Lawyer Help - Car Contract Question

[Dr. Blackheart]

Maybe you cats should move out of a transactional relationship to a service relationship with your dealer?  Been with the same dealer since college. Free loaners, finds rebates, slips in warranty work, shared weddings, funerals, has donated to our causes and given car giveaways to friends in severe need. Even did a tow in Milwaukee back to Chicago for free.  Pay and fair price, and have been paid back in full. Deals are literally a handshake.

[reinko]

I love the car buying game, maybe it's a career of being in sales, and being on the other side of the table, but I love it.

My advice:

-Do as much of your negotiating over the internet. Never just walk into a dealer blind.
-Use your email quotes against other dealers, don't fight for every last dollar over email, but you'll know who to use/eliminate rather quickly.
-Never negotiate for the monthly payment, but have in your head your plan of how much you have budgeted to pay per month. My two cents, never go above 60 months on financing
-Eventually when you decide what dealer to walk into, let them know up front you talked to Billy/Susie in the internet dept, and you have a quote from him/her. This immediately gives you a little bit of leverage
-Don't get emotional, don't be a jerk to the sales rep. He/She should be motivated to work with you, and your gut instinct will start to tell you soon into the process whether you're going to do a deal or not
-Know your credit score and what the finance options are before you walk into the dealer. Interest rates keep going up, if you see a dealer advertising 2.9% on their website, see if you can go to a credit union and do better than that. Keep that better finance rate though in your back pocket. Dealers may give you a better purchase price knowing they're getting an incentive for you to finance at their rate through that car mfg's financial institution. Just re-fi after you make one payment
-Know how much you want to put down, don't do a penny more. As others have said, if the dealer knows you want to pay $400 a month, they'll tell you to throw an extra $1000 (or whatever) down to get you there.
-Never ever take the extended warranty. Ever. Do a Nancy Reagan, just say no. It's uncomfortable with the finance mgr, just get through it. They're going to ask you open ended questions like "what would you do if the XXXXX failed/died? It's $4000 to replace it". My simple response has always been "Well, I'd never buy another Honda/Toyota/Ford ever again, and would certainly never set foot in here again."
-Be comfortable walking away. If you know the deal is going south, simply say no thanks, we're going to leave. The dealer wants you there as long as possible, your time is important, if it's not going well, there's plenty of other cars/dealers out there that you can make a deal with

Not too mention, I think it was mentioned above, but you can buy an extended warranty after your purchase your care, at a fraction of the price.  I got quoted for one @ my dealer for around $4,000 (to extend from 3 yr/36,000 to a 7/yr 100,000).  I found the same one, from another dealer online for like $1,900.

[warriorchick]

Maybe you cats should move out of a transactional relationship to a service relationship with your dealer?  Been with the same dealer since college. Free loaners, finds rebates, slips in warranty work, shared weddings, funerals, has donated to our causes and given car giveaways to friends in severe need. Even did a tow in Milwaukee back to Chicago for free.  Pay and fair price, and have been paid back in full. Deals are literally a handshake.

No car dealer has ever made enough money off of me to offer me all this "free" stuff.  I think we come out ahead in the long run.

[warriorchick]

No car dealer has ever made enough money off of me to offer me all this "free" stuff.  I think we come out ahead in the long run.

It always tickled me that when trying to sell you the car, they go on and on about how reliable it is.  Then the minute you agree to buy it, the first thing they do is to try to sell you an extended warranty.

[real chili 83]

I love the car buying game, maybe it's a career of being in sales, and being on the other side of the table, but I love it.

My advice:

-Do as much of your negotiating over the internet. Never just walk into a dealer blind.
-Use your email quotes against other dealers, don't fight for every last dollar over email, but you'll know who to use/eliminate rather quickly.
-Never negotiate for the monthly payment, but have in your head your plan of how much you have budgeted to pay per month. My two cents, never go above 60 months on financing
-Eventually when you decide what dealer to walk into, let them know up front you talked to Billy/Susie in the internet dept, and you have a quote from him/her. This immediately gives you a little bit of leverage
-Don't get emotional, don't be a jerk to the sales rep. He/She should be motivated to work with you, and your gut instinct will start to tell you soon into the process whether you're going to do a deal or not
-Know your credit score and what the finance options are before you walk into the dealer. Interest rates keep going up, if you see a dealer advertising 2.9% on their website, see if you can go to a credit union and do better than that. Keep that better finance rate though in your back pocket. Dealers may give you a better purchase price knowing they're getting an incentive for you to finance at their rate through that car mfg's financial institution. Just re-fi after you make one payment
-Know how much you want to put down, don't do a penny more. As others have said, if the dealer knows you want to pay $400 a month, they'll tell you to throw an extra $1000 (or whatever) down to get you there.
-Never ever take the extended warranty. Ever. Do a Nancy Reagan, just say no. It's uncomfortable with the finance mgr, just get through it. They're going to ask you open ended questions like "what would you do if the XXXXX failed/died? It's $4000 to replace it". My simple response has always been "Well, I'd never buy another Honda/Toyota/Ford ever again, and would certainly never set foot in here again."
-Be comfortable walking away. If you know the deal is going south, simply say no thanks, we're going to leave. The dealer wants you there as long as possible, your time is important, if it's not going well, there's plenty of other cars/dealers out there that you can make a deal with

This isn't for everyone, but I am quite comfortable saying no to an extended warranty because I do a lot of my auto repair myself. I did not grow up wrenching on cars and am not a mechanical engineer.  Instead, I've asked a lot of questions of people who know cars, find you tube videos (there's a TON of good ones out there), and as a last resort, know a few people who do work out of their home garage.  Outside of stuff covered by the original warranty, I've not taken a car to a mechanic in years.  I also can get parts pretty cheap.....St. Paul Park Auto Parts.  If you live anywhere near there, you have to go in and try them.  Their office is just "iconic"  You've never see more ground-in chicken bones, pizza boxes, and old soup cans laying on the floor.  It's so filthy, it's almost funny.  However, their prices are so low, none of the big chains will match their prices.  They do a crap-ton of business.

Brake jobs are classic.  Go to a dealer, and they want around $100,if not more, and will try to talk you into new rotors too.  A set of brake pads are about $20.  I love how shops try to scare people with "ITS YOUR BRAKES", don't risk it!

Here's another example.....I was getting an engine light, and the car's computer put the car into low power mode.  I looked this up on YouTube.  I had a buildup of carbon on the intake manifold.  The fix involved a screwdriver, a rag, some carb cleaner and 5 minutes of my time.  That would have been a $300 - $500 repair at a dealer.  One other example....a couple of years later, I got the same code.  The second most common cause of this was the Throttle Position Sensor (TPS) was bad.  Bought a new one for $50, and replaced it in 5 minutes.

Also, don't be afraid to ask for repairs covered under the original warrant after it's expired.  GM put in a new AC compressor on my Tahoe 30k miles after the warranty expired.

[DegenerateDish]

It always tickled me that when trying to sell you the car, they go on and on about how reliable it is.  Then the minute you agree to buy it, the first thing they do is to try to sell you an extended warranty.

I legit LOL'd at this, so true!

[jsglow]

I am admittedly not great with numbers - can you explain why it is a bad idea to negotiate based on the payment?

Because it blurs your objectivity and research regarding the transaction.  Know what you are paying for your car (so you can compare).  Know what you are getting for your trade (so you can compare to blue book).  Know the interest rate you are paying and the terms of your loan.  The 'payment' simply falls out of that as a calculated figure.  Now to have a sense as to the size of payment you're interested in/capable of?  Fine.  But that doesn't overshadow knowing those other relevant facts.

[StillAWarrior]

Because it's easy for the dealer to say:

"oh, you want your payment to be $xxx, then just take 72 month financing, instead of 60 month"
"oh, you want your payment to be $xxx, then just put $2K down instead of nothing"
"oh, you want your payment to be $xxx, then just lease for 36 months, instead of buying..."

yadda, yadda, yadda...

And this is why, when I used to lease, I was insistent on getting all the different numbers.  There are just so many places they can screw you when you lease  if all you're trying to do is bring the monthly payment down.  Here are some common ones, but I'm sure there are others:  higher down payment (look for "capital cost reduction"); higher buy out amount (look for "residual value"); longer term (e.g., 30 months instead of 24); fewer miles included (e.g., 10k/year instead of 18k); higher fees.  That is why, as mentioned in my post above about the email exchange, I always insisted that they tell me each of those different numbers so I could see where they were "hiding" the amount.  That dealer I was dealing with had initially quoted me a sale price that was several thousand dollars higher than the other dealer, but he was promising a cheaper monthly payment.  It's not difficult to recognize that if the price is higher, but the payment is lower, they're "hiding" that extra money somewhere.  Depending on how you plan to use the car or whether you plan to buy it at the end of the lease, you might not care about some of the issues, and if you realize that they're adding it in to the buyout price of a car you have no intention of buying at the end of the lease you might not care.  But, if you're comparing multiple quotes, it is really helpful to have all of those different numbers.

[warriorchick]

And this is why, when I used to lease, I was insistent on getting all the different numbers.  There are just so many places they can screw you when you lease  if all you're trying to do is bring the monthly payment down.  Here are some common ones, but I'm sure there are others:  higher down payment (look for "capital cost reduction"); higher buy out amount (look for "residual value"); longer term (e.g., 30 months instead of 24); fewer miles included (e.g., 10k/year instead of 18k); higher fees.  That is why, as mentioned in my post above about the email exchange, I always insisted that they tell me each of those different numbers so I could see where they were "hiding" the amount.  That dealer I was dealing with had initially quoted me a sale price that was several thousand dollars higher than the other dealer, but he was promising a cheaper monthly payment.  It's not difficult to recognize that if the price is higher, but the payment is lower, they're "hiding" that extra money somewhere.  Depending on how you plan to use the car or whether you plan to buy it at the end of the lease, you might not care about some of the issues, and if you realize that they're adding it in to the buyout price of a car you have no intention of buying at the end of the lease you might not care.  But, if you're comparing multiple quotes, it is really helpful to have all of those different numbers.

I would never lease.  It only makes financial sense if you trade in cars every few years (and then not always), which in and of itself isn't the most financially sensible thing to do.

Buy a gently used car (with cash, if possible) and drive it until it dies. 

[StillAWarrior]

I would never lease.  It only makes financial sense if you trade in cars every few years (and then not always), which in and of itself isn't the most financially sensible thing to do.

Buy a gently used car (with cash, if possible) and drive it until it dies.

The only reason I leased was I had an employer who provided a car allowance and expected that I would have a new car every couple of years.  Since then (four or five cars), we've done exactly as you mention -- fairly low mileage used cars and never in a rush to buy when we do start looking.  I honestly doubt we'll ever have a new car again.

[dgies9156]

As you can tell, I'm not a very nice guy.   

That's what Sister Chick says. 

Seriously, to be in business, you have to say "no."  That's not being nice or mean, it's reflecting the realities of what you can and cannot do.

[jsglow]

That's what Sister Chick says. 

Seriously, to be in business, you have to say "no."  That's not being nice or mean, it's reflecting the realities of what you can and cannot do.

Recalling that I spent a career in troubled debt workout, I have a classic line:

"I don't mind you asking if you don't mind me saying no."  Said it literally thousands of times.   

[Dr. Blackheart]

No car dealer has ever made enough money off of me to offer me all this "free" stuff.  I think we come out ahead in the long run.

Spoken like a true beancounter!

[dgies9156]

I would never lease.  It only makes financial sense if you trade in cars every few years (and then not always), which in and of itself isn't the most financially sensible thing to do.

Buy a gently used car (with cash, if possible) and drive it until it dies.

We leased for one of my children going to college for 36 months. No money factor to speak of and the resid on the car 2.5 years in is holding to the market value. No fights over who gets it and no money and I mean no money up front.

We did the gently used bit twice and I generally agree. One was a VW Eos, which had 28,000 miles seven years ago and we still have (gently used) with 78,000. Paid cash.

The second is a BMW 5-Series which we purchased a couple weeks ago. Originally $58,000; lets just say the deal we got was no where near that amount. The first three years of depreciation is obscene. So we get it after the value "puts some clothes on."

[GGGG]

I would never lease.  It only makes financial sense if you trade in cars every few years (and then not always), which in and of itself isn't the most financially sensible thing to do.

Buy a gently used car (with cash, if possible) and drive it until it dies. 

Eh.  We lease a car for my wife because she likes to drive new cars and switch them up every couple years.  Not a huge luxury by any means, but she likes it.

[Dr. Blackheart]

Listen, if you want to be transactional and buy on price and product only, don't expect full service. It's like buying Allen Edmonds on Amazon and complaining their service and quality have fallen.

Today, just about every purchase has a good-better-best option. Southwest has free check-in, for a bit more you can have the bit grab your seat, and for a bit more you can pay to be in the first 15 slots. But, don't select the general check-in and then complain there are only middle seats in the back.

Same with cars. If you are an internet price shopper, you aren't buying the full service option. You are transactional. Don't expect the upgraded floor mats.

[DegenerateDish]

Listen, if you want to be transactional and buy on price and product only, don't expect full service. It's like buying Allen Edmonds on Amazon and complaining their service and quality have fallen.

Today, just about every purchase has a good-better-best option. Southwest has free check-in, for a bit more you can have the bit grab your seat, and for a bit more you can pay to be in the first 15 slots. But, don't select the general check-in and then complain there are only middle seats in the back.

Same with cars. If you are an internet price shopper, you aren't buying the full service option. You are transactional. Don't expect the upgraded floor mats.

I actually got the upgraded floor mats when I bought my Accord Hybrid (I didn't ask for them, they showed up in the car at walk through, sales rep just said "we threw these in"). But point taken, you're correct.

[warriorchick]

Spoken like a true beancounter!

"Free" is one of the misused words in the English language.

When chick jr. visited Marquette as a prospective student, we took a tour of Raynor library.  The tour guide pointed to a PrintWise machine, and told everyone that ever student could print out a certain number of pages for free every semester.

"Excuse me," I said, "That printing is not free. It's included in the $35 grand we are paying for tuition."  The other parents nodded in agreement.

For the rest of the tour, every time the tour guide said something like, "And we have free tutoring-"  The parents would shout in unison, "Included!".  We had her trained by the end of the tour.

[StillAWarrior]

I actually got the upgraded floor mats when I bought my Accord Hybrid (I didn't ask for them, they showed up in the car at walk through, sales rep just said "we threw these in"). But point taken, you're correct.

My wife always insists on the all-weather mats once everything else is pretty much hammered out.  She's never been denied yet.

I honestly am not terribly interested in the "service" aspect of the purchase.  And, aside from the somewhat odd email exchange I wrote about above, I've never had a particularly noteworthy experience (good or bad) when purchasing a car.  We generally know what we're looking for when we show up and just want a quick* test drive and then get pretty quickly to what we're willing to pay and work out the price.  Are we leaving money on the table?  Maybe...I don't know.  Probably.  But we've always been satisfied with the prices/deals that we've gotten -- and I always do a fair amount of research on comparable vehicles so I know generally what is a decent price.

*And I do mean "quick."  My wife's test drives are legendary.  She just wants to have a very basic confirmation that she's comfortable in the car.  With no exaggeration, she's had "test drives" that have lasted about 120 seconds.  Literally drive a block, turn around and return.  I've come to accept that's just how she does it.  And I'm not just talking about eliminating cars from consideration based upon these short tests; she's also picked cars this way.

[jsglow]

Listen, if you want to be transactional and buy on price and product only, don't expect full service. It's like buying Allen Edmonds on Amazon and complaining their service and quality have fallen.

Today, just about every purchase has a good-better-best option. Southwest has free check-in, for a bit more you can have the bit grab your seat, and for a bit more you can pay to be in the first 15 slots. But, don't select the general check-in and then complain there are only middle seats in the back.

Same with cars. If you are an internet price shopper, you aren't buying the full service option. You are transactional. Don't expect the upgraded floor mats.

Agreed.  But what folks are discussing here are dishonest business practices, bait and switch, etc.  And I never complain about my B-46 boarding pass on SWA.  Not to hijack, but we were all thrilled when a pastel sweatered golf guy got 'moved' to a rear middle seat when he tried to hold a couple seats for his late arriving buddies and a well dressed African American man and his wife reminded him that seat saving wasn't allowed and those two next to him were the last two the couple saw together.  When he no longer wanted to sit next to 'those' people, the FA found him a wonderful alternative.   

[buckchuckler]

Dealerships don't make the majority of their money off the sale of the car.  They make more off of service and financing.  Many make most of their money from the manufacturer off of incentive programs for hitting certain numbers or other goals. 

Just because you have a good relationship with a dealership and salesperson doesn't mean you are paying too much.  It means that the dealership wants to keep you as a consistent customer for all of their services, of which, the vehicle purchase is just a small portion.

[reinko]

"Free" is one of the misused words in the English language.

When chick jr. visited Marquette as a prospective student, we took a tour of Raynor library.  The tour guide pointed to a PrintWise machine, and told everyone that ever student could print out a certain number of pages for free every semester.

"Excuse me," I said, "That printing is not free. It's included in the $35 grand we are paying for tuition."  The other parents nodded in agreement.

For the rest of the tour, every time the tour guide said something like, "And we have free tutoring-"  The parent's would shout in unison, "Included!".  We had her trained by the end of the tour.

As a former tour guide, thank you for your service.   

[MU82]

It always tickled me that when trying to sell you the car, they go on and on about how reliable it is.  Then the minute you agree to buy it, the first thing they do is to try to sell you an extended warranty.

I actually have said a form of this every time the business manager tries to sell me an extended warranty.

Something like, "I don't need an extended warranty because I've been promised that this is the best-built, most-reliable car I'll ever drive."

Given their brand's 5-year bumper-to-bumper and 10-year drivetrain warranties, Hyundai dealers must not be doing brisk extended-warranty business. At least I hope not.

[mu_hilltopper]

I bought a 3 year old minivan this spring and .. gasp .. bought the extended warranty.  5 years, $500 a year.  Our last minivan (same model) .. years 5-6-7-8 were rough.  Expensive things broke.  We easily spent $2500 on it in its last few years, and it needed more when I dumped it.

One thing .. the minivan I was purchasing had zero warranty.  If I drove it off the lot and found the sunroof was inoperable, I had zero recourse.  The extended warranty had a 30 day full-refund cancellation policy .. so I figured it was a free way to get a 30 day warranty.  I could cancel on Day 29 .. but I kept it.

One other bonus to the EW .. free key-fob replacement for any reason.  Those damn things are $600 to replace.  BOTH of my previous fobs were non-functional when got rid of the old car.    I am totally getting a few new ones out of this.

[Frenns Liquor Depot]

I bought a 3 year old minivan this spring and .. gasp .. bought the extended warranty.  5 years, $500 a year.  Our last minivan (same model) .. years 5-6-7-8 were rough.  Expensive things broke.  We easily spent $2500 on it in its last few years, and it needed more when I dumped it.

One thing .. the minivan I was purchasing had zero warranty.  If I drove it off the lot and found the sunroof was inoperable, I had zero recourse.  The extended warranty had a 30 day full-refund cancellation policy .. so I figured it was a free way to get a 30 day warranty.  I could cancel on Day 29 .. but I kept it.

One other bonus to the EW .. free key-fob replacement for any reason.  Those damn things are $600 to replace.  BOTH of my previous fobs were non-functional when got rid of the old car.    I am totally getting a few new ones out of this.

My god man. Have you learned nothing in this thread—you paid for that key fob.