How would you pay for the truck?

[herofan]

I have a question just to see what others would do.

My brother is looking to buy a truck at a dealer for around $22,000 and wants to pay in cash. He said the dealer acted as though he pulled a cobra out of a bag when he mentioned it. My brother said the dealer talked forever about "payments" before he would even tell him the full price. He then said that most people don't just walk in and pay for one straight out. My brother and I are thinking, "so what."

Is there something we're missing? How would it be to his benefit, which is what we're out for, to make payments when he has the cash?

 

[chrisy]

If paying by payments are 0% interest free then it will be if he puts the money in an account and pays for the truck from it, as all the interest incurred by the money is his and not the truck companies, that's what we did last year. If it isn't then cash is the best. but check what is the amount of cash you can lay out before the IRS ask questions. as our tax department what to know how you got that amount of cash in one go. even if you have payed your taxes.

 

[wbvs58]

They get kickbacks from the finance companies. I would also be wary of over inflated price as they advertise the repayment instalments to gloss over the inflated purchase price to attract those that are more needier than you. When buying I would always arrange my own finance independantly where I new the interest rate if I didn't have the cash. By arranging it for you the dealer feels that he has a stronger hold on you and that he is doing you a favour and again an inflated price.
Ken

 

[TennesseeTuxedo]

I have a question just to see what others would do.

My brother is looking to buy a truck at a dealer for around $22,000 and wants to pay in cash. He said the dealer acted as though he pulled a cobra out of a bag when he mentioned it. My brother said the dealer talked forever about "payments" before he would even tell him the full price. He then said that most people don't just walk in and pay for one straight out. My brother and I are thinking, "so what."

Is there something we're missing? How would it be to his benefit, which is what we're out for, to make payments when he has the cash?

New or used truck?

It's certainly your brother's right to pay cash for this vehicle.

 

[HDRider]

My experience has been when they reduce the interest rate they don't lower the sale price (or not as much). When they lower the price they don't offer 0% or such a low rate.

Take the lowest purchase price you can get. If you got cash and can't invest it at a better rate, pay cash. If you can get 4% interest to finance the vehicle and can invest the cash to get 4% + then finance.

Smart or not, I have paid cash for my last three vehicles, but I have not bought one during these crazy low interest rates and this crazy high stock market. I drive 'em till the wheels fall off.

The dealer does get some pay when they finance.

 

[houstoncutter]

Bought one back in 09. I financed it for one month because I got a 2500$ rebate if I financed it... When that first payment came due I wrote em a check for the payout....Clearly they weren't happy with it, but there wasn't anything they could do.

 

[Kingfisher]

We had a problem paying cash at a Honda dealer a few years ago. It was crazy the way they treated my friend. We ended up going to another dealer on the way home and in less than thirty minutes bought the same type car for cash. They had to go to San Antonio to get it but it only had 6miles instead of 14. At one point I had to remind the punk finance manager that "it's a Honda dude not a one off Ferrari ...."

 

[Jogeephus]

My experience has been when they reduce the interest rate they don't lower the sale price (or not as much). When they lower the price they don't offer 0% or such a low rate.

Take the lowest purchase price you can get. If you got cash and can't invest it at a better rate, pay cash. If you can get 4% interest to finance the vehicle and can invest the cash to get 4% + then finance.

Smart or not, I have paid cash for my last three vehicles, but I have not bought one during these crazy low interest rates and this crazy high stock market. I drive 'em till the wheels fall off.

The dealer does get some pay when they finance.

Exactly right. The car folks are making as much if not more on financing. 0% isn't real. Its marked up to compensate for this "free interest". Ain't nothing free but making you feel like you are getting something for nothing is what their job is. I was looking at a tractor and the selling point was 0%. I asked what the cash price was and it was $6000 cheaper. Also if you were to finance it this way and you went to pay it off early you would see the interest rate being paid. I think this is why they can claim 0% but they can't say "no interest".

Try to figure out all the incentives too. These are sometimes hidden. Last big ticket item I bought I leased it for two months then bought it off the lease. In doing this I got a rebate when I leased it then another rebate when I bought it. Made no sense to me but when you looked at the figures it was a no brainer.

 

[jedstivers]

First thing is go to a different dealer. Trucks are bought every day with cash or a check for the full amount.
Remember though when you are thinking of financing something for the farm the interest in tax deductible.

 

[dun]

I was looking at a truck last year and the Ford guy (who happens to be a friend of mine) told me to finance it since Ford had a sizeable discount for financing through them. He said to finance it then pay it off after a month. I checked and there was no prepayment penalty. He finally talked me out of buying a new truck, said for waht I need a truck for what I have works fine unless I jsut wanted a new truck.

 

[TexasBred]

Go to another dealer and price the same truck. Tell him where the truck is that you want or at least make sure he knows the exact specs.....drive out....no rebates, no financing..just cash price. Take the best price and write the man a check.

 

[jedstivers]

I was looking at a truck last year and the Ford guy (who happens to be a friend of mine) told me to finance it since Ford had a sizeable discount for financing through them. He said to finance it then pay it off after a month. I checked and there was no prepayment penalty. He finally talked me out of buying a new truck, said for waht I need a truck for what I have works fine unless I jsut wanted a new truck.

I was pricing one a month or so ago and Ford was 1,500 cheaper if I financed instead of writing a check. I didn't buy though.

 

[chrisy]

sounds like your finance system is different to ours, as we have a 0% interest with our car and it would have cost the same if we had bought it for cash, there is no catch at the end, and believe me my Hubby went through it with a fine tooth comb, (deep pockets short arms in this case) so we kept our money in our account to get the interest in our pocket and not theirs.

 

[bigbull338]

dealers make money to an extent on any car or truck they finance.my brother has bought new trucks in 2008 2009 an 2011.1st truck he dealer financed an payed it off in 18 months.the 2nd an 3rd trucks he bought he ended up paying cash for.the dealers didnt care how he payed for them.joe as for tractor dealers making you pay their interest it works both ways.i made my tractor dealer pay half my interest on the tractor i bought in 2010.then in 2013 when i traded that tractor.they knocked off $7000 off the 1 i traded for.so once again my interest was free on the new tractor.

 

[Shantilly]

The only upside to financing is that helps your credit score. I was told this by a few trust worthy sources... i have crap credit and still wouldn't do it.. i pay cash and own it..no monthly note to worry about.. and when my uncle sams savings account comes in.. i am going to pay my insurance for a year instead of a month at a time being a single parent and limited income makes you learn a lot of money saving tips fast...

 

[greybeard]

I was looking at a truck last year and the Ford guy (who happens to be a friend of mine) told me to finance it since Ford had a sizeable discount for financing through them. He said to finance it then pay it off after a month. I checked and there was no prepayment penalty. .

I was told exactly the same thing 8 months ago by a Ford dealership. GM would not go the same terms tho--they had an early payoff penalty--so did Chrysler. They are making a killing off financing nowadays. We ended up buying the Chrysler product and paid cash--had more room in it and that was what the wife wanted. It was a car.

Cash don't talk like it did several decades ago for sure.

 

[skyhightree1]

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