. This is, IMHO, unethical. He forced you into closing the deal so he could make a commission. I think you were bullied. But you let it happen. As I said, had my salesman done this, I would have walked. My money says that had you returned with alternate financing, the vehicle would still have been there. And if he was not willing to extend the same offer, I would have told him to stick it.
You can write and complain, but you have lost all your power. The power is in your hands when you have the money. It is quite likely that your complaint will fall on deaf ears.
I hope you had that car checked out thoroughly before you purchased it.
Definitely you should compare. This "no" from him was the tip off to go elsewhere. I'd try your bank. I borrow from my brokerage account, which is a high rate, but since it it tax deductible it's lowest after tax.
Regarding rates from any course I suggest you get the detail of all payments for an accurate comparison of costs. Up front charges and how they calculate their rates (interest cost should be on the remaining balance) vary significantly. For example their 6% is usually more than 6%!
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