I can help, I manage a car dealership.

[UpNComing]

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@Revelate wrote:

 

Sometimes it does depending where you live.  A friend of a friend has the same position as you in a Mercedes dealership out here (Los Angeles, in one of the upscale neighborhoods), and they have various B-D list celeberties coming through all the time throwing cash at vehicles... the same can't be said for the random Honda dealership in the suburbs.

Webhopper: I'm going to catch some flak for this one, but also consider financing the car, and then writing the check to the lender and you may be out less money.  That said, relationship building with a dealer is a two-way street, there are certain expectations you're going to have to meet to keep your end of the bargain and this might not be it.

That said if I were you, think I'd absolutely finance the vehicle depending on the rate you're getting vs. what cash / financing requirements you have to continue pushing your real-estate investing forward if you're still planning on continuing to building your portfolio there.  Rates are ridiculously low now and may not be again for decades depending which way the economy goes.

Actually, if I were you again, if I didn't have an immediate investment opportunity, I think I'd take it one step further knowing what I do now: get the financing, and just make way more than the minimum payments if the lender counts them towards future payments.  Knock the principal down quickly and let the tradeline idle, getting most of the FICO benefits to having a mid-term seasoned tradeline, and also not costing much out of pocket in interest charges.  YMMV by lender but most simple-interest installment loans I'm seeing seem to do this by default.

Depending what my income is come April 1st, I may just keep the 19.35% Wells Fargo DS loan that I have, and just continue throwing my free cash flow towards crushing the balance as I could pay it off in under a year if I so chose at my current rate, and then just do what I suggested in the preceding paragraph without going through the hassle of re-financing games in my case.

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Thats actually good advice Revelate.  I often encourage customers to finance to help them get a better deal.  Letting the dealer finance your loan sweetens the pot a little.  Gives the dealer a reason to reach a little deaper on the price to make the deal.  Then just pay it off once you receive the first invoice.

[webhopper]

Are there loan origination fees and whatnot which would make it more expensive? I don't remember..

[UpNComing]

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@webhopper wrote:
Are there loan origination fees and whatnot which would make it more expensive? I don't remember..

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Not in NJ.  Not on auto loans at least.

[drkaje]

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@UpNComing wrote:

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@drkaje wrote:
What's an "Offer you can't refuse" price on a new Jetta with manual transmission? II'd love one of the diesel ones but have heard they're a lot more.

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Which trim level?

S, SE, SE Convenience, SE Convenience Sunroof or SEL?

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SE.

Heated seats are tough to beat, LOL!

I'll have to buy something in a few months so it'll really be a toss-up between a Jetta or Civic.

[UpNComing]

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@drkaje wrote:

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@UpNComing wrote:

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@drkaje wrote:
What's an "Offer you can't refuse" price on a new Jetta with manual transmission? II'd love one of the diesel ones but have heard they're a lot more.

---

Which trim level?

S, SE, SE Convenience, SE Convenience Sunroof or SEL?

---

SE.

Heated seats are tough to beat, LOL!

I'll have to buy something in a few months so it'll really be a toss-up between a Jetta or Civic.

---

$19535 MSRP is $18296 at dealer cost minus any applicaple rebates.  Of which there are none for cash or finance after today.  Any dealer I know would take next to no profit on a new Jetta.

[drkaje]

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@UpNComing wrote:

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@drkaje wrote:

---

@UpNComing wrote:

---

@drkaje wrote:
What's an "Offer you can't refuse" price on a new Jetta with manual transmission? II'd love one of the diesel ones but have heard they're a lot more.

---

Which trim level?

S, SE, SE Convenience, SE Convenience Sunroof or SEL?

---

SE.

Heated seats are tough to beat, LOL!

I'll have to buy something in a few months so it'll really be a toss-up between a Jetta or Civic.

---

$19535 MSRP is $18296 at dealer cost minus any applicaple rebates.  Of which there are none for cash or finance after today.  Any dealer I know would take next to no profit on a new Jetta.

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Thank you!!

[Revelate]

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@UpNComing wrote:

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@Revelate wrote:

 <snip>

Webhopper: I'm going to catch some flak for this one, but also consider financing the car, and then writing the check to the lender and you may be out less money.  That said, relationship building with a dealer is a two-way street, there are certain expectations you're going to have to meet to keep your end of the bargain and this might not be it.

<snip>

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Thats actually good advice Revelate.  I often encourage customers to finance to help them get a better deal.  Letting the dealer finance your loan sweetens the pot a little.  Gives the dealer a reason to reach a little deaper on the price to make the deal.  Then just pay it off once you receive the first invoice.

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This thread turned out to be a lot more interesting than I was expecting .

It may be good financial advice, but how do you consider it, not as an individual, but as a Sales Manager for a dealership for customers which do this?

I agree with your point earlier: salesmen turn over all the time at dealerships, and even one's requirements for cars change over time as well and they may not be able to offer what you're looking for anyway... especially if talking about someone who tends to drive 10ish years anyway on each vehicle; however, when dealers take something off the price in expectation of making something off financing (like the Acura dealership I purchased at did, almost assuredly looking at what I paid vs. blue book value), and then having the customer turn around and write a check for the full balance, is that generally frowned upon?

Or calling it what it is, does having the mfg hold-back (at least on a new car) during most of the year cover enough of your marker as a dealership to not worry about the occasional person that does that considering that number of vehicles sold per prior year affects how many you get the following (I think)?

[Revelate]

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@UpNComing wrote:

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@webhopper wrote:
Are there loan origination fees and whatnot which would make it more expensive? I don't remember..

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Not in NJ.  Not on auto loans at least.

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Don't most auto lenders just roll this into the APR on some fractional basis?  Haven't seen that in TX or CA either.  May ask someone where I work (financing arm of a major auto manufacturer) if we charge origination fees anywhere, though I suspect that we probably do not.

[UpNComing]

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@Revelate wrote:

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@UpNComing wrote:

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@webhopper wrote:
Are there loan origination fees and whatnot which would make it more expensive? I don't remember..

---

Not in NJ.  Not on auto loans at least.

---

Don't most auto lenders just roll this into the APR on some fractional basis?  Haven't seen that in TX or CA either.  May ask someone where I work (financing arm of a major auto manufacturer) if we charge origination fees anywhere, though I suspect that we probably do not.

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Oh they have fees.  I don't have any knowledge whether they internally roll the fees into their APR.  Mostly the dealer pays these fees.  NJ law prohibits us from passing any of these fees to the customer.  Dealers can however adjust the price of a vehicle to recoup any losses.  Depending on the lender and customers credit some aquisition fees can get outrageous.  Subprime lenders can be thousands.

[webhopper]

Do dealerships get "dinged" by the lenders for non-performing or under-performing loans that they originate?

An example of non-performing would be a repo...   an example of under-performing would be, The guy pays the car off early or pays extra, so the lender doesn't get to make back the amount of profit he anticipated by lending the money.  

I was just wondering because I read through Fannie Mae's buying and selling guide for mortgages, and Fannie Mae definately frowns when people default early on a Fannie Mae backed mortgage as well as a Fannie Mae Underperforming mortgage... In fact, it leads to an investigation of the originator by Fannie Mae. I guess I'm wondering if the same is true for Auto Loans?