My husband, who has a 801 FICO per the dealership, had to haggle for an hour and a 1/2 just to get a 5% interest rate today.

[butterflywings]

It's like they wanted him to pay a higher rate. When they said 10% my husband said no, then over the next hour they offered him 7, then 6, then said 5% was the lowest rate they could get him, he accepted.  Our lender is Summit Federal Credit Union; to get the loan my husband had to join the Parma Hilton Historical Society.  lol

 

 

[MarvBear]

congrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrrats!!!!!!!!!!!!!!!!!!!!!

 

[A Credit Ed]

Just guessing here, but I wonder if dealers get a kickback from the finance company and larger kickbacks for higher APR loans.

 

If this is true, what is to keep a cash buyer from asking for a high APR in return for a lower sales price, then paying their loan off in full a day after the ink is dry on the paperwork?

[hdporter]

13 hours ago, A Credit Ed said:

Just guessing here, but I wonder if dealers get a kickback from the finance company and larger kickbacks for higher APR loans.

 

If this is true, what is to keep a cash buyer from asking for a high APR in return for a lower sales price, then paying their loan off in full a day after the ink is dry on the paperwork?

 

Because dealers didn't fall of the turnip truck yesterday ...

 

The dealer knows that, were they to manipulate the loan in the manner to secure a higher kickback, that there's no way the borrower/buyer is going to keep the loan intact.  Qualified for a lower rate, the buyer will do EXACTLY what you suggest ... refi the loan at a lower rate ASAP.

 

And when that loan is repaid in a manner of a few weeks subsequent to disbursement, the lender is going to claw back the premium paid to the dealer (against which the price was reduced).  Dealer is royally screwed.

 

 

[hegemony]

On 6/10/2023 at 5:17 PM, butterflywings said:

It's like they wanted him to pay a higher rate. When they said 10% my husband said no, then over the next hour they offered him 7, then 6, then said 5% was the lowest rate they could get him, he accepted.  Our lender is Summit Federal Credit Union; to get the loan my husband had to join the Parma Hilton Historical Society.  lol

 

 

5% is not bad these days. kudos for him to stick to his guns and not settle for the earlier offers.

[hdporter]

On 6/12/2023 at 9:48 AM, hegemony said:

5% is not bad these days. kudos for him to stick to his guns and not settle for the earlier offers.

 

Perhaps.  But I don't understand why anyone would venture into a dealer without having secured their best financing in advance.

[hegemony]

10 hours ago, hdporter said:

 

Perhaps.  But I don't understand why anyone would venture into a dealer without having secured their best financing in advance.

 

 

 

Edited June 22, 2023 by hegemony

[butterflywings]

On 6/21/2023 at 9:52 PM, hdporter said:

 

Perhaps.  But I don't understand why anyone would venture into a dealer without having secured their best financing in advance.

 

We thought the dealer would have access to the largest pool of lenders to choose from, plus we could get all the inquiries in one day, all @ the same time. It's the way we've always done it. We had no idea this dealership would act almost like an adversary, when trying to get us the lowest rate.

[hdporter]

3 hours ago, butterflywings said:

 

We thought the dealer would have access to the largest pool of lenders to choose from, plus we could get all the inquiries in one day, all @ the same time. It's the way we've always done it. We had no idea this dealership would act almost like an adversary, when trying to get us the lowest rate.

 

I appreciate the explanation!  And, when I and my wife ventured into our first new car financing in 2006, we were similarly under "misapprehensions".  But when we found out a dealer ran our credit with a couple of lenders on a preliminary basis just because we had taken a car for a test drive, my eyes were opened a tad.  Then, as a brand new member here, I dug a bit and discovered how unscrupulous some dealers are when lending lands on the table.

 

I learned that there's no better advocate in scoring a good loan rate than oneself.  And, unlike 20 years ago, an individual is well equipped to fully explore viable options:  the internet not only brings potential lenders to their fingertips, but also levels the entire playing field.  The days of accepting loan terms out of the uncertainty of whether it's a really good deal (but you don't want to risk losing the approval) are dead.

 

Lenders now make the entire process from application & approval, to putting a check in your hand that you can present to the dealer on the spot once you select a car, an incredibly empowering experience.  No one should accept a "pig in a poke" offer via a dealer, where you have no idea what kickback he might be getting, effectively costing you money.

 

So, yeah, I get where you're coming from entirely.  But the only financing I'll seek through a dealer is promotional manufacturer financing.  We purchased a car a little over 2 years ago, with mfr 1.9% APR for 5 years.  We really smiling now!

[StarkRaven$]

5 hours ago, hdporter said:

 

I appreciate the explanation!  And, when I and my wife ventured into our first new car financing in 2006, we were similarly under "misapprehensions".  But when we found out a dealer ran our credit with a couple of lenders on a preliminary basis just because we had taken a car for a test drive, my eyes were opened a tad.  Then, as a brand new member here, I dug a bit and discovered how unscrupulous some dealers are when lending lands on the table.

 

I learned that there's no better advocate in scoring a good loan rate than oneself.  And, unlike 20 years ago, an individual is well equipped to fully explore viable options:  the internet not only brings potential lenders to their fingertips, but also levels the entire playing field.  The days of accepting loan terms out of the uncertainty of whether it's a really good deal (but you don't want to risk losing the approval) are dead.

 

Lenders now make the entire process from application & approval, to putting a check in your hand that you can present to the dealer on the spot once you select a car, an incredibly empowering experience.  No one should accept a "pig in a poke" offer via a dealer, where you have no idea what kickback he might be getting, effectively costing you money.

 

So, yeah, I get where you're coming from entirely.  But the only financing I'll seek through a dealer is promotional manufacturer financing.  We purchased a car a little over 2 years ago, with mfr 1.9% APR for 5 years.  We really smiling now!

Seems that the days are gone one can take a vehicle for a test drive alone. When I took my car that I have now for a test drive back in 2016, the salesman rode alone with us. That was a first for me. Didn't really mind and actually, I understand. He doesn't know me from a hole in the wall.

 

I already had an approved loan through my cu too.

[hdporter]

8 minutes ago, StarkRaven$ said:

Seems that the days are gone one can take a vehicle for a test drive alone. When I took my car that I have now for a test drive back in 2016, the salesman rode alone with us. That was a first for me. Didn't really mind and actually, I understand. He doesn't know me from a hole in the wall.

 

Well, when shopping in 2006, dealer attitude almost swayed our deal.  We were eying a Lincoln Zephyr, which was on the lot as a end-of-model year special.  It was priced at $32k, which on our budget at the time, was a stretch.  But the features and comfort were a step up over the Camry that we were otherwise considering.

 

So we took it for a test drive ...  Salesman gets in the passenger seat and I let Bev take the wheel first.  He proceeded to direct her in a 1-mile rectangle on city streets.  We swap places and I'm directed to complete the same circuit.

 

That vied with a ride along earlier in the day in a Lexus, where the sales rep directed us to the highway and invited us to "open it up".  In the case of the Camry, they basically tossed us the keys and asked us to bring it back in 2 or 3 hours after we had a good feel for it..

 

The Camry, a high end model that was packed with features, was impressive all they way around.  But the simple fact that they were ubiquitous on the road (with good reason), wound up putting us off.  The Zephyr, with 140k mi, is still my main driver, and I love it.  (And, as I've previously noted, we purchased a final model year 2020 MKZ, retagged from Zephyr, and it's basically cooling it's heels in the garage, waiting for the changeover when we make the Zephyr Bev's car for her 6 mi ferry commute, where it'll sit in the sun.  It's a very sweet loaded ride.  But I love the Zephyr )

[shifter]

10 hours ago, StarkRaven$ said:

Seems that the days are gone one can take a vehicle for a test drive alone.

Naw, it's dealer by dealer. Most places around here scan your DL and let you go alone. A few insist on riding along. It really depends on the clientele they typically deal with.