Got a new one for everyone...

A certain car dealership thinks that it's able to impose a maximum charge on a credit card for purchases of vehicles. They have a sign posted that says "The maximum credit card transaction allowed for puchasing a vechicle is $1000" or something to that extent.

As most of us know, it is against the policies and the merchant agreement the dealership signed with Visa/MC/AmEx to impose a minimum or maximum, impose a fee, or require ID as a term of the sale.

Now here is where it gets interesting: I learned about this through my friend who was out with his parents while they were shopping for a replacement to a car that managed to get totaled in -- of all places -- a parking lot when an elderly woman ran into it. Luckilly nothing/noone was damaged/hurt other than their car, her car, and another car in the lot.

Well, they had found a car. However, they did not want to finance or anything (since they had money saved, I guess and are also getting a check from some insurance company since their vehicle was totaled.) So, when his dad said he wanted to put the whole thing on his credit card (like $12,000), the dealership refused. They said he could only put $1000 on the card and would have to write a check for the rest. Not having a checkbook on him, and knowing that maximum's aren't allowed, my friend's dad argued with them. The dealership didn't back down -- SO THEY WALKED OUT -- meaning that's $12,000 less that dealership made that day.

They are still going to buy a car -- I Just doubt they'll be buying from this dealership since the management is too incompetent to know that they can't impose a maximum charge on a credit card since they agreed to it in their merchant agreement.

Get them to write something stating the book value of the car and the price they are offering it for. Of course it always works out in the consumers favor as they want you to think you are getting a deal. Then file a complaint with VISA for the differnce that was lost on the transaction.

NO MINIMUM
NO MAXIMUM
NO FEE TO USE THE CARD
NO ID ON A SIGNED CREDIT CARD

"IF" THEY PAID 3% FOR A FEE THAT IS ONLY $360

THAT FEE IS A COST OF DOING BUSINESS JUST LIKE...

WATER
SEWER
GAS
ELECTRIC
PHONE
ETC

THEY DO OIL CHANGES WITH CREDIT CARDS
THEY DO RENTALS WITH CREDIT CARDS
THEY SELL PARTS WITH CREDIT CARDS
THEY DO COLLISION REPAIR WITH CREDIT CARDS
THEY INSTALL TIRES WITH CREDIT CARDS
THEY DO TUNE UPS WITH CREDIT CARDS

BUT THEY CAN'T SELL A CAR???

THEY "INFER" THEY WILL LOSE LIKE $3,600 NOT JUST $360

THAT $360 IS A TAX DEDUCTABLE COST OF DOING BUSINESS!!!

Did they report the dealership to VISA? A picture of that sign would help alot, too. In any reporting, that is.

Not sure if they reported. But that dealership lost over $10k that they were seconds away from getting -- far more than any fine Visa would give them, I think.

My guess is that the car dealership doesn't care about the transaction fee -- but wants to force customers to finance through them by not allowing credit cards to be used. That way they make money off the car loan interest and such.

They lost over $10K in the sale, though not all of that was profit obviously, but I understand your point.

I also understand them wanting to steer people into financing since that is the big money maker, but that still doesn't excuse them from doing the right thing and honoring their commitments.

I wonder if it's a dealership that also does repair work, and if they have the same limit for repairs over $1000. Something tells me they would let that slide.

Personally, I think it goes deeper than this. With credit cards, you have an additional layer of protection. You can always do a charge back if there is a "problem." Now here's the rub. A consumer can make up any problem they see fit. The dealer would be left holding the proverbial bag if the consumer's grievance is made up. This really exposes the dealership to far too much liability. And I can sort of understand why a dealership will draw a distinction on how you purchase the vehicle. I know some dealerships in my area have this policy. Their response with any one wanting to use a credit card is to go ahead and do so if you do a cash advance or use a BT check. That would seem to negate the assumption that dealers just want to steer consumers towards the F&I department.

well...this might encourage people to borrow more which means more money (potentially) for the dealer on the backend...

THAT REASON IS A "WEAK" REASON TO REFUSE TO FOLLOW CREDIT CARD POLICY!!!

charge backs are not automatic. consumers are not free to make up reasons. not all charge back requests are approved.

Well that's your opinion. When you're dealing with cars that depreciate once it rolls off the lot or if it was titled to an owner, then you're talking about big money for each car. Not to mention the headaches a dealer would have to go through in dealing with fighting a charge back. We're not talking about a even a few hundred dollars in lost value...we're talking about thousands. I don't know any business that can just absorb that kind of loss. Once sold, vehicles can't just be simply remarked for sale to another owner like any other merchandise. Weak as you may call it, it's a reality. To me, it's a totally justifiable reason.

YOU HAVE A RIGHT TO YOUR OPINION...

Agreed. I'm not devious enough to think of false reasons to do a charge back. So I can't think of any that would be viewed as valid to initiate a charge back. I'm using this example for from real life experiences with my friend who owns a repair shop. He says sometimes has to deal with charge backs even though he repaired the car properly but the customer thought he charged too much or the customer abused the car again and claimed he didn't do the repair properly.

Just tossing out something that to me is still a valid concern.

Interesting points, and I would agree that they're valid concerns. The only way around them, I would suggest, would be to have the selling part and all other parts of the business as two separate and distinct business entities. They could still occupy the same property, and it wouldn't have to be obvious to the general public. The selling business does not take credit cards at all, and the other (parts, service, etc.) does.

I signed like 20 or 30 papers and one was a "FRAUD" paper that gave them the right to collect their expenses involved in a FRAUDULENT transaction (if it was fraud)

SO "IF" I DISPUTED THE TRANSACTION THEY WOULD STILL COLLECT

THEY ALSO HAVE ALL THE OTHER SIGNED PAPERS THAT WOULD BE PRESENTED TO AMEX "IF" I WAS STUPID ENOUGH TO DISPUTE THE SALE!!!

Poor excuse...

Chargebacks aren't that easy to go through with. "Just any reason" doesn't cut it.

I've had three people do chargebacks against me in the past five years. I provided the credit card companies (one was amex, the other two were visa/mc) the information they requested and the chargebacks were disallowed.

Next, you'll be telling us you agree with the "right" of a dealership to pull a credit report on a credit card sale or a bankable check sale??

John

Just because I don't agree with you, I would appreciate that you don't make assumptions about what else I would support that is counter to your opinion. Thank you. I personally don't have a business where I have to deal with credit cards. My friend does. All I have to do is have him recount the headaches he had to go through to fight false chargeback claims on services he provided.

most dealers do this ... if you dont like it then they let you walk.

dealerships deal with "returns" all the time and somehow they manage to stay in business. it is called a "rollback" and many times it means the dealer makes MORE money not less on the vehicle.

ETA: I mean "unwind" not rollback. sorry.

Could you elaborate more on this? Thanks.

when financing falls through; the car is returned (sometimes with hundreds of miles on it) and the dealer sells the car as "new." I made a mistake with the term...this is called an unwind...

Ok. I get it. I guess the same would apply for having no insurance too. I guess this gets to be pretty complex. I was only speculating on a plausible reason why credit cards are not accepted which would be logically the concern about charge backs. Which I might have to file against a furniture company who still hasn't delivered my sofa after I put a deposit down now over 16 weeks ago.

THEY PULLED THAT ON ME WITH PIF AMEX DELTA

And on me with a cashiers check, no warning.

I DIDN'T FIND OUT TILL WEEKS LATER!!!

HAD I KNOWN I WOULD HAVE WALKED OUT FOR THAT REASON ALONE!!!

Sorry, your argument is "justifiable" ONLY if they don't accept credit cards for ANY of the purchase price of the car. not if they have a max. It Certainly is most likely for financing profits. How it works is they don't mind someone charging a $1000 "down payment" on a credit card..and then "financing" the rest. That's their ideal transaction.

If they don't want to take the "risk" ( a check can be forged or no good as well) of accepting credit cards, then they should not accept credit cards. Period.

See this thread and particularly MarvBear's explanation on usage/term agreements with credit card companies.

http://creditboards.com/forums/index.php?showtopic=160567

There are lots of things people don't like about various businesses. Dealers set policies how they see fit. I only gave my guess at why they might have that policy. I don't set them. And like what some people have said, don't like, don't buy from them. Simple.

JUST BECAUSE THEY CAN SET THEIR OWN RULES FOR THE BUSINESS IT DOESN'T MAKE IT RIGHT WHEN THEY ARE CONTRARY TO THE CREDIT CARD POLICY THAT THEY AGREED TO WHEN THEY SIGNED UP!!!

If the dealership is doing everything right, they won't get a chargeback. But let's say you get a used car with 20,000 miles -- then find out the odometer had been rolled back illegally from 40,000 miles. Well, the credit card company would let you return the car and do a chargeback. You wouldn't have to go through the hassle of suing the dealership to get your money.

Also, the dealership can't set whatever policy it wants for credit cards -- because they signed a legally binding agreement with the credit card companies that says they can't set maximums/minimums.

In this case, the dealership only limits to $1,000 for vehicle purchases. So I suppose if you had repairs over $1,000 they'd take the cards.

There are other dealerships out there that will take a credit card for whatever ammount you want (for example where MarvBear works). Those dealerships will likely get the money that dealerships applying limits lose.

Not necessarily. There are plenty of dishonest people in the world that live to work the syetm and try to get something for nothing.

It does still happen, but most states have very severe panalties for dealers caught doing this. Severe enough that most of the crooks won't even try this one anymore.

If I had proof of odometer fraud on my car, I wouldn't mess with civil court. The AG will make it all better, except in a few states.

Dealers do have the power to hold up the title on a car until they're sure the money is good, so they can "unwind" a new car sale and sell it as new again. But realistically they couldn't do that for the full 60 days or more that a chargeback is possible.

I wonder if they'd take one of those Credit Card checks that places like BofA send out.

YES BUT YOU GET NO REWARDS

THEY WILL PROBABLY DO A HARD INQUIRY TOO!!!

No....... I had about 2K in repairs on my car a few years ago. Went to put it on my MC, and they wouldn't accept it for that amount. To get my car back I had to post date a check... it really screwed up my cash flow for a few weeks. Too bad I didn't know the policy then. I was soooo mad.

You should have demanded that they take the credit card -- they are required to.

I'd of persoanlly written a check then done a stop payment on it once I left the dealership. Then I'd offer to pay the dealership with a credit card -- otherwise nothing.

I WOULDN'T WRITE THE CHECK AND STOP PAYMENT BECAUSE I DON'T CARRY MY CHECKBOOK

(more issues than you want to have)

THEY WOULD TAKE THE CREDIT CARD or THEY CAN EXPLAIN TO MY CREDIT CARD COMPANY WHY THEY ARE REFUSING MY CREDIT CARD

Wouldn't purposely and maliciously stopping payment on a check be illegal?

No. They refused to accept your legitimate payment via credit card that they signed a legally binding agreement to take.

If they don't want to take your payment, then that's their problem.

Me thinks that writing a check, with no intention of allowing the payment to be processed, would be illegal, and that the credit card issue would be 100% irrelevant.

I'd love to be there when you explained your reasoning to a judge.

WRITE A CHECK THEN STOP PAYMENT

(more issues than you want to have)

Let's look at this another way.

You offered payment via credit card, which the merchant claims to take (and can take.) They refuse it. You owe $2,000 -- but only have $1000 in your checking. So you write a check and it bounces.

I am in no way advocating not paying for the repairs. However, when you give a credit card to a merchant that displays the logos and claims to accept the cards, they better take it.

I agree 100% that they're supposed to take the credit card if they say they do. And a scenario like this is exactly where a customer should be pull out their cell phone and call VISA to get it straightened out. But, once you write the check, regardless of why you're writing the check, you're supposed to have money to cover it and not doing anything malicious to hinder the payment. Anything that went on before you whipped out the checkbook simply doesn't matter.

Now, you could write the check, then go get a cash advance and deposit the money to cover it. I agree that wouldn't make any sense, and that it shouldn't come down to that, but a written check is as legally binding on you as anything else.

So the customer should just continue to argue with the idiots at the dealership until they take the card, I guess?

That's what you've been advocating for other scenarios in other threads... argue and make a scene until they do it according to the merchant agreement.

But, really, that's neither here nor there, as I was trying to focus primarily on the stopping payment on a check. As far as checks are concerned, the customer shouldn't be surprised if they get bit in the butt when they put a stop payment on a check for questionable reasons.

THE CREDIT CARD COMPANIES DON'T ALLOW MAXIMUM CHARGES...

WHY LET THE DEALER CHANGE THE RULES THAT VIOLATE THE CREDIT CARD POLICY???

"IF" THEY TELL ME IN ADVANCE THAT THER ARE GOING TO VIOLATE CREDIT CARD POLICY...YES I CAN GO SOME OTHER DEALER!!!

BUT "IF" THEY TELL ME TOO LATE I'M NOT THE ONE THAT IS GOING TO BACK DOWN!!!

My thoughts too... if they told the customer up front, then they can go elsewhere and report the violators to Visa/MC/AmEx.

But -- if they don't tell the customer up front, then the customer has every right to pay with a credit card and offer only a credit card for payment.

We went to a dealer that has the same sign. They also offer "guaranteed financing" so my guess is they see a couple of bad debts.

I went in saying "I'm paying $2500 down using my CC. If that's a problem, I'll go down the street to another dealer." It wasn't a problem.

I wonder if it would still have not been a problem if you said "I'm paying the entire price with my credit card."?