Last post on Nov 20, 2013 at 9:45 AM
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Car Buying, Car Selling
#3148 of 3350 loan interest rates
Mar 02, 2013 (3:08 pm)
Bought a car and the finance manager contacted a couple of banks for rates.
I've heard the dealer can make some money on these loans by marking up the rate.
Is their profit a fee or it it paid for over time?
#3149 of 3350 Re: loan interest rates [explorerx4]
by kyfdx@Edmunds HOST
Mar 02, 2013 (8:32 pm)
Usually, the bank will pay them a fee upfront for writing a loan above the wholesale rate. If the loan is paid off before a specified period of time (90 days, usually), there will be a charge back (the dealer won't get paid).
How much is it? It's usually the whole extra amount, discounted for present value. As an example, BMWFS pays a BMW dealer 70% of the extra amount over the "buy rate".
#3150 of 3350 Re: loan interest rates [kyfdx]
Mar 03, 2013 (6:01 am)
Thanks, exactly what I wanted to know!
The finance manager pulled a bit of a fast one on me, so I'll refinance with another lender after I make my first payment.
#3151 of 3350 Help Please: Fees and Negotiating a Price
Mar 04, 2013 (5:19 pm)
I need to buy a used car as soon as possible. I can't really afford to spend anymore than $3000 on the car itself. I've researched a few options and came across two Nissan Sentras that are both available at the same used car dealership. One is a 2001 Nissan Sentra with about 150,000 miles, the other is a 2003 Nissan Sentra with about 130,000 miles (although it is bright yellow in color and I would prefer something not so flashy). They are both priced at $2995. I checked the VIN for both and they both come up clean with no accidents or any red flags. My concern is the final cost with tax included. The sales tax rate in Illinois is 8.75% which would mean the final cost of the car would be about $3270 or so which is more than I want to spend. (I know $270 doesn't seem like a big deal, but that would be pushing it for me right now). If I could get either car for $2800 then that would put me at about $3045 total, which I would be happy with. My question is, how should I negotiate to see about getting the car for $3000 total or less? What price should I start with? Should I tell them my limit up front? Also I know there are other fees that I have to take care of at the DMV, but are there any other fees normally at a used car dealership other than the sales tax? I will be paying in cash.
P.S. I will also be paying a mechanic to do an inspection on both cars which I know will run me at least another $100. The mechanic's fees along with the DMV fees are exactly why I don't want to spend more than $3000 on the car itself.
#3152 of 3350 Re: Help Please: Fees and Negotiating a Price [nadia21]
Mar 04, 2013 (5:31 pm)
I'd start with an offer slightly lower than your limit so $2400 or $2500. See if they counter offer at a lower number and if you have to go up, go up in small increments only, and be firm with those numbers. From $2500 go up to $2600 and be firm. If they are responding to your offers then that means they have room to move. If they are not then they might be firm on the price. You might get a better deal on the yellow one as that's not an easy color to sell. Also if both cars had a regular price of something like $3499 or $3999 and $2995 is the sale price then it might be hard getting it down any lower. But doesn't hurt to ask or try.
Now even if they lower the price down to $2800 very quickly and you're say at $2650, see if you can get it down a little bit lower. Hit them back at $2700 or $2725 and say that's your bottom line. You might even be able to get it for below your limit.
When you agree on the price make sure you have a "subject to your mechanical inspection" clause in there. Make sure the dealer is ok with giving you the car for a few hours so that you can get it inspected. I would ask for this ahead of negotiations.
#3153 of 3350 Re: Help Please: Fees and Negotiating a Price [boomchek]
Mar 04, 2013 (6:48 pm)
Thank you so much! Are there any other fees at the dealership that I should expect?
#3154 of 3350 Re: Help Please: Fees and Negotiating a Price [nadia21]
Mar 05, 2013 (1:44 pm)
No, if you're just buying for cash there will be the documentation fee as you mentioned but there shouldn't be anything else.
#3155 of 3350 Re: Help Please: Fees and Negotiating a Price [boomchek]
Mar 05, 2013 (2:31 pm)
#3156 of 3350 Seashells...not by the seashore
Mar 13, 2013 (4:10 pm)
Could anyone give a logical explanation as to why my wife and I saw small seashells on top of the engine cover on a used (certified) Jeep Compass in the middle of Maine? Our first thought was is this a Superstorm Sandy vehicle? Needless to say...we walked away and won't be going back. We didn't even bother to look at the Carfax, but it is still really bothering me someone wanted to sell this to us. Seashells? Come on. At least clean off the seashells!
#3157 of 3350 Re: Seashells...not by the seashore [clutch13]
by Kirstie@Edmunds HOST
Mar 14, 2013 (7:58 am)
Well, it's probably good that they didn't bother to clean off the seashells - otherwise, you might never have known. The Jeep could have been previously owned by someone who did live near the sea. In addition to the storm possibility you mentioned, it could also be that the previous owner, for whatever reason, did some off-roading on the beach.