16 replies to this topic

[DrCindy]

Does anyone know if there are any rules set forth by auto dealerships which prohibit them from accepting credit cards in buying a car? Hubby and I are planning on buying a used car and then paying it off with our home equity loan. We spoke to one auto dealership yesterday who said it was illegal for them to accept CC's. But then after talking with his "manager," he said he could take $2K on the CC.

I have a Visa through Bof A and when I called them, the rep said she has known of several people buying cars with their CC's. However, when I called my American Express rep, she said just the opposite; that she has not seen any purchases of cars.


Any suggestions would be helpful. I just can't trust these car salesmen; I know they want us to finance through them so they will make some money. Thanks!

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[tq480]

It probally has to do with them having to pay fees if you use the card

[breeze]

Yeah, they won't want to pay the transaction fees.

[MarvBear]

If there are, they would be internal rules as far a purchasing a vehicle outright.

[ERIC0728]

I was offered by Scott Volkswagen in Rhode Island to pay the entire purchase by CC if I was OK paying the additional 3% or so transaction fees MC charges them.

[mk_378]

I would hope that the dealer has a better deal with the bank than 3% on a five figure charge. In some cases the finance manager doesn't care about the fee because it won't come out of his commission or affect his profit numbers. If it's not a rock-bottom deal that they'd rather not do anyway, and you're going to walk if you can't charge it, they may eventually decide to eat the fee.

You could also ask your bank about balance transfer offers. You could use that to take a check to the dealer, or finance the car then BT the whole thing as soon as you find out who is the finance company.

Edited by mk_378, 04 March 2012 - 07:32 PM.

[road2freedom]

I bought an $11k motorcycle on CC once... wasn't my brightest idea ever but was pretty fun. We split the fee.

[Omnicef]

I purchased a car with a CC back in 1997. (I was paying cash, but earned some points by using the CC and PIF the following week.) It was about 10k.

Edited by Omnicef, 05 March 2012 - 02:13 PM.

[Mortgagase]

I've bought several cars and motorcycles using a credit card. Never a problem.

[Herloss]

Back in the 90's I also purchased several automobiles on cards. As always, it was to receive reward points or Discover Cash - etc. However, in addition to the fee that the seller may incur, I ran into dealerships reticent to do so due to the warranty issues (which may vary by state). As I recall, some cards - in that time, Gold or Platinum cards - came with some purchase warranties that dealers believed (and were smart to consider) may hold them liable for automobiles purchased using a credit card. Generally, my signing extensive "AS-IS" waivers were sufficient to complete the sale. Not always.

Most likely as far as your card issuer can see, it is a purchase at a merchant, no different than say you just paid X-thousand to replace your engine, etc. You have the credit available, the dealer takes cards, they negotiate the transaction cost into the deal (if they wish) and there is no warranty issue; you should be golden to purchase about anything you can finance.

*Interesting follow-up.... An Uncle of mine just paid for their '12 Buick Enclave balance with a credit card at the Buick Dealer. No problems. Not even a transaction surcharge. $35,000.00 he owed after rebate/trade etc. YMMV

HL

[mk_378]

Nowadays, the card warranty programs specifically exempt cars. But there is still the FCBA right to charge back because there is a problem with the quality of the merchandise.

Edited by mk_378, 06 March 2012 - 11:36 AM.

[jst300z]

BT the cash to your bank, write a check for cash.

Easy peasy.

[hegemony]

a salesguy at the BMW dealer here told me some guy blew a gasket when the manager would not let him charge a new X6 on his Amex Black card.

I was able to charge a 10K down on my last purchase but the F&I guy was not happy about it.

[spotlessbureau]

I had a customer purchase a car ($20k transaction) on a credit card before. Here are the reasons they say no. First is the transaction fee. I would simply add it to the price and you would have to pay. Second credit cards offer many different levels of buyer protection (Amex etc.) in which you can call them and simply say you arent happy with the product and unwind it on their end. That's risky for dealers. Especially in this market. I don't think debit cards add a transaction fee. You may want to consider using that instead.

[groze]

I had a customer purchase a car ($20k transaction) on a credit card before. Here are the reasons they say no. First is the transaction fee. I would simply add it to the price and you would have to pay. Second credit cards offer many different levels of buyer protection (Amex etc.) in which you can call them and simply say you arent happy with the product and unwind it on their end. That's risky for dealers. Especially in this market. I don't think debit cards add a transaction fee. You may want to consider using that instead.

Debit Card do have transactions fee, some fees are lower do to the Durbin Amendment. Some Banks & Cus are excluded from that rule if they have less then 10 billion in assets. They did that to keep the little banks & Cus from going out of business.

[hegemony]

I had a customer purchase a car ($20k transaction) on a credit card before. Here are the reasons they say no. First is the transaction fee. I would simply add it to the price and you would have to pay. Second credit cards offer many different levels of buyer protection (Amex etc.) in which you can call them and simply say you arent happy with the product and unwind it on their end. That's risky for dealers. Especially in this market. I don't think debit cards add a transaction fee. You may want to consider using that instead.

Debit Card do have transactions fee, some fees are lower do to the Durbin Amendment. Some Banks & Cus are excluded from that rule if they have less then 10 billion in assets. They did that to keep the little banks & Cus from going out of business.

not to mention most institutions restrict how much can be purchased daily on a sucky debit card.