What this has to do with the is the cash purchase incentives given to the dealer(buyer) from the manufacturer.Paulfistinyourface wrote: ↑Feb 19th, 2010 4:10 pmWhat? The dealer doesn't actually provide the financing so why would they try to recoup the cost of something that costs them nothing? You make it sound like the dealer is charged a fee by GMAC/Ford/whoever whenever they sell a vehicle at the low rates.
I can only speak for GM, but the dealer is given cash incentives to push the low borrowing rates. Matter of fact, a lot of time the customer is further ahead to take the 0% as opposed to paying cash because the dealer will often take this free cash into consideration when working out a deal. We get incentives not only from GM, but also from GMAC or whoever else might be providing the finance special of the week.
I should add that the worst thing a person could do is to sit at a dealer and pretend like you know all about how the financing works and dealer incentives and rebates and tell them how you should be getting this and that and the other thing. Trust me, the F&I people will laugh at you in the other office and this attitude will do more harm than good. They get the biggest laughs when somebody says "okay, but I read on the internet..."
Yeah, the F&I guys where I work can be jerks. But it's pretty much the same all over the place.
If you finance, you don't qualify for the cash purchase discount. Which means you will be paying more for the car buy financing than by doing a cash purchase.
You are rarely ahead by going with the 0% over the cash purchase incentives... The dealer incentive to push the low finance rate is nowhere near the incentives for a cash purchase. This may be different on > 0% financing though...