can a car dealer add thousands to a car because you want finance

ciarawira

went into a dealership today and the pirce on the car was 9995.As i still have finance on my current car about 5G and want to trade it in against the new one i was told that price is for cash only and if i wanted it on finance the would have to sell it for over 11G (thats not the interest)!!! can they really do this ? thought it was a bit of a joke tbh!!

Jimbob 83

Finance is robbery, Credit Union loans are the way to go for buying a car in my experience.

I have been lobbing in 20e every 2nd week for a year or so since i paid off my last loan and i can waltz in and get a 10,000 car loan in a heartbeat.

Think ahead and save a packet.

ciarawira

Jimbob 83 wrote: »

Finance is robbery, Credit Union loans are the way to go for buying a car in my experience.

I have been lobbing in 20e every 2nd week for a year or so since i paid off my last loan and i can waltz in and get a 10,000 car loan in a heartbeat.

Think ahead and save a packet.

i know , but as i have outstanding finance i just wanted to top it up as i need to change my current car! i just thought the sticker price didnt go up because i want it on finance i would end up paying 11500 + finance when it should be 9995+ finance

Anan1

ciarawira wrote: »

went into a dealership today and the pirce on the car was 8995.As i still have finance on my current car about 5G and want to trade it in against the new one i was told that price is for cash only and if i wanted it on finance the would have to sell it for over 11G (thats not the interest)!!! can they really do this ? thought it was a bit of a joke tbh!!

You misunderstood. A 'cash price' doesn't mean no finance, it means no trade-in. You can buy the car on finance for €8995, but only without a trade-in. Conversely, the price of the car will be higher with a trade-in even without finance. It's all smoke and mirrors anyway, they raise the value of both the car they're selling and your trade-in in order to make you feel like you're getting more for your own car. As always, the only figure that matters is the cost to change. If anything, taking finance from the garage should bring the price down a bit as they're making a profit on the finance too.

Guy:Incognito

He can add thousands to the price for any or no reason he likes it's his car to sell as he wishes.


In this instance though, as Anan says, a cash price is no trade in.

colm_mcm

In this case your car is probably worth less than the finance so they increase the invoice value of both cars ?

ciarawira

Anan1 wrote: »

You misunderstood. A 'cash price' doesn't mean no finance, it means no trade-in. You can buy the car on finance for €8995, but only without a trade-in. Conversely, the price of the car will be higher with a trade-in even without finance. It's all smoke and mirrors anyway, they raise the value of both the car they're selling and your trade-in in order to make you feel like you're getting more for your own car. As always, the only figure that matters is the cost to change. If anything, taking finance from the garage should bring the price down a bit as they're making a profit on the finance too.

i understand and thats all well and good only it was never stated on the site or on the car that it was 'cash price'!

colm_mcm

What's the model/year of the trade in?

drunkmonkey

It's about 3 Grand in negative equity what ever it is.

That's what's getting aded to the cash price. It's cash price + how much in the minus the trade in is.

ciarawira

colm_mcm wrote: »

What's the model/year of the trade in?

its an opel vecta 06 petrol and looking at vauxhall vectra 08 diesel

ciarawira

drunkmonkey wrote: »

It's about 3 Grand in negative equity what ever it is.

That's what's getting aded to the cash price. It's cash price + how much in the minus the trade in is.

sorry but i dont understand

colm_mcm

Did they give you a cost to change?

drunkmonkey

You cars worth about 2.5/3 grand in the trade, so that's why the price of the newer car has gone up by 2 grand as the finance needs to be balanced to make up the shortfall on the 5 you owe.
If your car was worth 5 as a trade in you could pay the sticker cash price.

Cash is the first currency and that's what most cars are advertised as unless stated otherwise.

ciarawira

drunkmonkey wrote: »

You cars worth about 2.5/3 grand in the trade, so that's why the price of the newer car has gone up by 2 grand as the finance needs to be balanced to make up the shortfall on the 5 you owe.
If your car was worth 5 as a trade in you could pay the sticker cash price.

Cash is the first currency and that's what most cars are advertised as unless stated otherwise.

i was offered 5 grand for my car so i still dont understand ! And should it not be stated as cash price ?

ciarawira

colm_mcm wrote: »

Did they give you a cost to change?

no

drunkmonkey

ciarawira wrote: »

i was offered 5 grand for my car so i still dont understand ! And should it not be stated as cash price ?

He was trying to make you feel better. You'd be insulted if he'd only offered €3,000 which is roughly the trade price of the car.
If you actually went in with cash you bring the car home for a little over €8000.

ciarawira

drunkmonkey wrote: »

He was trying to make you feel better. You'd be insulted if he'd only offered €3,000 which is roughly the trade price of the car.
If you actually went in with cash you bring the car home for a little over €8000.

why would he offer me 5 to "make me feel better"? thats absurd id only be insulted if it was a false quote!

drunkmonkey

ciarawira wrote: »

why would he offer me 5 to "make me feel better"? thats absurd id only be insulted if it was a false quote!

It doesn't matter what way he words the offer it's all the same unless you put in 2k cash into the deal.

Your car is worth 3k
The car you want is 9k
You owe 5k already.

So the the price you'll pay is the 9k cash price + 2k the garage has to add to the price to clear the finance owing on your car. That 2K is going on top of the finance for the 9k.
Your not bumping up your existing loan, you're clearing it off and getting a new loan for 11k (That's made up of 9k car and 2k in the finance you owe).

bazz26

Take the financing out of the equation for a moment and concentrate on the two cars.

The figure you need to focus on is how much money the garage want from you with your old car to buy the newer car. This is known as the cost to change price. Sticker prices and trade-in prices can be masked to appear favourable to you. So once you have your cost to change price you then add the 5k outstanding finance from your old onto that figure and that is the new figure that you are financing. This clears the finance on the old car.

On a side note, going down this route is not the best idea imo as all you are doing is paying more interest on a previous borrowed amount that would have already included interest.

CharlieCroker

The finance outstanding IS the reason the dealer is doing this. As stated, to the trade your car is worth about €3000 but you owe €5000 on it.

New car = €9000
old car = €3000

Cost to change = €6000, regardless of trade in allowance, etc. This figure won't change too much.

Unfortunately, you owe the finance company €5000 which needs to be paid. This, added to the 6000 is where he's getting his 11000.

The dealer must show your old car as costing him €5000 for VAT reasons so in order for him to have your old car standing him right, he has to add the €2000 onto the new car.