Automotive

Taken for a ride at ford?

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  • Sep 15th, 2015 7:29 pm
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[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON

Taken for a ride at ford?

Opinion please! This is the email I sent my dealer today. The background is that I purchased my first new car on August 1st. A 2015 ford focus hatchback (new). It had 30 kms on it. Three weeks later, on Aug 22nd, I was in an accident and the insurance company declared my car a total loss. The good news is that my insurance company (Bel Air Direct), was very fair and gave me a big settlement. yesterday I went in to the same dealership to pick up a new ford focus hatchback for the second time. I am financing through Ford Credit for 1.29% i think the dealership owes me money, but because the forms are signed it's probably too late. Let me know if anyone has any experience here (my brother says I'm being too anal). Here is the email I sent:

Hi guys,

So I went through the numbers and I realize I should have done this before I signed everything, but you live and learn. I did ask Mike via email to send me a cost breakdown, he never did, and I let it go. Here are my concerns:

For the first car I paid:


* 19199 (cost of car)
* 1950 (options)
* discount of 1582 (unspecified discount, just added at the bottom)
$19567 (overall cost of car with options and discounts)
$1665 (freight and air tax)
$299 - secure guard
$299 - ride green cert
$ 2470 - protection plan (warranty)

for a total of $23702 before tax. With tax the price was $26813.26

After additional fees of gas and lien registration fee the amount I financed on the first car was $26865.78

The portion of that amount that I paid for the ESP (plus tax) is: $2791.10

According to the ESP contract, I should get a full refund any ESP plan (see section 13) within 60 days of purchase due to total loss, minus a $75 admin fee. Thus, on my old car I should have been eligible for a $2716.10 refund on that Premium Care plan.

This would bring the amount I owed on my previous loan down to: 24149.65

Minus my insurance settlement cheque of 23858.28, the amount left owing would be 291.37.

Take into account that I will have now made 3 payments on that loan (179 x 3) = 537. You can take off 1.3 % interest off those payments, but in the end I should not have owed anything on that previous loan, I probably should have gotten a little bit back.

Can you tell me if I made any errors on the above calculations or didn't take something into account?

I would appreciate you sending me any of your calculations and paperwork you sent to Ford Credit regarding the closure of my previous loan.


On my new car, the protection pack was $2877.50. Why is it $407.5 more than my first service plan? Also I was charged for some extra things on this car such as "wheel lock ($99)" and licence fee ($92), which I wasn't charged for last time.

In addition this car was listed as new, but after doing some reading, 250 kms on a new car is generally not new. It's hard to know how many people test drove it (obviously a lot) and how they drove it. Someone even went as far as to hook up their phone to MySync. This probably should have been reflected in the price, yet the basic cost of the car (MSRP) was more on the second car than the first.

I am disappointed with the transparency of this process, and I feel as I probably should be paying less than what I am paying, as Mike originally said I would.

I will be bringing all of this paperwork to my local Ford dealer for a second opinion, but I think I was taken for a ride a bit here. To be honest, the thing I am most disappointed about is that you were not open with me about how the car was used before I received it. I also think I was led to believe that I would have owed money on my previous loan, but unless my calculations are wrong, I should not have owed anything once the refund on the ESP was applied.

Please let me know if I have gotten something terribly wrong. I would like to have this cleared up before I am asked to review you guys in regards to this deal.

Thanks,

Meagan
25 replies
Deal Addict
Apr 4, 2013
1274 posts
404 upvotes
I am a little confused. You bought a car on August 1st for $26,813 and had an accident on August 22nd that resulted in a total loss. You received a cheque from the insurance company for $23,858. Have you contacted Ford Credit to get a payout for the loan? That is the first thing that you need to do as soon as the insurance company has settled the claim. The payout request should have been made for the same date as the insurance claim is paid out, as your car loan is incurring interest on a daily basis. Wasn't the insurance cheque made out to Ford Credit? Where is the insurance cheque now?
Deal Addict
Dec 30, 2007
1005 posts
185 upvotes
Ottawa, ON
Lets take out all the nonsense of what you purchased with the car. In the end the amount financed is $26865.78 I assume this includes the ESP you purchased, as the final amount financed is the total sum of the purchase price of the vehicle and any extended warranty/service packages, less your down payment.

$26865.78 - $537 (payments) = $26328.78 loan balance (approximate).

The loan balance of $26328.78 is approximate as I am not including any interest that has accrued since the purchase date to the payout made by Belair Direct.

$26328.78 - $23858.28 (Insurance payout) = $2470.50. This is the approximate amount left remaining owed on the loan after the payout. Again, remember, I did not account for any interest, so it is actually more than the amount I calculated.


$2470.50 - 2716.10 (ESP credit) = -245.6.

The unknown factor here is your financing terms. At most you have $245.60 credit owed to you, but that is not accurate as all my calculations do not account for 22+ days of interest. It is more than 22 days as the payout is not based on the date of which the car was written off, but rather the date of the payout statement Belair Direct requested it for and submitted payment. They could have requested a payout statement dated/calculated 5+ days after the date they determined it was written off.

As for the fees on the new car. It has no reference to anything you had on the old car. These fees represent your lack of negotiation skills and lack of paying attention. You either agreed to a pre-tax purchase amount, at which the dealer tossed in these fees on the purchase agreement. You should have reviewed this more closely and asked questions before signing. If you agreed on a purchase price after taxes, the dealership is free to break down the numbers as they see fit.

As an example. I recently purchased a new car and had an agreed on all-inclusive price. When given the paper work I saw they applied a very liberal discount on the actual vehicle purchase price, but pumped up their dealer admin fee. I didn't care as in the end, the total purchase price matched the amount we had agreed on.

And finally for the 250km on a new vehicle. A new vehicle is a car on their lot that has never been registered before. Again, this is something you should have looked at when you purchased. Is there any chance they had to get the car from another dealer? If so, how far of a distance did they travel? They won't load these on a truck, but rather have an employee drive one of theirs over to the trading dealer and pick up the car you are purchasing and drive it back.
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
Ha, I am not sure of most of those things. The dealership dealt with all of that. I told them the amount that the insurance company was settling for, and they went from there.

The insurance cheque is in the mail and I should have it this week, at which point I need to send it to ford credit. The dealership said I should get one final invoice for the interest accrued between now and when the cheque is delivered.

The insurance company payout does not include the amount of the premium service plan, which I should have been eligible for a full refund (minus a $75 administrative fee). According to the contract a full refund can be issued within 60 days of purchase.

I asked for the dealership to send me all the details, and they said they would on Monday.
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
Well, I agree it is my own fault that I ended up here (live and learn), but why would the ESP plan go up in price (the exact same plan) and why would the sticker on the window say $19,199, but on the invoice the car is listed at $19,450?

You could be right about the transfer of the car. They did not say where they got the car from. Hopefully they clear that up.
Deal Addict
Dec 30, 2007
1005 posts
185 upvotes
Ottawa, ON
mperry381 wrote:
Sep 13th, 2015 4:56 pm
Ha, I am not sure of most of those things. The dealership dealt with all of that. I told them the amount that the insurance company was settling for, and they went from there.

The insurance cheque is in the mail and I should have it this week, at which point I need to send it to ford credit. The dealership said I should get one final invoice for the interest accrued between now and when the cheque is delivered.

The insurance company payout does not include the amount of the premium service plan, which I should have been eligible for a full refund (minus a $75 administrative fee). According to the contract a full refund can be issued within 60 days of purchase.

I asked for the dealership to send me all the details, and they said they would on Monday.
The insurance payout may not include the ESP, but the balance of your loan does. It is strange the insurer is sending you a cheque and would do so by mail. I would expect them to communicate directly with Ford Credit to get the balance owed, and deliver the funds. Think of it this way. If you owed $20,000 on the loan, and Belair Direct was paying out $23,000, they wouldn't send you a cheque for $23,000. They would issue a cheque for Ford Credit for $20,000 and pay you the remaining $3,000 balance. It is too risky for them to send payment to the purchaser for the full amount as there is no guarantee the purchaser forwards the require payment to Ford Credit. This leaves Ford with an unpaid loan and a lien on a write-off.

Call Ford Credit, ask them for the payout balance and the per diem rate (daily interest $ amount). Contact Belair Direct and ask if payment is being sent to you, or directly to Ford.

As for the sticker/invoice price. Is the pricing breakdown matching that of the MSRP? If not, the dealer is free to set their own pricing, but it is strange that they would put the sticker price below invoice.
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
The finance manager got back to me and said that she refunded the original amount of the ESP minus $75. She did not refund the tax. Is that legal?? She is trying to tell me that instead of refunding the full amount she gave me an additional $500 below employee pricing (the current incentive) on my new car. That would be well and good except that she discounted a car that cost MORE than the MSRP. MSRP was $19,199. The car that I bought was $19469. (these amounts do not include options)

The cheque is being sent to me, but I think it is co-payable to myself and Ford.
Wood0209 wrote:
Sep 13th, 2015 7:41 pm
The insurance payout may not include the ESP, but the balance of your loan does. It is strange the insurer is sending you a cheque and would do so by mail. I would expect them to communicate directly with Ford Credit to get the balance owed, and deliver the funds. Think of it this way. If you owed $20,000 on the loan, and Belair Direct was paying out $23,000, they wouldn't send you a cheque for $23,000. They would issue a cheque for Ford Credit for $20,000 and pay you the remaining $3,000 balance. It is too risky for them to send payment to the purchaser for the full amount as there is no guarantee the purchaser forwards the require payment to Ford Credit. This leaves Ford with an unpaid loan and a lien on a write-off.

Call Ford Credit, ask them for the payout balance and the per diem rate (daily interest $ amount). Contact Belair Direct and ask if payment is being sent to you, or directly to Ford.

As for the sticker/invoice price. Is the pricing breakdown matching that of the MSRP? If not, the dealer is free to set their own pricing, but it is strange that they would put the sticker price below invoice.
Deal Addict
Jun 26, 2009
3012 posts
1786 upvotes
GTA
You should pay off the original loan with insurance cheque. Get the refund (if applicable) for the ESP. And than go and start your negotiations from the scratch. Applying deal numbers from over a month ago will always cause some confusion and dealer will try to squeeze more money from you.
Deal Addict
Dec 30, 2007
1005 posts
185 upvotes
Ottawa, ON
I would think when you're getting a refund you're required to get the tax in return. That is equivalent to buying a $100 item from the store, paying 13% tax for a total of $113, returning it with the receipt and only getting $100 in return. However, are you saying you got full ESP minus the $75, and you're asking about the tax on the $75? Give us actual amount you paid for ESP and the amount you're being refunded.

As Tommy said, settle the debt of the previous vehicle and ESP prior to negotiating the price of the new car. Seems the dealer wants to mix and match numbers under the guise you're getting a good deal.
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
No, the Finance Manager actually said she only refunded me 2470 minus the $75 admin fee, thereby just keeping all that tax I paid. She actually said in an email she did not refund the tax. She didn't even justify it, she just said that's what she did. Another point, the car had 250 kms on it and I have asked them about five times where the extra kilometers came from, and still no answer . . .

I've also asked for a refund on the current ESP, as I feel I was coerced into buying it (said my financing depended on it). I should have 30 days to get a full refund, but now no one is responding to my emails . .

Not sure what to do if they stop responding all together?
Deal Addict
Sep 14, 2010
1088 posts
256 upvotes
Toronto
not sure if it will help you but.. prob letting people know what dealership location it is and pressure on social media if they have presence will help you whip up some answers.
Deal Addict
Dec 30, 2007
1005 posts
185 upvotes
Ottawa, ON
Attend at the dealership in person. Ask for the finance manager, and when she arrives, immediately request a joint meeting with her and the general manager. The GM may not be available right at that time, so you may need to schedule something in the next day or two.

How did she get $2470? I looked at my previous post and my calculation for $2470 was estimated balance owed on the loan, and your ESP was 2716.10 after the $75 admin fee.

You should be getting the ESP valye and tax refunded, less the $75 admin fee and associated taxes to that (84.75).
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
This is the response I received regarding the kms on my car:
"in regards to the mileage and phone on your new car, 250 km on a vehicle at this time of year, (after others have test driven) is normal. Other people have test driven vehicles as part of the purchase process. If a customer has test driven a car, and wanted to see how our Sync system works, they could have hooked up their phone just to see how it works and how easy it is. It doesn’t the affect the value of the car, or its “newness” in any way."

Is she serious??? So any person buying a "new" car at this time of year should just expect that it will have been test driven by 30 people and just accept that the price shall remain the same regardless? Anybody else think that is ridiculous??

This is Ed Learn Ford, in St. Catharines by the way. BEWARE
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
I'm one hour away from an OMVIC complaint . . .
[OP]
Newbie
Jan 6, 2015
16 posts
4 upvotes
East York, ON
And now this response:

Please understand. The 250 km on the car is not in any way high enough to factor into pricing. We did give you a discount $500.00 below Family pricing.

Unfortunately, Ford Warranty does not refund sales tax. Your insurance company would have paid you that in your settlement. If you were purchasing a new
Warranty, the refund would have been deducted from the cost of the new warranty, thereby negating any tax effect. When we receive the amount from Ford, you will be contacted via email."

CAN SOMEBODY PLEASE TELL ME IF IT IS LEGAL TO NOT REFUND SALES TAX??? That's over $300!!

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