Paying Cash on car purchase

[o0vL]

im looking to buy a car in a couple of months and i have been withdrawing $XXX amount out of my bank account on a monthly basis and storing it in a safe in my room. if i dont do this then i will just be spending the money on something else...probably a strange way of saving/managing my money but it works for me.

will there be any questions asked when doing a cash payment? i.e. dealer asking for bank receipts/statements etc? it will be approx $15K

[Pete_Coach]

It doesn't happen very often so there could be questionable looks. Take your money, put it back in the bank and get a certified cheque for the amount, no issues with that.

[Jucius Maximus]

You are taking a highly responsible, admirable and intelligent approach here. If more people took an honest approach to handling their own behaviour like you are doing, we would have much less financial turmoil in the world today.

When I got my last car, I also paid "cash" which was financed through other means, and they wanted a bank draft or certified cheque.

That said, cash money has incredible power. If you start pulling out $100 bills and tell them this is how much you are willing to pay, it will often cause many sales managers to go blind with greed. Don't bring enough cash for the asking price. Play upon their greed to get them to agree to a lower price. If they know they can close the deal that day, you have the advantage. They may close the sale for less money than you would normally pay because of the immediacy of the cash money right in front of them.

That said, you will probably have to take your cash to the bank branch, deposit it, and then get it back in the form of a bank draft or certified cheque.

[o0vL]

Thanks for the responses.
A question to your responses.

Doesn't the bank have a daily "deposit limit" of $3K or so without questioning where the money comes from?

I have been taking out the money throughout the past 2 years or so. And i believe the tellers can only see the past records of up to 6 months or so.

[Jucius Maximus]

Doesn't the bank have a daily "deposit limit" of $3K or so without questioning where the money comes from?

I have been taking out the money throughout the past 2 years or so. And i believe the tellers can only see the past records of up to 6 months or so.
Phone the bank and ask them. Limits are different for different accounts. Also, other limits have come into law due to anti-money-laundering legislation.

As for what tellers can or cannot see, that probably also depends on the branch. Bring in your statements if necessary.

If depositing $15K is out of the ordinary for you, they may indeed ask you where it came from.

[c0ulter]

There is no limit on how much cash you can use for the purchase. However if you use over a certain amount, (I think its around $8000) it has to be reported to the bank. So be prepared to show them where you got it from.

[boyoflondon]

If you take that amount in cash, then there might be ...

Get a certified cheque and there will be no issue ... We just got 15.4k in cert chq and there were no questions.

[firechkn]

I made a $20k cash purchase years ago for a new demo car. The look on there faces was priceless.

Once we agreed upon the purchase price, and upon delivery I paid the entire amount in cash which I have been saving for some time. No problems whatsoever paying cash. It was a pleasant experience.

[shawn99]

Better to pay part of it by a credit card to reap the points/cash-back rewards

[Jucius Maximus]

I made a $20k cash purchase years ago for a new demo car. The look on there faces was priceless.

Once we agreed upon the purchase price, and upon delivery I paid the entire amount in cash which I have been saving for some time. No problems whatsoever paying cash. It was a pleasant experience.

This was at an actual new car dealership? Which brand? Or was it some kind of other dealership?

[Si98]

An old classmate of mine paid cash for his house and brought the money over to his realestate agent's office in a shoebox. All $263K of it believe it or not. He said that's how they do it in Taiwan. Don't believe in cheques and people over there get paid in cash rolled up with a rubber band.

[l69norm]

There is no limit on how much cash you can use for the purchase. However if you use over a certain amount, (I think its around $8000) it has to be reported to the bank. So be prepared to show them where you got it from.

Cash transactions over $10K get reported to the federal government:
http://www.fintrac-canafe.gc.ca/reporting-declaration/Info/rptLCTR-eng.asp

[frankmp]

Better to pay part of it by a credit card to reap the points/cash-back rewards

I agree, a few years back dealer let me put the whole basic truck cost of $20K on my GM Visa card (only catch was we had to debit the card in ~$3K/per day)....that worked to $600 GM Visa $ for my next purchase.

And to OP, what did you say your address was and which is your room? lol



Frank

[custy]

I don't think many dealers accept cash payments over $X amount anymore. They would gladly accept money orders/bank drafts.

I heard from a colleague that he tried to purchase a new 2009 BMW X5 @ a dealership in the GTA with 50k in cash bills and the dealer rejected the cash and asked for money order... weird...

[Jucius Maximus]

I heard from a colleague that he tried to purchase a new 2009 BMW X5 @ a dealership in the GTA with 50k in cash bills and the dealer rejected the cash and asked for money order... weird...
I suspect the dealer would not want to be on the hook for verifying the authenticity of the cash.

Also, they may have to go through additional trouble in depositing such a large amount of money due to anti-fraud and anti-terrorism laws.

Even with normal cheques, amounts over $10K incur additional delays due to reporting requirements.

[achanna]

I think the term "Cash purchase" is used if you are not financing from the dealer - it doesn't mean hard cash.

For example if you use your line of credit from the bank and take the certified cheque for the purchase price, its considered as cash purchase.

[firechkn]

This was about 10 years ago at a GM dealership in the West end, can't remember which one anymore. It was for a Camaro.


This was at an actual new car dealership? Which brand? Or was it some kind of other dealership?

[o0vL]

Better to pay part of it by a credit card to reap the points/cash-back rewards

That is also true, i thought of it but wouldnt it be suspicious of i made a purchase of 7K on my visa then paid it off the next day? Might just do this and do weekly/bi weekly payments.


I agree, a few years back dealer let me put the whole basic truck cost of $20K on my GM Visa card (only catch was we had to debit the card in ~$3K/per day)....that worked to $600 GM Visa $ for my next purchase.

And to OP, what did you say your address was and which is your room? lol



Frank
a long ways from edmonton;)

[Jucius Maximus]

That is also true, i thought of it but wouldnt it be suspicious of i made a purchase of 7K on my visa then paid it off the next day? Might just do this and do weekly/bi weekly payments.

Suspicious of what? Assuming the original purchase gets authorized (as it's out of the ordinary,) the bank doesn't care if you take a day or a decade to pay it off.

[stuntman]

Thanks for the responses.
A question to your responses.

Doesn't the bank have a daily "deposit limit" of $3K or so without questioning where the money comes from?

I have been taking out the money throughout the past 2 years or so. And i believe the tellers can only see the past records of up to 6 months or so.

You are starting to sound suspicious. Who cares if you get redflagged? Its not like you are depositing 3K+ every month or report a strangely low income on your taxes is it?

Dealers/retailers would rather not take 10K+ in cash for a few reasons:
1) verifying its authenticity
2) potential of theft
3) they have to count the stuff accurately

A couple of thousand in bills would be good pocket money for a deposit. If you show a dealer (don't show it too early) a couple of thousand the prospect of a deal right away sounds more realistic.

sm