When I speak of "Products", I mean the ones being sold in the dealership finance office. Typically on a "Menu" (see my other videos). For example, the Vehicle Service Contract a/k/a "extended warranty", GAP, maintenance plans, dent/ding, paint/interior protection, tire/wheel plans and so on. I have videos on each of these on my channel. Also, you can jump to the 8:18 Mark of this video: th-cam.com/video/xicg4_VimTY/w-d-xo.html And be sure to check out ALL my videos here: www.youtube.com/@AutoFinanceSense/videos
The previous owner must have had a really long loan as my Sister bought me outta my trust a 22 Camry & they neglected to tell us that I need a ATT hotspot even though my phone has it on there, Toyota must have a contract with ATT since nothing worked as far as safety features and the salesman just told me keep my phone plugged in and I'll see the maps? Nope after pressing it different times it said unavailable no subscription when in fact after calling ATT for a trial the previous owner had 8 years bundled with his loan, since I'm handicap & 25$ for a hotspot plus my cellular bill with consumer cellular & My Government plan for internet there's no way I can swing it and my Sister wrote a check outta my trust! I've technically had it a little over 2 week's shouldn't they have to pay the hotspot? I brought it back and paid the rustproofing against my Sisters wishes from the $ for the totaled title on the Mercury 3,300 I believe? I wasn't going to watch this video since my Sister already paid with a check basically cash but I'm glad I did! Any advice on getting them to update the maps and navigation system & take care of the hotspot would be appreciated since nothing is working since Toyota connect navigation system entune no longer exists but they do have updated maps which I believe they uninstalled while it was there 4 days getting re detailed mud in the side pockets and the rustproofing, gosh I hope we didn't get a Florida flood car? Mud in the side pockets of a Camry door is pretty odd
I made my deal at Toyota and then said I was putting 20k down and financing the other 15k. Finance told my salesman (who I liked) I had no credit at all. Some crap about it wouldn’t even show up but I could borrow from them for 18%. I called my credit union and was approved in five minutes for 5%. When I picked up the vehicle the finance manager never offered his hand and ran through the paperwork as fast as he could without even offering me to buy extras. I was happy, he was not.
@@sallyboy66 Boy if you only knew my net worth you would feel real dumb. Can probably afford waaaay more than you but not dumb enough to blow money on stupid shit.
Had a dealership try to say our credit was in the 600's some years ago and threw around a crazy interest rate. We had apps for every credit agency and pulled a report on the spot showing we had well into the 800's. They came back with some bs that they entered the wrong social security number and came back with a report with the correct rating. That was the last time I financed a vehicle. I go in now saying I'm going to trade something or I'm going to finance then, hit em with a check at the end.
Do your homework. Walk in the door and make an offer. No matter what they say, walk out. They will either chase you down or watch you walk away. There are 5000 dealerships.
@@Breeze-gd8wjBelieve it or not dealers don't make all their profits on the sale of a car. Finance , Parts, and Service are often the bigger profit centers. I would not worry about trying to be fair when buying a car. A dealer is not in business to loose money. When you negotiate a price there will come a time when the dealer stops working downward on price and refuses to budge. For most cars I'd say 7-10% off MSRP is a good savings for you and the dealer is still making plenty of money. Some cars are even discounted more aggressively if the dealer needs to move them. It's a moving target and no two deals are the same. Worry about you, not the dealer.
I just helped my daughter buy her first car last year. We had prearranged financing through our credit union at a rate that was less than half what the finance manager had quoted us. They refused to sell us the car after having the deal fully negotiated. We called another dealership that had the exact same car a few miles from the first dealership and told them what was happening and they told us to come on and they’d accept our financing. That turned out to be one of the most comfortable and easy car purchases I’ve ever been involved in.
sounds like they were just angry! GOOD it better to go somewhere else! if they are like that. its ok for them to rip off the consumer but when you try to do it to them they get bent all out of shape
@@blakespower No they didn't wanted to rip off the dealer because it's not possible lol , they just wanted to buy a car without being ripped too much.
Back in the recession a few years ago, my wife and I purchased a car. The interest rate wasn’t too high through capital one finance since my credit rating was so good. It was only seven point something and then I refinance it through the local credit union where I deal with interest rate is 2.9% you can’t beat that. I almost have a car paid for now. it certainly pays to belong to a credit union. They are much easier to deal with in my opinion than a namebrand bank.
Great video! In 2020 I needed a car now, and found one. The dealer played the keep them here all day so they will sign anything. I paid the cashier my deposit and when I finally got to the finance butthead, he turned out to be a shyster. I kept asking the APR and he kept avoiding it. When I bought an extended warranty but none of his other crap, the APR rate changed. He actually said, since I am buying less he can't give me the better APR. I was livid! After almost 6 hours in the dealership I was wishing I walked out. However, the next day I called my wife's credit union and they gave me an APR less than half of the dealer. They paid off the loan that day, which was the next business day from when I bought it. I also left a bad review to the manufacturer. The finance guy actually called me at work and started yelling at me! I hate being manipulated. I hope he lost all of his commissions!
If you're in the US, the practice of charging you a higher interest rate because you're buying less of their products at the finance table is called "tied selling" and is very illegal.
Weak finance managers do this. REAL finance managers can actually build value in their products with out playing these games....and yes, some of their products do have value.
When I bought my truck I get it through the employee purchase plan for ford motor. Ford sets the price which in my case is 2 percent under dealer cost. The dealer is compensated by ford motor for a predetermined amount. As far a extended warranty goes I also pay wholesale price plus 100-200$ that goes to finance guy. The finance guy actually got out a book and showed me the dealerships cost price on the warranty only then did I agree to buy it . The cost was only $1100.00 on a $95000.00 truck for a 7 year 200,000 mile warranty .
We recently had planned to buy a car at a dealership, but if I paid cash, the car would be $5K more than if I financed it. We did not want to be making payments, but they told us that they get a kickback from the finance company, so they can sell the financed car cheaper, but the contract would say that we must not pay it off before the 6 months, or we’d lose the $5K discount. They really pushed the idea of getting the financing and just paying the loan off in 6 months with no fees. To me, that was a great deal for them and an unnecessary minor hassle for us. As a result of their inability to make the deal attractive to a cash paying buyer, we walked away and found another car at a different dealership, that we paid cash for with no games.
@@Ryan-rn8gk They said we had to make payments for 6 months before we could pay it off, or we'd owe them the extra $5K. I was not willing to reward them with buying a car from them under that silly game. Their rate was not great either.
@@Leslie83249 Their rate was not great, but I refused to be roped into financing. They lost a sale from us, as we ad cash in hand, but spent it on a different car at a different dealership.
Yes. well said always ask for outdoor price first once u see them numbers than you can bring up a trade in never b4 and double check that paperwk very carefully because then bs add on will be on and if you don't catch them guess what that's coming out of your pocket and if that sales person or Mgr isn't willing to work with you, you go to the next dealership it's that's easy!
Exactly! I hate it when the salespeople ask me how much I am looking to spend per month. No, I want to know how much the vehicle is going to cost me after everything in total. They can make the monthly payment be whatever I want it to be, but I might be paying for the vehicle over a decade or more. You also have to watch those low APR deals like 0%. The finance managers always try to hook you with giving extra money towards the vehicle if you take a higher APR deal. It never works out unless you plan on paying off the car quickly (like paying it off the following month to a year max).
@@Babyshark2469 - or just drive the car until the trade is effectively worthless. My 2012 Mazda3 with 200k miles was a $900-$1500 trade. I didn't even bring it to the dealership other than for my first drive of the prospective vehicle. Once I decided and got a number, we came back with the bank draft in my wife's car. I drove my car around with a for-sale sign in the window and sold it in a week to a family with a new teen driver. | got 3x-4x what I'd get in trade allowance and a family got a good starter car for their kid.
I’m not going to a dealership to be friends. 😂. I couldn’t care less about the finance managers feelings or his bottom line. Either we do business on my terms or I’m going down the road to the next guy. Great tips! Empower the buyers to be educated!!
Quite a few of them wouldn't lose any sleep over marking up full commissions on their own families. They'll try to say it's a business. That's true however you give a discount to your loved ones
Yup, boss up. They lie so much. They sell the financial instrument, purchase margin stock for the credit provided to you or on your behalf, get FDIC or other insurance and still want people to pay, which is like the third time they're paid, lol. Gain financial literacy or be owned by the CFOs, Finance Managers, brokers and dealers etc.
If any finance manager doesn’t accept a full cash offer they are doing their dealership a huge disservice. It’s called cash flow which they could be investing in immediately and cash in the door now should always be a priority to any business.
Awesome vid. Used all your tips at the Porsche dealership. After buying the vehicle & moving through the finance room, nobody came by to congratulate me or shake my hand when I took delivery of the car. That's how you know I got a GREAT deal!
I used to work for a bank.. If you really want to make the F&I guy sad, FIRST negotiate your best deal... THEN tell him "oh by the way, I'm paying cash." Lots of times they'll work you a great deal on the price, with the back end finance profits in mind.. Also (forgive me if its been said) but always (if you can) buy on the last day of the month. The dealers are desperate to unload units on the 31st because on the first, they get hit with a flooring bill for each sled still on the lot.
@@highwayhash007 Car dealers are very sarcastic, bitter, fussy people; and they often refer to unsold cars no one wants, as "sleds" (pejorative not literal) and if a particular dealership has lots of unsold inventory (like say Ram Trucks which has like a 787 day supply) they refer to that dealership as "a sled lot" like trying to sell sleds in the summer. Good salesmen avoid sled lots, and try their hardest to land a job at a Toyota (which has 60 day supply) or some other more popular make, because they're easier to sell. Anyway, "a sled" in dealer slang, is just a car that no one really wants.
@@milfordcivic6755It is true that there can be a big advantage to buying at the end of the dealers month because the dealer has to refinance all of the inventory on his lot every month. He is working on borrowed money too. One problem though is knowing when the dealers month end is. They can all be different depending on their agreement with their financial lender. Some will be the 30th of every month while others might be the last business day of the month. Or some other date? If you don't know and the dealer has already refinanced the inventory yesterday you will have no advantage today.
@@milfordcivic6755I was thinking this as well. What dealership are they at that still has new Toyotas on the lot (not counting the monstrosity that is the bz4x)
I bought an extended warranty on my last vehicle. It was around $2,700. I changed my mind about a week after signing the contract, called the finance manager and canceled. My loan was through Wells Fargo. I went onto the WF site about 10 days later, accessed my account, and it showed a credit for the amount of the rescinded EW. My loan monthly payments were a little over $300/mn. The net result is that i didn't have to make a payment of my loan for nearly a year.
I Just bought a car with cash couple months ago. The finance manager didn't say a thing just counted the cash we signed paperwork in and out within half an hour Loved It!
When it comes to large sums of money, apartment managers, car dealers, realtors, mortgage companies, banks, and the government are all much happier with checks or debit/credit cards of one variety or another. It means there is a paper trail as to where those dollars came from and orders of magnitude less likely to be drug/illegal money. Also, if a cop pulls you over and finds a large amount of cash on you, he can simply confiscate it. Many people have been nailed by this. It's called 'Civil Asset Forfeiture' and they don't have to charge you with anything at all to do it. Look it up.
This should be shown to every high school student, with the final explanation, "If you want a car, use self-discipline save your money, and buy with YOUR cash." People who scrape money for years to make a big buy will make damn sure they're getting the best possible deal they can find. You respect the dollar amount much more when its money you already labored for.
I cant wait until the dealer model is gone. Pay cash and just drop it in my driveway, leave the title on the seat and I will register it. Take that $1000 doc fee and shove it.
I negotiated a deal with a Salesman at the dealership. Then I went to my credit union and secured financing without the salesman knowing. When I returned and the salesman heard what I did he was physically ANGRY. I simply smiled and said my Credit Union gave me a better deal. It was very satisfying actually.😂
@@yiehnewtamiru7324people who sell useful products or services usually don't need the pushy sales tactics and other bullshit that finance managers at dealerships make their money from. There's literally no reason for that job to exist.
I literally was sitting here thinking that very same thing watching this video.. What the world.. why is buying a car so frustrating hard to get the vehicle you want at the best price.. sure a dealership has to have some profit to stay in business but all these back door “money makers” only to take advantage of people is insane to me. It’s hard enough in today economy to survive with rising prices and inflation affecting the market interest rates to have these unethical and deceitful money making tactics being used on people. Very frustrated as I am in the market to buy a new car soon.. uggh 🫤
Bought a mint used jetta in 2020. Dealership pulled every single scam but I wouldn't budge. Wanted me to pay $400 for nitrogen filled tires. Lol. Said I'd walk and got that for free. Tried to sell me oil change package. No. I'll take it to my mechanic that's closer. You HAVE to be willing to walk away. Know what the vehicle is really worth (kbb) and be financed thru a credit union ahead of time.
Is it possible to get the MSRP sticker for a 2022 Camry as long as I have the Vin # I asked my salesman and was told it wasn't something he could get? I'd like to see what the original price was and what options it came with, I'm sure there's a way
For some reason there is a built in bias towards women buying cars. I am exactly the same way. When buying a car for myself, and the salesperson tries to speak to my spouse, as if I am not there, I tell the representative to look at me, and speak with me. Sometimes, the sales person seems surprised.
Back in 2010, I was looking at purchasing a new Camry. The finance manager wanted me to finance through the dealership even though I was pre approved through my local credit union. He was very adamant that I financed through them. He said he would take 6,000 off the price of the car if I went with them. I agreed and he was smiling ear to ear. What he failed to realize is I knew there was no pre payment penalty so the next week, I paid the car in full. I came in for an oil change soon after and he wouldn't even look at me. 😅😅
doesn't affect him in the least. probably didn't even recognize you. he's there just to get you in the finance office nothing more. and that tactic is well known
Last new car I purchased, I went into the Finance office, told them don't waste your time, I don't want anything other than the car and the manufacturers warranty I've got the money for the agreed upon price. They said ok, and that was it.
ask for out the door price. pay cash, say no to extras, get the keys and drive home. best yet is get everything done over the phone, and not expose yourself to dealers tricks and waste time on their tactics
thats what i do never even went to the dealership got the agreed price wired the money and they delivered to me im not going to waste my time at a dealership ive had no problems with selling my old one
The only problem with this method is sometimes a test drive will seal the deal. We had a car and was keen on it until we took it for a test drive. Smell like a cigarette factory and the pictures didn't show any of the negative things. So I'm glad we didn't purchase the car.
Kimberly is the real deal. She answered my texts in real time when I was buying my brand new 2021 Toyota 4Runner TRD Pro in Lunar Rock and had questions during the finance stage. She helped me tremendously. 😊
Excellent video thanks! Cars have become stupid expensive because they are overloaded with too much gimmicky crap we don't need. When a dealership looks more luxurious than a true 5-star resort, you know you're about to pay WAY too much for a piece of tin.
First new car deal I stupidly bought an extended warranty for like $3,000, went home and realized this was crap so went back and said I want to cancel this. Oh, they were pissed! Never forgot that. But in this video she talks about paying cash and how they hate it, In every other video they say never tell them you are paying cash until either everything has been settled, you get the out the door price, then at the last minute say you want to pay cash, or...just agree to their finance terms to get the best overall price of the car, then just pay off that loan in cash within a few weeks. Because if they know you will pay cash they won't negotiate the price of the car as much
If you dont get an extended warranty from the manufacturer you are asking for big trouble down the line when the regular warranty expires. And if you get one on the cheap from a third party company, same thing, you are asking for trouble, because they will screw you when you make a claim. Mark my words and sell the car when the extended manufacturers warranty expirees. You cant imagine the costs of repair as the car ages. Electronics are huge and can run into the tens of thousands down the line. We got rid of our X3 when the extended warranty was going to expire. BMW wanted 13,000 dollars for one more year on the extended warranty. Shows you how much confidence they have in their cars. Really.
@@AutoFinanceSense Thats when they say, "Because I like you, I'll give it to you for $1500. (Actually happened to me.When I refused the extended warranty)
@@shepardsmith3235bruh you buy a new car to have for 20+ years. Selling it after the extended warranty ends would put you under thousands over the course of your lifetime. Treat your car good and it will treat you even better. Unfortunently old age on my 98 yoda finally having major issues so will be looking into another 😊
Never paid for a new car always bought vehicles that were used with low mileage, paid cash always. Learned a lot from watching this video. I actually enjoyed the fact that you were honest.
If you put $40-50k in to ticker ARCC, you would get a 10% return (taxed in 1099-DIV). Average auto loans are ~7% for good-to-great credit. The car is going to go down in value while the fund is going to stay relatively flat and pay yields. You've been making a financial mistake by buying cars cash.
To live beyond what one makes is foolish , all my current vehicles were purchased 5,000 and up to 10,000. Saving money is easy when you work 40 hours plus, 7 days a week 365 days a year.
@@scottleggejryou are very wrong. For example i just bought a used lexus rx350 2021 with 38k miles for 29000. From which 10000 were coming from a credit card that will immediately give me around $1500 in points and have 0 apr for 18 months (could buy it fully cash though) The new car will always cost double from 3 years old with some mileage on it. Now, I don’t pay any interest, fees for financing and most of all pay $60 per month for the car insurance which saves me ton of money in the long term, compared to people who has to purchase full coverage. You gotta be smart at it
@@viacheslavfedunov111 Nothing you said invalidated my point of interest/asset. Buying cars full cash, up-front is a bad financial move. As bad as carrying gap insurance imo. Let the bank carry the float of the depreciation until it has positive equity on the float and is a positive-cash asset - although it will still depreciate.
I bought a 2022 C8 Corvette that I was planning to pay cash for but when I looked at my investment returns I borrowed the money at 2.9 % and left my money in the investments to continue to make capital gains and dividends. Sometimes it pays to use someone else’s money !
@@jiggidyjamCorvettes are usually buy and holds. He is more than likely going to own it until he dies. Its a calculated loss as a result. Life's too short to drive boring cars for auto enthusiasts, its just something accepted.
I was going to pay cash for my Porsche but ended up using a private financier that specializes in exotics. There's a reason they put you on waiting lists for Porsche's GT products - they *REALLY* want you to go through their financing services and pay extreme markups.
In 2017 we bought a new Chevy Impala with a base price of $36500K GM offered a flat20% discount on the vehicle. We already had a valid approved quote from Navy Federal CU at 2.69% the dealer said that it would take a week to get a check from the CU 100 miles away location they offered a 2.79% offer from Chase.(for 72 Months) WE had told the F&I person that we intended to double pay the note and be done in 3 years. We absolutely refused any of the "special coverages" that he wanted to add to the deal. we ended up cutting a check for a down payment of $6K to the dealer and paid off the car loan in 21 months! .
I put 6 grand down on a 30,000 4runner and he told l told me straight up that I would never need it. Then my wife totaled it and I got all my down payment back.
Solid info, and that comes from me being in the automotive retail industry for over 45 years. What I do, with dealers I am friendly with, is let them know I cam able to pay cash, but will agreed to finance. But in 120 days I will be paaying the note off in full. Then, I get the name and address of my finance company, and the account # of my loan. I pay off all but a litle more than three payments of the balance before I even get my first payment statement, so I am not paying interest on anything other than maybe a few hundred dollars. Then for the first three payments I pay the regular amount due, which will leave off the remaining balance. And for the fourth payment I pay off the balance. The interest $ I am charged is minimal, the dealer gets his finance reserve, and the F&I rep get whatever commission with no walk backs. The folks know I understand the game,a nd am eating a few dollars in interest in trying to keep their game in play. My approach sets a nice tone with these folks, but for the credit company likely not so much.
This explains why when I went to buy my last truck I found my own financing had a check in hand when I went to pick my truck up. When it came time to pay up I said I want the cash back option since I already have my financing done already. They left the room for a few minutes then came back in and told me that they would give me both the 2.9 financing and the cash back.
All of this information is very helpful. After my car purchase in 2022, I eventually determined that I was ripped off. I successfully sold that car and purchased a new car using my credit union. They were so mad. There was so much drama with this transaction but I successfully walked away with the car without dealing with the finance department.
I call the salesman with a specific vin I want to lease/buy, tell them I don’t want additional products, do not agree to meet the finance manager, provide info up front so the paperwork is ready when I get there. Get ootd pricing on the phone. If buying, I arrange financing. I usually pay leases up front - saves money. Sign papers. Need keys in hand in 30 minutes and out the door. They don’t make much money however I don’t take up much of their time. Fair trade.
Walked into a dealer two weeks ago with paperwork (Carfax, consumer reports research, advertised list price, etc.) on a car they'd taken in trade, posted for sale, but hadn't quite finished prepping. Stopped at the gas station during an extended test drive, and was paid to fuel the car... all good, exactly as expected. I 'accidently' popped the hood to look at the engine compartment... all good. Said I'd be back the next day with my wife. 24 hours later, wife test drives... all good. Dealer then asked me to talk about monthly payments, and handed me their sheet with 7k in add on's. Took my pen, crossed out their add on's, circled the asking price (which was actually below my well researched expected cost)... said... cash or check? As predicted, finance manager was less than happy with me. Salesman however was impressed, and asked if I wanted to sell Toyota's.
@@crisrose521 A bunch, but not all. There's a mandated fee by the SC State Government, and sales tax which I'd researched, and didn't ask to have taken off. Everything else I had taken off the bill.
I canceled an auto purchase from a dealership I had previously bought three new vehicles from when I found out they had marked up my buy rate. I expected the advertised top-tier rate because I had an excellent (820) credit score and they came back with a higher rate. The finance manager did a victory lap, pretending to be excited that he got me “approved“ just glossing over the fact that I had been approved for the top tier rate, and he had added on an extra 3%! That was the sleaziest, most slimy, used car salesman BS I had ever encountered. What made it worse was that I never even imagined such deceptive practices. I have never bought another thing from that dealership, in spite of me buying that auto brand exclusively for the past 20 years.
The first time I bought a car with my own financing secured ahead of time they pulled something similar. I agreed to let them run my credit and they came back with a “better rate.” The payment was higher than I had calculated with my already secured loan. As soon as I asked them about that, they yanked the paper work back and reworked it with my own funding. I never knew how they managed to arrive at that monthly payment.
Never have I ever heard of a 3% Mark up on the buy rate. One point or a point in a half. Maybe 2 I don’t think theirs any bank that lets you markup the rate that much. You’re playing with their money. It adds risk to the bank.
@@charlescuthbertson709 Honestly, it seems like it was more… but I do not remember the exact amount. What I do remember was them displaying a good APR for those with excellent credit, me having excellent credit, and them coming back in the room proud of themself that they got me approved, albeit at a higher rate reserved for those with ok credit. It didn’t add up so I immediately did some digging, and when I found that I had indeed been approved for the best rate and that they had lied and tacked on an additional percentage, I was livid. I walked out and never returned.
I made a deal on a Toyota once with the salesman. It was tough negotiating but we agreed and I told him that the agreed to price was every penny that I was going to leave in his dealership and I wouldn't even buy a Coke out of his vending machine and that he had better tell his finance guy that because if he starts dicking around I would walk. Well the finance guy did try slipping something in and I got up from his desk and walked out and never went back. He killed the deal because he thought he was so smart that he could slip one by me. No. No sale.
I've been to 2 dealerships that will not sell a car unless it is financed through them. They don't care if you have a sack full of cash in hand. They insist on creating a loan.
I've gained plenty of knowledge between you and Car Edge Father/Son team......it's just trying to retain or recall it all whenever I get around to actually purchasing a new car!
Former f&I guy. Ya she pretty accurate. The reason we hated hearing "cash deal" is bc it destroys averages on per deal gross and product penetration. I've lost thousands of commission dollars in my previous career from cash deals lowering my monthly % on my total numbers. You can always negotiate all products. Finance managers would rather sale at low profit then take a zero on numbers
I love these videos! I couldn’t give a sh!t what the finance manager hates hearing! I hate sitting in that room as they try shake me down for every useless option! My next car will be through a subscription I hope subscriptions kills the dealership! I bought a warranty for my last car. Whenever I bring my car in “it’s not under warranty” I ask for the manager & “the service manager put in the wrong code, of course it’s covered!” 🙄
I bought a niche car where only 10,000 were sold for that model year. Because it was so unique I paid sticker price because the dealer would not have budged on the price anyway. In the finance office the guy tried to sell me on wheel protection and a extended warranty. I told him that I never buy extended warranties because if something is going to happen then it will happen during the warranty period, plus I been screwed in the past by warranty companies. I also told him that the savings of not buying an extended warranty over the last 20 years means I can afford to take a hit if I have to shell out a few thousand dollars on a repair and still be ahead. I handed over the check from the bank and it was a done deal.
Ummm 10,000 of a vehicle is a lot bro. That’s not rare and special. I have 1 vehicle that only has 500. Another one has 3000 made and 5000 on my 3rd vehicle. Not too many companies sell more than 10,000 of a vehicle. Somebody has fooled you with that number. Just think first example there were only 3000 2019 ZR1 corvettes made and it’s not considered a limited run. If your car is numbered with a plague it’s not special and even some are numbered and 2000 were made and they’re not considered special it’s just the manufacturer who tried to make it feel special to try and sell for more but it only has a sticker package that makes it different from their other exact model.
When I retired, I bought/ordered a new car as a retirement gift to myself. First, I sold (as always) my old car for thousands more, than the dealer would give me for it. Secondly, I am not afraid to walk out of the dealership. Third, the dealership offered a rebate, that had a requirement to finance through them. I checked the numbers and if I paid it off early I didn't get the lower price. Did my homework and put 1/3 down when I ordered it. And the last day, of the time stipulation, paid it off totally. Saved a few hundred there.
Great things to point out, but also all things that buyers wouldn't have to worry about if they were well educated and finance managers weren't crooks in disguise.
Thanks for this video. It's a shame that we have to go through life assuming that every person we buy something from is conniving to rip us off. I am not sure how as a society we arrived at this state.
And it is the learning disabled and those who have bigger issues going on in their life (like a family member in the hospital, or a recent death) who get ripped off the most, because they don't have the brain power or energy to defend themselves. I agree there is always room for better ethics.
dr, wrote, _"I am not sure how as a society we arrived at this state."_ The simple answer is 'capitalism'. People often bristle when I mention this but it's pretty obvious to anyone who dares to take a careful look at the point. Prices are arbitrary. They're based on 'what the market will bear', rather than on anything remotely related to 'how much it costs to manufacture'. When people are doing well financially, it's the legal responsibility of corporations to maximize profits for their shareholders. Let that sink in: it's their **legal responsibility** to maximize profits. So, the car may cost the same, but if everyone's swimming in disposable income, and willing to spend it, then corporations have a *legal responsibility* to 'game' for some of that money. Not because their product or service is 'worth' it, but because they're obligated to maximize profit. In essence, a capitalism-based economy requires -- yes, it **requires** -- infinite growth. So as long as one lives and transacts in such a society, those on the selling end of the transaction will alway be looking for ways to extract the maximum amount of profit from the buyer. If this doesn't sit well with you, I understand that feeling. It doesn't sit well with me, either. But, that's how it goes.
You are correct..then walk out with that price and shop it to other dealers and let them bid for your sale. I do it by email so only the winner will see me. They never get my phone number
I just go through the process, decline all the options. Then, circle back with my credit union which buys out the financing and I get a great rate. Currently paying just a bit more than my mortgage rate, 3% something.
I didn't even know you could cancel products like warranties after the fact, I thought it was part of the legal contract made at the time you signed docs and bought the car.
The best is always cash, but not everyone is in a position to do so. Best advice is to buy 1 to 3 year old - spend some time on the internet and you can find the exact car you want. The original buyer took the biggest depreciation hit. These days, dealers mark these up to about the price of new so you have to do your research which is easy today with the internet on the true market value. If you can find an individual seller vs dealer, will be way better for you. Plus, some states do not charge sales tax if you buy from an individual. Never pay for any of the add on’s they try to sell you at closing!! Repeat, NEVER! You don’t need them and it will be way cheaper to just pay for it if you damage a wheel or something. Great video and no need to be intimidated by the finance guy, they are just another car salesman and not as smart as they try to present themselves.
#7 (late mofel used) they hate it when you say "NO" to buying an "EXTENDED WARRANTY"...even though the dealership WON'T HONOR that "extended warranty"!!! Because they get a kick back for selling that warranty! About half the price to you.
Just as a general "rule of life" for me, personally, having lots of cash in savings is so much smarter than tying it up in a vehicle. I'm solidly middle class, and I don't know too many people who have at least $5k-$10k cash, in savings, for emergencies. Once you sink that much cash into a vehicle, you obviously lose the liquidity and you'll probably not get it all back if/when you sell the vehicle down the road.
I was buying a car. They offered me 18% interest. I said I am paying cash. She told me I would be better off investing that money. I said earning 18% long term after income tax isn't reasonable. She pretended not to understand that concept. I bought private.
The most important thing I’ve learned after spending countless hours at a dealer with them trying every trick in the book they have to rip me off is never give them your license or keys. You’ll be held hostage until you’re worn down to the point you’ll sign anything they put in front of you. The last time that happened to me I told the sales person either give me back my stuff or I’m calling 911. Amazing how my stuff reappeared.
My seven things that I know are: the invoice price, dealer holdback, whether the dealer floorplans or not (almost always yes), the residuals at 36/39/48 months, the lease factor, how long the dealer has had the vehicle in inventory, and my state doc fees. I have a little folded piece of paper I consult in my pocket that they see me reading but can't see what's on it. Drives the sales people crazy. Another thing the dealer absolutely despises is when I'm walking out or terminate an e-mail exchange because of an inflated price, BS or both, I say bluntly "I can't afford this vehicle." Emphasis is not on afford but rather THIS VEHICLE! "I'm not going to waste any more of my or YOUR valuable time." What are the first words out of a dealer's mouth -- what if we could lower your payment or we have this other vehicle which is cheaper.
Hey Kimberly, I recognized you from car edge and am very grateful for the clear and concise information you’re sharing. I’m getting ready to buy a new yo me vehicle and there’s been so much I didn’t know before starting my binging of informative videos such as yours. Much appreciated and love from AZ :)
I just recently bought a car. I have bought 3 cars through Capital One. When I went in I say I will purchase a car through Capital One and no one else. They wanted me to go with someone else, they were like Get a better rate. I know Capital One and they are awesome. When I finally get to the finance manager he was trying to sell me a warranty. I got it and realize when I ask how do I use the warranty. He was hemming and hawing. He wouldn’t cancel it. I called the warranty company myself to cancel. When you already have approval from the bank and you are not desperate
Ask from finance folks: what is the buyer and seller rate? You will see their spirit leaving their bodies. As newcomer to this country. I used Kimberly tactics and avoid getting 18% interest rate. They told me I would never get anything lower than that as I had no credit history. Went to my credit union, got a 9% offer, instead. For new people coming to this great country, sometimes it’s not that easy to simple say no, but one must learn the tricks to reduce massive loss.
For the last 20 years or so I have always paid cash. I dont tell them I'm a cash buyer until I'm sitting at the F&I table. Only then I tell them lets cut to the chase, I'm not interested in buy and sell rate markups I am a cash buyer, give me your best deal. Usually at this point the sales manager comes in. Grant it, I usually do buy the platinum extended warranty as well as the tire warranty (Ive had 3 $300 tires replaced this year so far at zero cost). In the past they have tried had to push 0% finanicing saying use their money, not mine lol. No thanks. Your video is very informative and spot on!
@@Leslie83249 how that seem illegal? Some dealers send paper contracts to the lender. It takes time for the lender to receive and process the paperwork and set up an account and mail a statement If you looking to payoff a loan that fast you probably shouldn’t be taking out a loan.or didn’t need to.
@@thegerm574 stealerships are being greedy and its much worse since the pandemic. At one point, dealers were turning away cash buyers (I don't if this has changed since I hear no one is buying and they are getting desperate) forcing customers into loans.
@@thegerm574 I think that most judges or legal entities would view a contract that states "no pre payment penalty" as just that....unless there was language in the contract saying you cannot pre pay for the first 2 weeks or 30 days while administrative work was being done. If a borrower could show the judge that they were willing, able and wanting to pay the loan off right away on a contract that simply states no pre payment penalty then the borrower would be awarded back any interest or fees charged.
Just found your channel. I can't express enough how much I appreciate this video. This knowledge is really going to come in handy. I subscribed and saved this video to my VEHICLES playlist 😁
Just to add to the "phone a friend" part. Make sure you let the friend know ahead of time that you might call for advice and around what time you might be calling. Don't just cold call someone and put them on the spot when you're looking for important financial advice.
Thanks, going tomorrow to buy a used car. Not looking forward to it at all. I hate sales BS. I smell it a mile away. My statement on financing is usually, "As a member of X Credit Union, I would give you an opportunity to beat their rate, AFTER we talk price." This helped me prep.
Here In Louisiana our roads are horrible, so the tire, wheel and key fob protection plan is well worth it when they repair or replace your tires and wheels for 5 years unlimited miles
I bought a new Ridgeline in May. I had a low mileage trade, $10k down and my credit score was 805. I knew what I wanted to pay. Got it for $2k under invoice and $11k for the old car
My ex-girlfriend came to me really excited about getting a new Nissan Altima. She was trading in her used Honda Accord, and thought she got an amazing lease offer. It was only $349 a month or something like that. Looking over the paperwork, I saw that they subtracted the value of her trade-in from the price of the car BEFORE dividing it in half for the lease computation. In other words, the dealership STOLE half of her trade-in value. I went back to the dealership, put the entire value of the trade-in on her half of the lease, and the payment was less than $190 a month. The sales guys looked like they wanted to kill me. Then I broke up with her. On her birthday. Not a great boyfriend, only a great negotiator.
Absolutely agree Kimberly on pitting one dealer against other on cost of products. 4 months ago purchased 2023 Hyundai sonata limited CPO with cash only. The selling dealership price for a 10 year wrap VSC was $1900. They originally wanted $2900. But i used car edge vsc against them. Once i was back home in Tennessee. I purchased car in PA due to so many Hyundai dealerships near me played games with OTD price. So im F & I manger of dealership near me. He says $1700 for same VSC. Immediately call the F&I i purchased the VSC from and put him on speaker phone. After back forth got it down to $1450 from dealership i purchased. Dealership i was in only down to $1578. Yes i was well within 60 days to void. So saved $450 by using this technique. Thanks again Kimberly for all you do.🎉 Frank from TENNESSEE
I've found in the past (I always lease my vehicles, since 2001) that dealers add "port installed" options like mud guards and roof racks that I don't want and when I tell them I won't pay for it, they say you have to, it's on the car already. I'll be more aggressive when I order my 2024 crossover, as unlike 2021 (pandemic), I will have a choice of vehicles and manufacturers this time! Also, my husband always accompanies me to the dealership; he's a CFO and has a MBA in Accounting and Finance, so I trust his knowledge and math skills. He can also add big numbers in his head and works with multi-million dollar budgets, so he knows a thing or two about wasteful costs and bloated profits.
In the southeast, certain dealers are adding options at the port so they go on to the monroney label (sticker) on their lot. It's sneaky!! Sounds like you're on the right track 👍
"When I tell them I won't pay for it, they say you have to, it's on the car already." If you fall for that line, you lost the negotiation. You don't HAVE to pay for any of their dealer add on crap. The "it's already on the car" thing might be true in some cases, but it's a negotiation tactic all the same. I have told a Porsche dealership that I won't buy the car at all unless they take off the stupid "anti-theft" device they added. They wanted $1200 for it, and of course the car already has a factory alarm. I'm pretty damn sure an installation tech comes around to their dealership on a weekly basis, puts one on every car they have on the lot, and charges them $45 each. I made them call the tech, make a special trip to the dealership, and remove it in my presence. It was under the hood and simply unplugged...no wires cut. Also declined all the other crap they tried to push. I have told a Honda dealership that I won't buy the wheel lug locks, and in fact I won't buy the car with them in place. They argued they had already spent $380 adding them to the car. I walked back to their parts department and found out a set of them was $19. They put the standard issue lug nuts back on in my presence and it took them six minutes. $380 my ass. Also declined all the other crap they tried to push. One of the items was pen stripes, which they said were hand painted by a specialist. Really? The exact same stripes are on the car pictured on the Honda USA website, and they are clearly stickers that are under the factory clear coat. They wanted $250 for those. $250 my ass. They didn't even do anything for those except make up their pen stripe paint specialist story. I've been doing this for years. Never owning less than eight cars at any one time, and NEVER pay for ANY of that crap. Yeah, it's an annoying negotiation fight, but it's worth it. Actually I've gotten used to it, and it's kinda fun to see what bullshit argument they'll come up with next to support the outrageous prices they ask for those things. It's best not to bring any of this up until after you've spent a couple hours at the dealership. Test driving, making the salesman tell you all about the car, letting them bring you cokes or whatever. Don't bring it up until the final moments of negotiations. This way they've invested a fair amount of time on you and got their hopes up. And if they let you walk out it's all wasted.
I’m 67 and I buy my (still under warranty) used Volvo from sellers, not dealerships. Never knew they add on junk. I use my credit union to make a $300/ mo payment.
Another useful video. Despite all I have learned from car edge and you, and the fact that the prices are finally coming down to a more sensible point, I’m still staying out of the market because I’m saving somewhere in the neighborhood of $8400 a year by not buying a car. That makes it really hard to pull the trigger.
I’m of the same mindset as you. I couldn’t agree more. I just think of all that money I got retain every month that passes by with no car payment. I then dump it into more stocks instead and smile into the next month.
Car Edge is a business model to sell prenegotiated deals at a profit, as well as finance products. Zack understands how social media can influence people.
That is why he pushes all that stuff so hard. Ray knows the money is made in the F&I office, so Zach is trying to be the F&I office without having to sell cars. At best, most of these products are about covering up that people are massively upside down and overleveraged in the car loan. The rest are just flat-out scams.
I have more of a problem that Zachs dad used to be a car sales manager and have probably pulled the same tricks on others. Now that he's done, he's telling us some of the tricks.
@BDBD16 the problem is that now that he's had his fill he's now using the knowledge to help monetize what he can for his son. To each their own. I'll get my info elsewhere but you do what makes you happy sir.
Most dealerships sell reputable warranties. I am a technician, parts are outrageous and labor is no joke! We sell policies that cover your vehicle bumper to bumper for 10 years or 100,000 miles. Your extended warranty will pay for itself the first time you need it. Especially when your radio head unit is five thousand dollars, not including labor. I can repair my own vehicles, but purchase extended warranties to cover part costs. If I never use it, great - just like my car insurance. If my transmission fails, I just saved twelve thousand dollars.
That was my view with my additional warranty - it’s an insurance policy just like any other insurance policy, and it was worth it to me, even though I never used it.
You do not sell warrantees. You sell extended service contracts. There are no "bumper to bumper" extended service contracts. The only reputable extended service contracts are those offered by the manufacturer. All third party ESCs are dubious at best and scams at worst. If your transmission failed, you did not save $12,000. You must reduce that savings by the coast of the ESC plus any lost opportunity costs which you would have received had you invested the amount of the ESC. If your transmission fails, that ESC might pay for the repair. But it is far more likely there will be some loophole which the provider of the ESC will use to deny the claim. The devil is always in the small print.
I got 10k of a new Cherokee in 2019 because they had the feature list on the window. I got on jeeps site did - build - plugged it all in and showed it to them and said, so why should I buy this here instead of just ordering it direct? They changed the price for me to match what the site said it should be
dealerships don't sell cars they are loan originators. show me an extended warranty that extends the manufacturers warranty....you can't. if you think you need more warranty wait until the manuf warranty is near the end. they're going to send you offers in the mail
Just bought a Hyundai 2 weeks ago with 0% financing. Not sure if the finance manager was overbooked for the day or short staffed but he rushed right through everything and did not push for any additional products. I was prepared to say no no no, but didn’t even get the opportunity. Lol
@@NickChemist-yf6oj it’s my 3rd Hyundai in 30 years. Buy a new one every ten years when the old hits 150k plus miles. Until they give me a reason not to buy them, I’ll keep coming back. Started with an Accent, then a Sonata and now a Santa Fe.
Don't buy a product if you're not 100% certain you want it. I had a situation where I bought a warranty because I was exhausted and wanted to get out of the finance office, and I could not get the F&I guy to return my call. Eventually I had to call the warranty company to cancel.
Yeah...saying you're calling a friend for advice is great...this will sicken them. Also...be in NO hurry...they hate when you are like "let me think about it overnight" - LOL I've had sales people say stuff like 'someone else is interested, so it might be sold if you don't jump on it now' - I always advise them to go ahead and sell it then, because I can find another car LOL - They HATE that - They want you to be emotionally invested in the vehicle, or really need to buy soon. Best to be indifferent to the vehicle, and especially to buying ANYTHING...'just thinking about it' - Now YOU'RE in the driving seat - if you love the vehicle, THEY are driving the deal
I have used all of those myself. I am in no hurry to buy today. I’ve got all the Time in the world. I don’t know. I don’t really care for the color but maybe I could live with it. I don’t know if it’s gonna fit in my garage. They always say to someone else is interested. I always tell great sell it to them and then they default on the payments called me. They hate that.
After all the bad experiences I've had with different car brands and dealers, I don't care what "deal" they're offering, I'm paying as much cash as I'm comfortable with and getting a loan for the balance from my credit union. The less I deal with anyone at a car dealership, the better; they are vastly more experienced at having an advantage over the average, only once-every-so-many-years buyer.
THANK YOU SO MUCH. Among all the videos I've been watching this one has bridged the gap the most effectively and efficiently. You provide the timing the terminology and the rationale behind the finance manager and us as the consumer. This has honestly been one of the most valuable videos I've watched on car buying thanks to the simple but industry standard terminology being condensed into the one video.
Thank YOU so much! @makaeo8085 That means so very much to me! 🙏 I think it was my first video where I said, I realize dealership finance is far from an exciting topic but that hopefully I can simply help people understand the process and save them some money. Thank you again for being here and your kind words.
I do buy extended warranty and servicing because in the past it has served me well. On a $51K car, it came to around $3,500 combined (Toyota) and given how sophisticated the mechanics are (it's a hybrid PHEV) you are at risk of severe out-of-warranty bills. In the past it has served me well, but be aware that in many cases you can bargain-down the price. These days I pay cash, always, but in the past, when I was poor, I used my Credit Union as they offered the best rates. I hate going to dealers, but as I tend to buy rather exotic (aka halo) cars or unusual models (Rav4 Prime), I consider it a win if I buy at sticker price. My goal, buying a car, is to be in-and-out within two hours, everything signed, with the car ready for pickup in the afternoon or next day. My overriding advice to all car buyers is this: be entirely ready to walk out if it isn't going your way 100%.
I normally lease my vehicles & GAP is automatically included. Dealers not make to much on leases. Only downfall no more $0 down $199 lease deals on Civic, Corolla etc. like they use to have & you need to put hefty down payment to get that price & not worth it.
I paid cash for my last 2 vehicles. It was the most "unfriendly" back and forth with the finance manager. Another dealership that I will never go back to got angry when I said I was going to shop around. He refused to put his offer in writing saying, "I'm not going to give you something to take to another dealership and compare."
When I speak of "Products", I mean the ones being sold in the dealership finance office. Typically on a "Menu" (see my other videos). For example, the Vehicle Service Contract a/k/a "extended warranty", GAP, maintenance plans, dent/ding, paint/interior protection, tire/wheel plans and so on. I have videos on each of these on my channel. Also, you can jump to the 8:18 Mark of this video: th-cam.com/video/xicg4_VimTY/w-d-xo.html And be sure to check out ALL my videos here: www.youtube.com/@AutoFinanceSense/videos
The previous owner must have had a really long loan as my Sister bought me outta my trust a 22 Camry & they neglected to tell us that I need a ATT hotspot even though my phone has it on there, Toyota must have a contract with ATT since nothing worked as far as safety features and the salesman just told me keep my phone plugged in and I'll see the maps? Nope after pressing it different times it said unavailable no subscription when in fact after calling ATT for a trial the previous owner had 8 years bundled with his loan, since I'm handicap & 25$ for a hotspot plus my cellular bill with consumer cellular & My Government plan for internet there's no way I can swing it and my Sister wrote a check outta my trust! I've technically had it a little over 2 week's shouldn't they have to pay the hotspot? I brought it back and paid the rustproofing against my Sisters wishes from the $ for the totaled title on the Mercury 3,300 I believe? I wasn't going to watch this video since my Sister already paid with a check basically cash but I'm glad I did! Any advice on getting them to update the maps and navigation system & take care of the hotspot would be appreciated since nothing is working since Toyota connect navigation system entune no longer exists but they do have updated maps which I believe they uninstalled while it was there 4 days getting re detailed mud in the side pockets and the rustproofing, gosh I hope we didn't get a Florida flood car? Mud in the side pockets of a Camry door is pretty odd
I made my deal at Toyota and then said I was putting 20k down and financing the other 15k. Finance told my salesman (who I liked) I had no credit at all. Some crap about it wouldn’t even show up but I could borrow from them for 18%. I called my credit union and was approved in five minutes for 5%. When I picked up the vehicle the finance manager never offered his hand and ran through the paperwork as fast as he could without even offering me to buy extras. I was happy, he was not.
Yea, but buying any vehicle for $35,000 is stupid to begin with. LOL.
Nothing wrong with buying 35k car. Buy what u can afford. My last 2 cars were 65k each. Don't hate on people that can afford more than you
@@sallyboy66 Boy if you only knew my net worth you would feel real dumb. Can probably afford waaaay more than you but not dumb enough to blow money on stupid shit.
@@sallyboy66 < --- Finances expensive vehicles and he thinks he is smart. LOL.
Had a dealership try to say our credit was in the 600's some years ago and threw around a crazy interest rate. We had apps for every credit agency and pulled a report on the spot showing we had well into the 800's. They came back with some bs that they entered the wrong social security number and came back with a report with the correct rating. That was the last time I financed a vehicle. I go in now saying I'm going to trade something or I'm going to finance then, hit em with a check at the end.
Do your homework. Walk in the door and make an offer. No matter what they say, walk out. They will either chase you down or watch you walk away. There are 5000 dealerships.
BINGO!!
Better yet is don't go to the dealer and do everything by email. Takes away all their power to play games with you.
Never be afraid to get up and walk right out
I have a question how much is a dealership is supposed to make ?
I want to be fair to the dealership
They have families to feed too
@@Breeze-gd8wjBelieve it or not dealers don't make all their profits on the sale of a car. Finance , Parts, and Service are often the bigger profit centers. I would not worry about trying to be fair when buying a car. A dealer is not in business to loose money. When you negotiate a price there will come a time when the dealer stops working downward on price and refuses to budge. For most cars I'd say 7-10% off MSRP is a good savings for you and the dealer is still making plenty of money. Some cars are even discounted more aggressively if the dealer needs to move them. It's a moving target and no two deals are the same. Worry about you, not the dealer.
I just helped my daughter buy her first car last year. We had prearranged financing through our credit union at a rate that was less than half what the finance manager had quoted us. They refused to sell us the car after having the deal fully negotiated. We called another dealership that had the exact same car a few miles from the first dealership and told them what was happening and they told us to come on and they’d accept our financing. That turned out to be one of the most comfortable and easy car purchases I’ve ever been involved in.
sounds like they were just angry! GOOD it better to go somewhere else! if they are like that. its ok for them to rip off the consumer but when you try to do it to them they get bent all out of shape
You need to practice saying it at home and hear youself to overcome any doubt or hesitancy, it does make a big difference.
@@blakespower No they didn't wanted to rip off the dealer because it's not possible lol , they just wanted to buy a car without being ripped too much.
Back in the recession a few years ago, my wife and I purchased a car. The interest rate wasn’t too high through capital one finance since my credit rating was so good. It was only seven point something and then I refinance it through the local credit union where I deal with interest rate is 2.9% you can’t beat that. I almost have a car paid for now. it certainly pays to belong to a credit union. They are much easier to deal with in my opinion than a namebrand bank.
Yep, always show them that you got options. Dumb for them to not even consider it.
Great video! In 2020 I needed a car now, and found one. The dealer played the keep them here all day so they will sign anything. I paid the cashier my deposit and when I finally got to the finance butthead, he turned out to be a shyster. I kept asking the APR and he kept avoiding it. When I bought an extended warranty but none of his other crap, the APR rate changed. He actually said, since I am buying less he can't give me the better APR. I was livid! After almost 6 hours in the dealership I was wishing I walked out. However, the next day I called my wife's credit union and they gave me an APR less than half of the dealer. They paid off the loan that day, which was the next business day from when I bought it. I also left a bad review to the manufacturer. The finance guy actually called me at work and started yelling at me! I hate being manipulated. I hope he lost all of his commissions!
If you're in the US, the practice of charging you a higher interest rate because you're buying less of their products at the finance table is called "tied selling" and is very illegal.
I wish I knew this back then.
@@sammysleeves33
Weak finance managers do this. REAL finance managers can actually build value in their products with out playing these games....and yes, some of their products do have value.
you got suckered into an extended warranty. don't buy that until the regular warranty ends. it didn't extend anything
When I bought my truck I get it through the employee purchase plan for ford motor.
Ford sets the price which in my case is 2 percent under dealer cost. The dealer is compensated by ford motor for a predetermined amount.
As far a extended warranty goes I also pay wholesale price plus 100-200$ that goes to finance guy.
The finance guy actually got out a book and showed me the dealerships cost price on the warranty only then did I agree to buy it . The cost was only $1100.00 on a $95000.00 truck for a 7 year 200,000 mile warranty .
We recently had planned to buy a car at a dealership, but if I paid cash, the car would be $5K more than if I financed it. We did not want to be making payments, but they told us that they get a kickback from the finance company, so they can sell the financed car cheaper, but the contract would say that we must not pay it off before the 6 months, or we’d lose the $5K discount. They really pushed the idea of getting the financing and just paying the loan off in 6 months with no fees. To me, that was a great deal for them and an unnecessary minor hassle for us. As a result of their inability to make the deal attractive to a cash paying buyer, we walked away and found another car at a different dealership, that we paid cash for with no games.
I wouldn’t mind “financing and paying it off fast if they could give a great rate which I think is still high.
We ran into a similar situation and ended up financing the car and paying it off on the first payment.
@@Ryan-rn8gk They said we had to make payments for 6 months before we could pay it off, or we'd owe them the extra $5K. I was not willing to reward them with buying a car from them under that silly game. Their rate was not great either.
@@Leslie83249 Their rate was not great, but I refused to be roped into financing. They lost a sale from us, as we ad cash in hand, but spent it on a different car at a different dealership.
I don’t blame you.
This is why you should always get the OTD (Out The Door) price for the vehicle you’re interested in.
NEVER answer when they ask you how will you be paying till you have the PRICE for the vehicle. You know it's going to be higher if you say cash.
Yes. well said always ask for outdoor price first once u see them numbers than you can bring up a trade in never b4 and double check that paperwk very carefully because then bs add on will be on and if you don't catch them guess what that's coming out of your pocket and if that sales person or Mgr isn't willing to work with you, you go to the next dealership it's that's easy!
Exactly! I hate it when the salespeople ask me how much I am looking to spend per month. No, I want to know how much the vehicle is going to cost me after everything in total. They can make the monthly payment be whatever I want it to be, but I might be paying for the vehicle over a decade or more.
You also have to watch those low APR deals like 0%. The finance managers always try to hook you with giving extra money towards the vehicle if you take a higher APR deal. It never works out unless you plan on paying off the car quickly (like paying it off the following month to a year max).
I need to know how much the car is going to cost before I know how I'm going to pay.
@@Babyshark2469 - or just drive the car until the trade is effectively worthless. My 2012 Mazda3 with 200k miles was a $900-$1500 trade.
I didn't even bring it to the dealership other than for my first drive of the prospective vehicle. Once I decided and got a number, we came back with the bank draft in my wife's car.
I drove my car around with a for-sale sign in the window and sold it in a week to a family with a new teen driver.
| got 3x-4x what I'd get in trade allowance and a family got a good starter car for their kid.
I’m not going to a dealership to be friends. 😂. I couldn’t care less about the finance managers feelings or his bottom line. Either we do business on my terms or I’m going down the road to the next guy. Great tips! Empower the buyers to be educated!!
Exactly.
I love seeing their faces when I'm the one screwing their "deals".
Yeah, right on! I have enough friends!
Quite a few of them wouldn't lose any sleep over marking up full commissions on their own families. They'll try to say it's a business. That's true however you give a discount to your loved ones
Yup, boss up. They lie so much. They sell the financial instrument, purchase margin stock for the credit provided to you or on your behalf, get FDIC or other insurance and still want people to pay, which is like the third time they're paid, lol. Gain financial literacy or be owned by the CFOs, Finance Managers, brokers and dealers etc.
If any finance manager doesn’t accept a full cash offer they are doing their dealership a huge disservice. It’s called cash flow which they could be investing in immediately and cash in the door now should always be a priority to any business.
Dealerships get paid right away, it's called being funded; it isn't the 70's...cash deals cost money.
@@geographyinaction7814 you can’t get funded any quicker than full cash up front
Mr dud, you couldn't be any more incorrect.
Awesome vid. Used all your tips at the Porsche dealership. After buying the vehicle & moving through the finance room, nobody came by to congratulate me or shake my hand when I took delivery of the car. That's how you know I got a GREAT deal!
Big congrats to you! 🙌
That’s also how you know you bought at a BAD DEALERSHIP!!!!!! Do you want to deal next with the service dept.
I used to work for a bank.. If you really want to make the F&I guy sad, FIRST negotiate your best deal... THEN tell him "oh by the way, I'm paying cash." Lots of times they'll work you a great deal on the price, with the back end finance profits in mind.. Also (forgive me if its been said) but always (if you can) buy on the last day of the month. The dealers are desperate to unload units on the 31st because on the first, they get hit with a flooring bill for each sled still on the lot.
What's "sled" ? You said "for each sled still on the lot"
@@highwayhash007 Car dealers are very sarcastic, bitter, fussy people; and they often refer to unsold cars no one wants, as "sleds" (pejorative not literal) and if a particular dealership has lots of unsold inventory (like say Ram Trucks which has like a 787 day supply) they refer to that dealership as "a sled lot" like trying to sell sleds in the summer. Good salesmen avoid sled lots, and try their hardest to land a job at a Toyota (which has 60 day supply) or some other more popular make, because they're easier to sell. Anyway, "a sled" in dealer slang, is just a car that no one really wants.
I guess thats why they keep nothing on the lot except overpriced used cars
@@milfordcivic6755It is true that there can be a big advantage to buying at the end of the dealers month because the dealer has to refinance all of the inventory on his lot every month. He is working on borrowed money too.
One problem though is knowing when the dealers month end is.
They can all be different depending on their agreement with their financial lender.
Some will be the 30th of every month while others might be the last business day of the month. Or some other date?
If you don't know and the dealer has already refinanced the inventory yesterday you will have no advantage today.
@@milfordcivic6755I was thinking this as well. What dealership are they at that still has new Toyotas on the lot (not counting the monstrosity that is the bz4x)
I bought an extended warranty on my last vehicle. It was around $2,700. I changed my mind about a week after signing the contract, called the finance manager and canceled. My loan was through Wells Fargo. I went onto the WF site about 10 days later, accessed my account, and it showed a credit for the amount of the rescinded EW. My loan monthly payments were a little over $300/mn. The net result is that i didn't have to make a payment of my loan for nearly a year.
Because they still made money off your loan sitting there
And you still paid the interest on the money you didn't pay over that year.
I Just bought a car with cash couple months ago. The finance manager didn't say a thing just counted the cash we signed paperwork in and out within half an hour Loved It!
The less you hear from those snake oil salesmen the happier you'll be. Good job paying cash!
Most legit dealerships will only take a cashiers check. Very few are taking cash….
When it comes to large sums of money, apartment managers, car dealers, realtors, mortgage companies, banks, and the government are all much happier with checks or debit/credit cards of one variety or another. It means there is a paper trail as to where those dollars came from and orders of magnitude less likely to be drug/illegal money.
Also, if a cop pulls you over and finds a large amount of cash on you, he can simply confiscate it. Many people have been nailed by this. It's called 'Civil Asset Forfeiture' and they don't have to charge you with anything at all to do it. Look it up.
Was this cash transaction over 10k ? because if so, I have questions if you were still able to drive off with in the half hour.
@TheHef12345 nah most will also take debit cards
This should be shown to every high school student, with the final explanation, "If you want a car, use self-discipline save your money, and buy with YOUR cash."
People who scrape money for years to make a big buy will make damn sure they're getting the best possible deal they can find. You respect the dollar amount much more when its money you already labored for.
I cant wait until the dealer model is gone. Pay cash and just drop it in my driveway, leave the title on the seat and I will register it. Take that $1000 doc fee and shove it.
💯@@davids.9834
@@davids.9834 I don't understand... explain.
I definitely wish I had this knowledge back in high school, I would have made smarter money decisions.
Well said this younger generation wants instant gratification. Make a plan and save your money!!
I negotiated a deal with a Salesman at the dealership. Then I went to my credit union and secured financing without the salesman knowing.
When I returned and the salesman heard what I did he was physically ANGRY.
I simply smiled and said my Credit Union gave me a better deal. It was very satisfying actually.😂
“Finance managers” are just another level of sales people. Remember, what they present you on the table is their profit center.
Exactly!
@@antoniodavid2253 the world revolves around is profit; its a job
There's a reason they don't have their finance degree diploma on the wall 😂 you don't even need a associates degree to be a finance manager
Yall mad that people make a living; you do know that how Yall get paid too by profit made by your company
@@yiehnewtamiru7324people who sell useful products or services usually don't need the pushy sales tactics and other bullshit that finance managers at dealerships make their money from. There's literally no reason for that job to exist.
This lady could literally make a career out of sitting there with buyers at the dealership and negotiating for them.
Thought the same thing. She could be a consultant for car buyers
Eventually they would lock the doors when they saw her coming.
Yes! I was going to ask her if she would be that “friend” I would call while negotiating the deal.
I would hire her for a fee!
I literally was sitting here thinking that very same thing watching this video.. What the world.. why is buying a car so frustrating hard to get the vehicle you want at the best price.. sure a dealership has to have some profit to stay in business but all these back door “money makers” only to take advantage of people is insane to me. It’s hard enough in today economy to survive with rising prices and inflation affecting the market interest rates to have these unethical and deceitful money making tactics being used on people. Very frustrated as I am in the market to buy a new car soon.. uggh 🫤
Bought a mint used jetta in 2020. Dealership pulled every single scam but I wouldn't budge. Wanted me to pay $400 for nitrogen filled tires. Lol. Said I'd walk and got that for free. Tried to sell me oil change package. No. I'll take it to my mechanic that's closer. You HAVE to be willing to walk away. Know what the vehicle is really worth (kbb) and be financed thru a credit union ahead of time.
Use nada values, it’s what a bank will use to determine LTV. KBB is a scam designed to lower trade-in values and raise retail values.
Is it possible to get the MSRP sticker for a 2022 Camry as long as I have the Vin # I asked my salesman and was told it wasn't something he could get? I'd like to see what the original price was and what options it came with, I'm sure there's a way
As a woman, I’ve walked off lots when no salesperson has time, even when I had the money In my pocket.
I as well
For some reason there is a built in bias towards women buying cars. I am exactly the same way. When buying a car for myself, and the salesperson tries to speak to my spouse, as if I am not there, I tell the representative to look at me, and speak with me. Sometimes, the sales person seems surprised.
@@butterflygirl2285That doesn't make sense as men window shop the most.
@@butterflygirl2285😅
@@IaintTrynaGoOutLikeBIGnPAC It's because women tend to be more vulnerable in the dealerships.
Back in 2010, I was looking at purchasing a new Camry. The finance manager wanted me to finance through the dealership even though I was pre approved through my local credit union. He was very adamant that I financed through them. He said he would take 6,000 off the price of the car if I went with them. I agreed and he was smiling ear to ear. What he failed to realize is I knew there was no pre payment penalty so the next week, I paid the car in full.
I came in for an oil change soon after and he wouldn't even look at me. 😅😅
doesn't affect him in the least. probably didn't even recognize you. he's there just to get you in the finance office nothing more. and that tactic is well known
@dh5341 In the long run, you're right. It didn't make or break him financially but I'm just happy I got 6k off of the price of the car. 🤣
Dealerships get paid for all loans they place but only after six months. They make profits from the loans.
Hahahahahaha beautiful..
Last new car I purchased, I went into the Finance office, told them don't waste your time, I don't want anything other than the car and the manufacturers warranty I've got the money for the agreed upon price. They said ok, and that was it.
ask for out the door price. pay cash, say no to extras, get the keys and drive home. best yet is get everything done over the phone, and not expose yourself to dealers tricks and waste time on their tactics
thats what i do never even went to the dealership got the agreed price wired the money and they delivered to me im not going to waste my time at a dealership ive had no problems with selling my old one
Naw lease then buy after, new car rebates could save 4-8K
@@johnringo1145smarter
The only problem with this method is sometimes a test drive will seal the deal. We had a car and was keen on it until we took it for a test drive. Smell like a cigarette factory and the pictures didn't show any of the negative things. So I'm glad we didn't purchase the car.
Kimberly is the real deal. She answered my texts in real time when I was buying my brand new 2021 Toyota 4Runner TRD Pro in Lunar Rock and had questions during the finance stage. She helped me tremendously. 😊
Hardo
Excellent video thanks! Cars have become stupid expensive because they are overloaded with too much gimmicky crap we don't need. When a dealership looks more luxurious than a true 5-star resort, you know you're about to pay WAY too much for a piece of tin.
Excellent video. Thank you. So sad buying a car is such a battle.
Thank YOU @kenarthur6253 and yes - it's certainly can be a battle, for sure.
First new car deal I stupidly bought an extended warranty for like $3,000, went home and realized this was crap so went back and said I want to cancel this. Oh, they were pissed! Never forgot that. But in this video she talks about paying cash and how they hate it, In every other video they say never tell them you are paying cash until either everything has been settled, you get the out the door price, then at the last minute say you want to pay cash, or...just agree to their finance terms to get the best overall price of the car, then just pay off that loan in cash within a few weeks. Because if they know you will pay cash they won't negotiate the price of the car as much
💯 I go over that in a few of my other videos 👍
If you dont get an extended warranty from the manufacturer you are asking for big trouble down the line when the regular warranty expires. And if you get one on the cheap from a third party company, same thing, you are asking for trouble, because they will screw you when you make a claim. Mark my words and sell the car when the extended manufacturers warranty expirees. You cant imagine the costs of repair as the car ages. Electronics are huge and can run into the tens of thousands down the line. We got rid of our X3 when the extended warranty was going to expire. BMW wanted 13,000 dollars for one more year on the extended warranty. Shows you how much confidence they have in their cars. Really.
@@AutoFinanceSense Thats when they say, "Because I like you, I'll give it to you for $1500. (Actually happened to me.When I refused the extended warranty)
@@shepardsmith3235bruh you buy a new car to have for 20+ years. Selling it after the extended warranty ends would put you under thousands over the course of your lifetime. Treat your car good and it will treat you even better. Unfortunently old age on my 98 yoda finally having major issues so will be looking into another 😊
Never paid for a new car always bought vehicles that were used with low mileage, paid cash always. Learned a lot from watching this video. I actually enjoyed the fact that you were honest.
If you put $40-50k in to ticker ARCC, you would get a 10% return (taxed in 1099-DIV). Average auto loans are ~7% for good-to-great credit. The car is going to go down in value while the fund is going to stay relatively flat and pay yields. You've been making a financial mistake by buying cars cash.
The majority of people can't pay cash.
To live beyond what one makes is foolish , all my current vehicles were purchased 5,000 and up to 10,000. Saving money is easy when you work 40 hours plus, 7 days a week 365 days a year.
@@scottleggejryou are very wrong. For example i just bought a used lexus rx350 2021 with 38k miles for 29000. From which 10000 were coming from a credit card that will immediately give me around $1500 in points and have 0 apr for 18 months (could buy it fully cash though) The new car will always cost double from 3 years old with some mileage on it. Now, I don’t pay any interest, fees for financing and most of all pay $60 per month for the car insurance which saves me ton of money in the long term, compared to people who has to purchase full coverage.
You gotta be smart at it
@@viacheslavfedunov111 Nothing you said invalidated my point of interest/asset. Buying cars full cash, up-front is a bad financial move. As bad as carrying gap insurance imo. Let the bank carry the float of the depreciation until it has positive equity on the float and is a positive-cash asset - although it will still depreciate.
I bought a 2022 C8 Corvette that I was planning to pay cash for but when I looked at my investment returns I borrowed the money at 2.9 % and left my money in the investments to continue to make capital gains and dividends. Sometimes it pays to use someone else’s money !
You lost a lot of money on that vette. Ouch
@@jiggidyjamCorvettes are usually buy and holds. He is more than likely going to own it until he dies. Its a calculated loss as a result. Life's too short to drive boring cars for auto enthusiasts, its just something accepted.
I was going to pay cash for my Porsche but ended up using a private financier that specializes in exotics. There's a reason they put you on waiting lists for Porsche's GT products - they *REALLY* want you to go through their financing services and pay extreme markups.
In 2017 we bought a new Chevy Impala with a base price of $36500K GM offered a flat20% discount on the vehicle. We already had a valid approved quote from Navy Federal CU at 2.69% the dealer said that it would take a week to get a check from the CU 100 miles away location they offered a 2.79% offer from Chase.(for 72 Months) WE had told the F&I person that we intended to double pay the note and be done in 3 years. We absolutely refused any of the "special coverages" that he wanted to add to the deal. we ended up cutting a check for a down payment of $6K to the dealer and paid off the car loan in 21 months! .
Excellent!! @jamesclapp6940 💪 🙌
The Chevy even last that long? 😅
I put 6k down on a 15k vehicle. The finance manager told me I need gap insurance. I asked if he thought the vehicle wasn't worth 9k
What an @$$hole!
What did he say? XD
Selling GAP on this transaction would be unethical....
How does it go ? Because I’m about to do the same to a 17k vehicle
I put 6 grand down on a 30,000 4runner and he told l told me straight up that I would never need it. Then my wife totaled it and I got all my down payment back.
Solid info, and that comes from me being in the automotive retail industry for over 45 years. What I do, with dealers I am friendly with, is let them know I cam able to pay cash, but will agreed to finance. But in 120 days I will be paaying the note off in full. Then, I get the name and address of my finance company, and the account # of my loan. I pay off all but a litle more than three payments of the balance before I even get my first payment statement, so I am not paying interest on anything other than maybe a few hundred dollars. Then for the first three payments I pay the regular amount due, which will leave off the remaining balance. And for the fourth payment I pay off the balance. The interest $ I am charged is minimal, the dealer gets his finance reserve, and the F&I rep get whatever commission with no walk backs. The folks know I understand the game,a nd am eating a few dollars in interest in trying to keep their game in play. My approach sets a nice tone with these folks, but for the credit company likely not so much.
This explains why when I went to buy my last truck I found my own financing had a check in hand when I went to pick my truck up. When it came time to pay up I said I want the cash back option since I already have my financing done already. They left the room for a few minutes then came back in and told me that they would give me both the 2.9 financing and the cash back.
1.5 is better. They always try to get something out of consumers even a penny. 😂
All of this information is very helpful. After my car purchase in 2022, I eventually determined that I was ripped off. I successfully sold that car and purchased a new car using my credit union. They were so mad. There was so much drama with this transaction but I successfully walked away with the car without dealing with the finance department.
Never fall in love with a car at a dealer. You can find the same car somewhere else
The greatest negotiating power the consumer has is the power to leave.
💯💥
I call the salesman with a specific vin I want to lease/buy, tell them I don’t want additional products, do not agree to meet the finance manager, provide info up front so the paperwork is ready when I get there. Get ootd pricing on the phone. If buying, I arrange financing. I usually pay leases up front - saves money. Sign papers. Need keys in hand in 30 minutes and out the door. They don’t make much money however I don’t take up much of their time. Fair trade.
Walked into a dealer two weeks ago with paperwork (Carfax, consumer reports research, advertised list price, etc.) on a car they'd taken in trade, posted for sale, but hadn't quite finished prepping. Stopped at the gas station during an extended test drive, and was paid to fuel the car... all good, exactly as expected. I 'accidently' popped the hood to look at the engine compartment... all good. Said I'd be back the next day with my wife. 24 hours later, wife test drives... all good. Dealer then asked me to talk about monthly payments, and handed me their sheet with 7k in add on's. Took my pen, crossed out their add on's, circled the asking price (which was actually below my well researched expected cost)... said... cash or check? As predicted, finance manager was less than happy with me. Salesman however was impressed, and asked if I wanted to sell Toyota's.
ROFL.....good for you
Did you get any of the proverbial/ nominal fees waived ? Title , tax , doc fees , etc ?
@@crisrose521 A bunch, but not all. There's a mandated fee by the SC State Government, and sales tax which I'd researched, and didn't ask to have taken off. Everything else I had taken off the bill.
Salesman was just trying to impress you. He has NO authority.
I canceled an auto purchase from a dealership I had previously bought three new vehicles from when I found out they had marked up my buy rate. I expected the advertised top-tier rate because I had an excellent (820) credit score and they came back with a higher rate. The finance manager did a victory lap, pretending to be excited that he got me “approved“ just glossing over the fact that I had been approved for the top tier rate, and he had added on an extra 3%!
That was the sleaziest, most slimy, used car salesman BS I had ever encountered. What made it worse was that I never even imagined such deceptive practices.
I have never bought another thing from that dealership, in spite of me buying that auto brand exclusively for the past 20 years.
The first time I bought a car with my own financing secured ahead of time they pulled something similar. I agreed to let them run my credit and they came back with a “better rate.” The payment was higher than I had calculated with my already secured loan. As soon as I asked them about that, they yanked the paper work back and reworked it with my own funding. I never knew how they managed to arrive at that monthly payment.
Never have I ever heard of a 3% Mark up on the buy rate. One point or a point in a half. Maybe 2 I don’t think theirs any bank that lets you markup the rate that much. You’re playing with their money. It adds risk to the bank.
@@charlescuthbertson709 Honestly, it seems like it was more… but I do not remember the exact amount. What I do remember was them displaying a good APR for those with excellent credit, me having excellent credit, and them coming back in the room proud of themself that they got me approved, albeit at a higher rate reserved for those with ok credit. It didn’t add up so I immediately did some digging, and when I found that I had indeed been approved for the best rate and that they had lied and tacked on an additional percentage, I was livid. I walked out and never returned.
@@snowcrash4286they are car salesmen… they aren’t the brightest hunch. They only know sleezebag math. I make it a game with those bozos.
I made a deal on a Toyota once with the salesman. It was tough negotiating but we agreed and I told him that the agreed to price was every penny that I was going to leave in his dealership and I wouldn't even buy a Coke out of his vending machine and that he had better tell his finance guy that because if he starts dicking around I would walk.
Well the finance guy did try slipping something in and I got up from his desk and walked out and never went back.
He killed the deal because he thought he was so smart that he could slip one by me.
No. No sale.
I've been to 2 dealerships that will not sell a car unless it is financed through them. They don't care if you have a sack full of cash in hand. They insist on creating a loan.
Let them do the loan and then pay it off immediately. Just be sure to verify there isn't a pre-payment penalty in the paperwork you sign.
Run away.
I've gained plenty of knowledge between you and Car Edge Father/Son team......it's just trying to retain or recall it all whenever I get around to actually purchasing a new car!
put it on note cards and number them or color code them depending on the level the transaction is at...
Practice at a dealer(s) before you go to the actual dealer you want to buy from.
I may do this for my third and second choice actually. @@ForestToFarm
Write on a piece of paper and scratch off each item as it comes up. 😅😅😅
Former f&I guy. Ya she pretty accurate. The reason we hated hearing "cash deal" is bc it destroys averages on per deal gross and product penetration. I've lost thousands of commission dollars in my previous career from cash deals lowering my monthly % on my total numbers. You can always negotiate all products. Finance managers would rather sale at low profit then take a zero on numbers
I love these videos! I couldn’t give a sh!t what the finance manager hates hearing! I hate sitting in that room as they try shake me down for every useless option! My next car will be through a subscription I hope subscriptions kills the dealership! I bought a warranty for my last car. Whenever I bring my car in “it’s not under warranty” I ask for the manager & “the service manager put in the wrong code, of course it’s covered!” 🙄
I like the subscription model!
When they try to sell me an extended warranty, I tell them I buy right now when they give me a list of everything that ISN'T covered.
@@steverichdrummrdude, read what you wrote and try to make
Sense of it, because, I can’t!
What are you TRYING to say?
I bought a niche car where only 10,000 were sold for that model year. Because it was so unique I paid sticker price because the dealer would not have budged on the price anyway. In the finance office the guy tried to sell me on wheel protection and a extended warranty. I told him that I never buy extended warranties because if something is going to happen then it will happen during the warranty period, plus I been screwed in the past by warranty companies. I also told him that the savings of not buying an extended warranty over the last 20 years means I can afford to take a hit if I have to shell out a few thousand dollars on a repair and still be ahead. I handed over the check from the bank and it was a done deal.
Ummm 10,000 of a vehicle is a lot bro. That’s not rare and special. I have 1 vehicle that only has 500. Another one has 3000 made and 5000 on my 3rd vehicle. Not too many companies sell more than 10,000 of a vehicle. Somebody has fooled you with that number. Just think first example there were only 3000 2019 ZR1 corvettes made and it’s not considered a limited run. If your car is numbered with a plague it’s not special and even some are numbered and 2000 were made and they’re not considered special it’s just the manufacturer who tried to make it feel special to try and sell for more but it only has a sticker package that makes it different from their other exact model.
When I retired, I bought/ordered a new car as a retirement gift to myself. First, I sold (as always) my old car for thousands more, than the dealer would give me for it. Secondly, I am not afraid to walk out of the dealership. Third, the dealership offered a rebate, that had a requirement to finance through them. I checked the numbers and if I paid it off early I didn't get the lower price. Did my homework and put 1/3 down when I ordered it. And the last day, of the time stipulation, paid it off totally. Saved a few hundred there.
Great things to point out, but also all things that buyers wouldn't have to worry about if they were well educated and finance managers weren't crooks in disguise.
Thanks for this video. It's a shame that we have to go through life assuming that every person we buy something from is conniving to rip us off. I am not sure how as a society we arrived at this state.
And it is the learning disabled and those who have bigger issues going on in their life (like a family member in the hospital, or a recent death) who get ripped off the most, because they don't have the brain power or energy to defend themselves. I agree there is always room for better ethics.
dr, wrote, _"I am not sure how as a society we arrived at this state."_
The simple answer is 'capitalism'. People often bristle when I mention this but it's pretty obvious to anyone who dares to take a careful look at the point.
Prices are arbitrary. They're based on 'what the market will bear', rather than on anything remotely related to 'how much it costs to manufacture'. When people are doing well financially, it's the legal responsibility of corporations to maximize profits for their shareholders. Let that sink in: it's their **legal responsibility** to maximize profits.
So, the car may cost the same, but if everyone's swimming in disposable income, and willing to spend it, then corporations have a *legal responsibility* to 'game' for some of that money. Not because their product or service is 'worth' it, but because they're obligated to maximize profit.
In essence, a capitalism-based economy requires -- yes, it **requires** -- infinite growth. So as long as one lives and transacts in such a society, those on the selling end of the transaction will alway be looking for ways to extract the maximum amount of profit from the buyer. If this doesn't sit well with you, I understand that feeling. It doesn't sit well with me, either. But, that's how it goes.
Let the buyer beware.
@@tmo4330 Caveat emptor
Rule number 1 establish an out the door price before deciding on how your going to pay
*you're
@@danettewelborn5577 thanks dad
You are correct..then walk out with that price and shop it to other dealers and let them bid for your sale. I do it by email so only the winner will see me. They never get my phone number
@@danettewelborn5577Get a life.
@@bluelightguy1
😂👏
Excellent video breakdown of how F&I departments work at dealerships, Kimberly. You are 100% spot on!
I just go through the process, decline all the options. Then, circle back with my credit union which buys out the financing and I get a great rate. Currently paying just a bit more than my mortgage rate, 3% something.
I didn't even know you could cancel products like warranties after the fact, I thought it was part of the legal contract made at the time you signed docs and bought the car.
The best is always cash, but not everyone is in a position to do so. Best advice is to buy 1 to 3 year old - spend some time on the internet and you can find the exact car you want. The original buyer took the biggest depreciation hit. These days, dealers mark these up to about the price of new so you have to do your research which is easy today with the internet on the true market value. If you can find an individual seller vs dealer, will be way better for you. Plus, some states do not charge sales tax if you buy from an individual. Never pay for any of the add on’s they try to sell you at closing!! Repeat, NEVER! You don’t need them and it will be way cheaper to just pay for it if you damage a wheel or something. Great video and no need to be intimidated by the finance guy, they are just another car salesman and not as smart as they try to present themselves.
Gap I would buy depending on the situation but other than that yeah
#7 (late mofel used) they hate it when you say "NO" to buying an "EXTENDED WARRANTY"...even though the dealership WON'T HONOR that "extended warranty"!!!
Because they get a kick back for selling that warranty! About half the price to you.
Just as a general "rule of life" for me, personally, having lots of cash in savings is so much smarter than tying it up in a vehicle. I'm solidly middle class, and I don't know too many people who have at least $5k-$10k cash, in savings, for emergencies. Once you sink that much cash into a vehicle, you obviously lose the liquidity and you'll probably not get it all back if/when you sell the vehicle down the road.
I was buying a car. They offered me 18% interest. I said I am paying cash. She told me I would be better off investing that money. I said earning 18% long term after income tax isn't reasonable. She pretended not to understand that concept. I bought private.
Best advice ever for new car buyers. Kimberly is the real deal and a must follow.
The most important thing I’ve learned after spending countless hours at a dealer with them trying every trick in the book they have to rip me off is never give them your license or keys. You’ll be held hostage until you’re worn down to the point you’ll sign anything they put in front of you. The last time that happened to me I told the sales person either give me back my stuff or I’m calling 911. Amazing how my stuff reappeared.
My seven things that I know are: the invoice price, dealer holdback, whether the dealer floorplans or not (almost always yes), the residuals at 36/39/48 months, the lease factor, how long the dealer has had the vehicle in inventory, and my state doc fees. I have a little folded piece of paper I consult in my pocket that they see me reading but can't see what's on it. Drives the sales people crazy. Another thing the dealer absolutely despises is when I'm walking out or terminate an e-mail exchange because of an inflated price, BS or both, I say bluntly "I can't afford this vehicle." Emphasis is not on afford but rather THIS VEHICLE! "I'm not going to waste any more of my or YOUR valuable time." What are the first words out of a dealer's mouth -- what if we could lower your payment or we have this other vehicle which is cheaper.
Hey Kimberly, I recognized you from car edge and am very grateful for the clear and concise information you’re sharing. I’m getting ready to buy a new yo me vehicle and there’s been so much I didn’t know before starting my binging of informative videos such as yours. Much appreciated and love from AZ :)
I just recently bought a car. I have bought 3 cars through Capital One. When I went in I say I will purchase a car through Capital One and no one else. They wanted me to go with someone else, they were like Get a better rate. I know Capital One and they are awesome. When I finally get to the finance manager he was trying to sell me a warranty. I got it and realize when I ask how do I use the warranty. He was hemming and hawing. He wouldn’t cancel it. I called the warranty company myself to cancel. When you already have approval from the bank and you are not desperate
Ask from finance folks: what is the buyer and seller rate? You will see their spirit leaving their bodies. As newcomer to this country. I used Kimberly tactics and avoid getting 18% interest rate. They told me I would never get anything lower than that as I had no credit history. Went to my credit union, got a 9% offer, instead. For new people coming to this great country, sometimes it’s not that easy to simple say no, but one must learn the tricks to reduce massive loss.
Having owned a two car lots, never had a F&I person. Wish I had one because I hated the finance part just like my customers.
For the last 20 years or so I have always paid cash. I dont tell them I'm a cash buyer until I'm sitting at the F&I table. Only then I tell them lets cut to the chase, I'm not interested in buy and sell rate markups I am a cash buyer, give me your best deal. Usually at this point the sales manager comes in. Grant it, I usually do buy the platinum extended warranty as well as the tire warranty (Ive had 3 $300 tires replaced this year so far at zero cost). In the past they have tried had to push 0% finanicing saying use their money, not mine lol. No thanks. Your video is very informative and spot on!
No pre payment penalty means that you can pay the loan off the next day if you wish and there is NO penalty to the borrower.
You can’t typically pay off your loan the next day because your account hasn’t been set up with the lender. This can take up to 2weeks to 30 days.
Are there any loan companies that have this, seems illegal.
@@Leslie83249 how that seem illegal? Some dealers send paper contracts to the lender. It takes time for the lender to receive and process the paperwork and set up an account and mail a statement If you looking to payoff a loan that fast you probably shouldn’t be taking out a loan.or didn’t need to.
@@thegerm574 stealerships are being greedy and its much worse since the pandemic. At one point, dealers were turning away cash buyers (I don't if this has changed since I hear no one is buying and they are getting desperate) forcing customers into loans.
@@thegerm574 I think that most judges or legal entities would view a contract that states "no pre payment penalty" as just that....unless there was language in the contract saying you cannot pre pay for the first 2 weeks or 30 days while administrative work was being done. If a borrower could show the judge that they were willing, able and wanting to pay the loan off right away on a contract that simply states no pre payment penalty then the borrower would be awarded back any interest or fees charged.
Just found your channel. I can't express enough how much I appreciate this video. This knowledge is really going to come in handy. I subscribed and saved this video to my VEHICLES playlist 😁
Me too
Just to add to the "phone a friend" part. Make sure you let the friend know ahead of time that you might call for advice and around what time you might be calling. Don't just cold call someone and put them on the spot when you're looking for important financial advice.
Thanks, going tomorrow to buy a used car. Not looking forward to it at all. I hate sales BS. I smell it a mile away. My statement on financing is usually, "As a member of X Credit Union, I would give you an opportunity to beat their rate, AFTER we talk price." This helped me prep.
I have NEVER seen a offered "product" in the F&I office that was a true useful and fairly priced advantage to a consumer.
Here In Louisiana our roads are horrible, so the tire, wheel and key fob protection plan is well worth it when they repair or replace your tires and wheels for 5 years unlimited miles
Depends some are worth it..
I bought a new Ridgeline in May. I had a low mileage trade, $10k down and my credit score was 805. I knew what I wanted to pay. Got it for $2k under invoice and $11k for the old car
My ex-girlfriend came to me really excited about getting a new Nissan Altima. She was trading in her used Honda Accord, and thought she got an amazing lease offer. It was only $349 a month or something like that. Looking over the paperwork, I saw that they subtracted the value of her trade-in from the price of the car BEFORE dividing it in half for the lease computation. In other words, the dealership STOLE half of her trade-in value. I went back to the dealership, put the entire value of the trade-in on her half of the lease, and the payment was less than $190 a month. The sales guys looked like they wanted to kill me. Then I broke up with her. On her birthday. Not a great boyfriend, only a great negotiator.
No way why would you trade a Honda for a Nissan
Alpha!
@@MrMOd3RnW4rF4R3 that's why he broke up with her 🤣
Absolutely agree Kimberly on pitting one dealer against other on cost of products. 4 months ago purchased 2023 Hyundai sonata limited CPO with cash only. The selling dealership price for a 10 year wrap VSC was $1900. They originally wanted $2900. But i used car edge vsc against them. Once i was back home in Tennessee. I purchased car in PA due to so many Hyundai dealerships near me played games with OTD price. So im F & I manger of dealership near me. He says $1700 for same VSC. Immediately call the F&I i purchased the VSC from and put him on speaker phone. After back forth got it down to $1450 from dealership i purchased. Dealership i was in only down to $1578. Yes i was well within 60 days to void. So saved $450 by using this technique. Thanks again Kimberly for all you do.🎉 Frank from TENNESSEE
❤Thank you Kimberly for educating us on financing! I'm a "BIG FAN" of your videos! Can't wait for the next one !
Thank you so much for being here! @bwolfe2022
Being able to buy in cash or have a loan already in place saves so much time !
I've found in the past (I always lease my vehicles, since 2001) that dealers add "port installed" options like mud guards and roof racks that I don't want and when I tell them I won't pay for it, they say you have to, it's on the car already. I'll be more aggressive when I order my 2024 crossover, as unlike 2021 (pandemic), I will have a choice of vehicles and manufacturers this time! Also, my husband always accompanies me to the dealership; he's a CFO and has a MBA in Accounting and Finance, so I trust his knowledge and math skills. He can also add big numbers in his head and works with multi-million dollar budgets, so he knows a thing or two about wasteful costs and bloated profits.
In the southeast, certain dealers are adding options at the port so they go on to the monroney label (sticker) on their lot. It's sneaky!! Sounds like you're on the right track 👍
"When I tell them I won't pay for it, they say you have to, it's on the car already."
If you fall for that line, you lost the negotiation. You don't HAVE to pay for any of their dealer add on crap. The "it's already on the car" thing might be true in some cases, but it's a negotiation tactic all the same.
I have told a Porsche dealership that I won't buy the car at all unless they take off the stupid "anti-theft" device they added. They wanted $1200 for it, and of course the car already has a factory alarm. I'm pretty damn sure an installation tech comes around to their dealership on a weekly basis, puts one on every car they have on the lot, and charges them $45 each. I made them call the tech, make a special trip to the dealership, and remove it in my presence. It was under the hood and simply unplugged...no wires cut. Also declined all the other crap they tried to push.
I have told a Honda dealership that I won't buy the wheel lug locks, and in fact I won't buy the car with them in place. They argued they had already spent $380 adding them to the car. I walked back to their parts department and found out a set of them was $19. They put the standard issue lug nuts back on in my presence and it took them six minutes. $380 my ass. Also declined all the other crap they tried to push. One of the items was pen stripes, which they said were hand painted by a specialist. Really? The exact same stripes are on the car pictured on the Honda USA website, and they are clearly stickers that are under the factory clear coat. They wanted $250 for those. $250 my ass. They didn't even do anything for those except make up their pen stripe paint specialist story.
I've been doing this for years. Never owning less than eight cars at any one time, and NEVER pay for ANY of that crap. Yeah, it's an annoying negotiation fight, but it's worth it. Actually I've gotten used to it, and it's kinda fun to see what bullshit argument they'll come up with next to support the outrageous prices they ask for those things.
It's best not to bring any of this up until after you've spent a couple hours at the dealership. Test driving, making the salesman tell you all about the car, letting them bring you cokes or whatever. Don't bring it up until the final moments of negotiations. This way they've invested a fair amount of time on you and got their hopes up. And if they let you walk out it's all wasted.
I’m 67 and I buy my (still under warranty) used Volvo from sellers, not dealerships. Never knew they add on junk. I use my credit union to make a $300/ mo payment.
Another useful video. Despite all I have learned from car edge and you, and the fact that the prices are finally coming down to a more sensible point, I’m still staying out of the market because I’m saving somewhere in the neighborhood of $8400 a year by not buying a car. That makes it really hard to pull the trigger.
I’m of the same mindset as you. I couldn’t agree more. I just think of all that money I got retain every month that passes by with no car payment. I then dump it into more stocks instead and smile into the next month.
This made a lot of sense and I practice a lot of what you said. They get mad when you know a lot and they can’t get their way
Car Edge is a business model to sell prenegotiated deals at a profit, as well as finance products. Zack understands how social media can influence people.
That is why he pushes all that stuff so hard. Ray knows the money is made in the F&I office, so Zach is trying to be the F&I office without having to sell cars. At best, most of these products are about covering up that people are massively upside down and overleveraged in the car loan. The rest are just flat-out scams.
I have more of a problem that Zachs dad used to be a car sales manager and have probably pulled the same tricks on others. Now that he's done, he's telling us some of the tricks.
@@bad_vaporizer Whats wrong with that? I'd rather they snitch on the industry than continue to support sheisters.
@BDBD16 the problem is that now that he's had his fill he's now using the knowledge to help monetize what he can for his son. To each their own. I'll get my info elsewhere but you do what makes you happy sir.
The homework guy is my go-to!
Most dealerships sell reputable warranties. I am a technician, parts are outrageous and labor is no joke! We sell policies that cover your vehicle bumper to bumper for 10 years or 100,000 miles. Your extended warranty will pay for itself the first time you need it. Especially when your radio head unit is five thousand dollars, not including labor. I can repair my own vehicles, but purchase extended warranties to cover part costs. If I never use it, great - just like my car insurance. If my transmission fails, I just saved twelve thousand dollars.
That was my view with my additional warranty - it’s an insurance policy just like any other insurance policy, and it was worth it to me, even though I never used it.
Which policy would you recommend.
You do not sell warrantees. You sell extended service contracts.
There are no "bumper to bumper" extended service contracts.
The only reputable extended service contracts are those offered by the manufacturer. All third party ESCs are dubious at best and scams at worst.
If your transmission failed, you did not save $12,000. You must reduce that savings by the coast of the ESC plus any lost opportunity costs which you would have received had you invested the amount of the ESC.
If your transmission fails, that ESC might pay for the repair. But it is far more likely there will be some loophole which the provider of the ESC will use to deny the claim. The devil is always in the small print.
Know the out the door price. Dont pay for taxable addons. Pay cash and if all else fails walk.
Useful video for my approaching “battle” scenario in the next couple weeks with BMW. Forwarded is forarmed.
can you talk about the 4-way sheet? and how evil it is.
I think they hate it most when I say this is too much trouble. I'm just going to the dealership down the street. Thanks for your time.
Everyone needs to know this stuff. Well done.
I got 10k of a new Cherokee in 2019 because they had the feature list on the window. I got on jeeps site did - build - plugged it all in and showed it to them and said, so why should I buy this here instead of just ordering it direct? They changed the price for me to match what the site said it should be
dealerships don't sell cars they are loan originators. show me an extended warranty that extends the manufacturers warranty....you can't. if you think you need more warranty wait until the manuf warranty is near the end. they're going to send you offers in the mail
Just bought a Hyundai 2 weeks ago with 0% financing. Not sure if the finance manager was overbooked for the day or short staffed but he rushed right through everything and did not push for any additional products. I was prepared to say no no no, but didn’t even get the opportunity. Lol
It’s a Hyundai… they’re just happy to make a sale!
Which hyundai dealership that is offering 0% financing? And does it apply to all hyundai vehicles?
@@vincentvanderbilt5598 it was a manufacturers promotion during the month of December.
Of all the cars available and you choose a Hyundai ? 🤣 you got hosed no matter what you paid for it
@@NickChemist-yf6oj it’s my 3rd Hyundai in 30 years. Buy a new one every ten years when the old hits 150k plus miles. Until they give me a reason not to buy them, I’ll keep coming back. Started with an Accent, then a Sonata and now a Santa Fe.
NEVER say "I'm paying cash! to a Finance Manager OR car salesman!!!
Until the very end.
Why
@@oshynclair7592I want to know this also bru
Don't buy a product if you're not 100% certain you want it.
I had a situation where I bought a warranty because I was exhausted and wanted to get out of the finance office, and I could not get the F&I guy to return my call. Eventually I had to call the warranty company to cancel.
Also, NEVER tell the dealer how you will pay for a car UNTIL you come to an agreement.
Yeah...saying you're calling a friend for advice is great...this will sicken them. Also...be in NO hurry...they hate when you are like "let me think about it overnight" - LOL
I've had sales people say stuff like 'someone else is interested, so it might be sold if you don't jump on it now' - I always advise them to go ahead and sell it then, because I can find another car LOL - They HATE that - They want you to be emotionally invested in the vehicle, or really need to buy soon.
Best to be indifferent to the vehicle, and especially to buying ANYTHING...'just thinking about it' - Now YOU'RE in the driving seat - if you love the vehicle, THEY are driving the deal
I have used all of those myself. I am in no hurry to buy today. I’ve got all the Time in the world. I don’t know. I don’t really care for the color but maybe I could live with it. I don’t know if it’s gonna fit in my garage. They always say to someone else is interested. I always tell great sell it to them and then they default on the payments called me. They hate that.
Thanks!
Thank you so much! @e.y.3336 💥
After all the bad experiences I've had with different car brands and dealers, I don't care what "deal" they're offering, I'm paying as much cash as I'm comfortable with and getting a loan for the balance from my credit union. The less I deal with anyone at a car dealership, the better; they are vastly more experienced at having an advantage over the average, only once-every-so-many-years buyer.
Spot on! if you finance it just say NO to all add-ons. No matter how hard the fiance manager tries.
I don’t say cash,I tell them “ What do you think?,and then just play around with them for a little before i say yes.
Thank you, I’m about to buy two used cars in the next two weeks! I forgot about asking out the door, before telling them you are paying cash!
If you have the cash, why not take the loan and then pay off a finance loan before the first payment is due?
Because once you sign there are usually penalties for early pay off. Read the fine print.
Thanks a million! I’ve been scammed many times at car dealers for lack of knowledge. 🙏🙏🙏
THANK YOU SO MUCH. Among all the videos I've been watching this one has bridged the gap the most effectively and efficiently. You provide the timing the terminology and the rationale behind the finance manager and us as the consumer. This has honestly been one of the most valuable videos I've watched on car buying thanks to the simple but industry standard terminology being condensed into the one video.
Thank YOU so much! @makaeo8085 That means so very much to me! 🙏 I think it was my first video where I said, I realize dealership finance is far from an exciting topic but that hopefully I can simply help people understand the process and save them some money. Thank you again for being here and your kind words.
I do buy extended warranty and servicing because in the past it has served me well. On a $51K car, it came to around $3,500 combined (Toyota) and given how sophisticated the mechanics are (it's a hybrid PHEV) you are at risk of severe out-of-warranty bills. In the past it has served me well, but be aware that in many cases you can bargain-down the price. These days I pay cash, always, but in the past, when I was poor, I used my Credit Union as they offered the best rates. I hate going to dealers, but as I tend to buy rather exotic (aka halo) cars or unusual models (Rav4 Prime), I consider it a win if I buy at sticker price. My goal, buying a car, is to be in-and-out within two hours, everything signed, with the car ready for pickup in the afternoon or next day. My overriding advice to all car buyers is this: be entirely ready to walk out if it isn't going your way 100%.
I normally lease my vehicles & GAP is automatically included. Dealers not make to much on leases. Only downfall no more $0 down $199 lease deals on Civic, Corolla etc. like they use to have & you need to put hefty down payment to get that price & not worth it.
I paid cash for my last 2 vehicles. It was the most "unfriendly" back and forth with the finance manager. Another dealership that I will never go back to got angry when I said I was going to shop around. He refused to put his offer in writing saying, "I'm not going to give you something to take to another dealership and compare."