I’ve posted about how my credit is messed up mostly because I haven’t even tried to apply for any in the last 8-10 years, and how that is affecting the purchase of a used car. I finally got approval from CPS, which I’m led to understand is kind of a “lender of last resort” for hard credit cases. This was Thursday.
Since then, the dealer has been what he describes as “playing with the system”, ostensibly because CPS is insisting on $1500 down, rather than the $800 (with trade-in) that the dealer had originally offered me. He’s been “playing with the system” for 3 days, and having just spoken to him on the phone, doesn’t expect to be finalized until Monday morning.
What is this “playing with the system”? What is he doing that is taking so freaking long? I’ve spent the last three days in a constant state of stress, putting off doing things just in case he calls to tell me I can pick up my car. It’s like waiting for a damn sword to break the thread and fall on me.
Not familiar with your credit history, but if you don’t/haven’t used credit in the last few yrs you will have a crappy rating. It sounds like the dealer is messing you about, don’t know about the system, if I were you I’d go some place else for your car!
You’ve been approved for credit go find someone who wants your buisness.
My guess for “playing with the system” means he’s either going back to the bank and trying different combinations of deals/rates/terms/down payments to get you a down payment and monthly payment you can afford.
For example, they might want 1500 down, but maybe if they add another year to the payments they might be able to get it down to a thousand. Or they won’t budge on the 1500 down, but if they add another year they might be able to get the payments down to make up for it.
They are fucking you over. Don’t ask me how; I have no knowledge of your particular situation but I will bet my paycheck it ends up with you paying more in interest, fees, or something. Guaranteed. They don’t waste time unless they are getting paid.
Youre fine, I understand the negativity. A lot of people have, and will, be screwed over by not just car dealers, but commission sales people in general.
I have been a car salesman, and been party to many car purchases (new and used) from both sides of the desk… There’s a lot of “get what’s best for me” from the sales staff – but in fairness, there’s a lot of “get what’s best for me” from the consumer too.
The consumer would take a free car if the dealership offered it, and the dealership will charge double if the consumer will pay it – and that’s the same with almost any industry. It’s honestly just a matter of finding the happiest medium you can, on the product you want, and trying to do it in a stress free way.
This may not work. I’d go so far as to say it almost certainly won’t. If you’re using a last-resort credit agency to finance the purchase of a vehicle, you will have strings like steel hawsers attached. It’s likely that the credit agency has approved the loan only on the specific vehicle that you’re looking at, and even more likely that you’d have to start the process all over again if you go to another dealer. This is not like getting pre-approved for a mortgage and then going house shopping.
Sorry you’re having to use this kind of loan. They are a gigantic pain for everyone involved.
Eh. It’s my own fault. It’s just too bad that some people (like ME) have to learn things the hard way long after the point when the proper action would have prevented it instead of believing the horror stories and acting accordingly.
In accordance with what people have said in this thread, I’m going to continue giving the dealer the benefit of the doubt for a while, anyway.
It looks pretty grim to me. As pointed out above, these guys don’t want to waste time, they just want your money, and you gone so they can sell another car.
The finance manager is trying to get you credit on terms that you will agree to. The system is the credit system, along with all finance companies involved.
His playing with it means that he hasn’t got an arrangement, and he’s trying to work something out. Anything.
If he isn’t in touch with you, as opposed to you having to call him, it makes me doubly suspicious that something may not be able to be worked out.
I would be firm with the dealer and say you will go elsewhere if he doesn’t get you an answer in the next day or two at most. While I admit I don’t know the ‘system’, I refuse to believe that in a computerized world, this isn’t a matter of typing in terms and getting results back. I presume he only has so many terms he can play with and some of them, like your maximum monthly payment, are a fixed value. So what variables are there other than length of loan, interest rate, and down payment (with the dealer already knowing that value, which is the most they would reasonably give you for your trade-in?) I think he’s stringing you along to make you desperate because of your bad credit, hoping he can hit you up with a very high interest rate or loan length. For anyone who has worked in the car industry, please tell me if I’m wrong and why…
What you’re describing is possible, however extremely unlikely.
Dealerships don’t really get to “set” interest rates. They have rates that they’re required to work within (according to bank regulation, state and federal laws), and some rates/plans will pay a signing bonus to the dealership itself, however those aren’t always the ones that more costly than any others.
As for “in the age of computers” – Ha! There are computer in car dealerships, yes. They’re almost all running Reynolds & Reynolds (Inventory Management & F&I workup), which was designed and is maintained by an IT department stationed firmly in the late 1980s, and don’t get me started on their Contact Management tools. At least the credit check software is relatively modern, and for many customers can be quick.
But if you run the check and you don’t have any, or many, green checks (which indicate approval), or your checks are all conditional (which means must provide “stips” which are verification that certain stipulations are met), you can be SOL, especially for bad credit, opposed to low/no credit individuals.
Stips could be, Proof of Income, Proof of Residency, Proof of Home/Cell Service, Proof of Employment, etc.
I think you’re right on the money here. He can string you along knowing the longer he does it the more desperate you’ll become and more willing to agree to compromising on the deal ie. putting more cash in his pocket via higher interest rate, longer terms, etc.
One idea might be is to forego the idea of a new car at this time, and spend a year fixing your credit. Order your credit reports, dispute anything which is very old, doubtful or simply wrong. Get a small CC, pay it religously.
Used car dealers can be quite unethical.* The used car lot at a new car dealer, or buying from a Private party may be a better deal. Check the BBB and Google your used car dealer, using the term “scam”, “ripp-off” etc as part of the search
Op, what sort of car are you trying to buy? Vague price range? What’s your trade in?
there are a number of local used car dealers that aren’t really interested in selling cars. What they do is a scam as follows: they sell you a car with payments you can’t afford, then they repo when you default, they then arrange to buy the car at auction for pennies on the dollar, then sue you for the rest. Too often you never get notice of the lawsuit, they hire a unscrupulous process server who “serves” a dumpster. So, to break it down: Sell you a $2500 car for $5000, collect $1000 down and $1000 in payments. “Buy” car from auction house at $1000, then sue for $4000 (the $1000 in payments were all interest). They end up with $6000 *and the car. * Rinse, wash, repeat.
O.k., Todderbob, I still don’t get it. Why would this process take several days? Obviously the dealer wants to make the most money on the deal, so he/she will maximize profit along the two variables I suggested, and possibly the third of screwing you on your trade-in value to get whatever incentives are in the other two categories. I know the dealer can’t set the interest rate, but presumably above a certain minimum, they have flexibility in how bad they want to screw you with a maximum interest rate. Presumably higher interest rates are better from the standpoint of the lender and I have to believe there are kickbacks to the dealer if they can get a customer to accept a higher rate. Even with 1980s software, this should be simple to determine. If there are ‘stips’ as you suggest, I would think those would be discussed up front with the customer to figure out which they can fulfill and which they can’t to remove unknowns from the equation as much as possible at the start. It would be in the dealer’s best interest to do so if for no other reason then to get rid of you if there is no possible way to make the sale happen.
What doesn’t make sense is to jerk the customer around and wait several days knowing they might go somewhere else, unless you have done such a good job of doing the “Obi-wan, you’re my only hope!” sales job that you have destroyed their self esteem.
DrDeth - your version sounds a little too conspiracy theory-esque in my opinion. If I’m the kind of guy who has bad credit such that I have to take the outrageous loan conditions to begin with, then I default after one month, why would I be sitting on a pile of money such that suing me for $4,000 would ever net you a nickel? In your scenario, if you don’t collect in the lawsuit (because I’m likely broke), yes, you still have the car and $1,000 for your trouble ($2,000 in payment - $1,000 to buy it back at auction). Meanwhile, someone else may get the car at the auction, or the car may decrease in value because I wrecked it before you got it back, in which case you lose money on the deal. That sounds a bit risky in my mind.
Ah, but you have a job. That’s why they lent you the $ in the first place. So, they garnishee your wages. And, with the downpayment they get and the payments, they can’t lose. Sure, it’s possible some outsider may outbid them at the auction- so? The car (in todays market) will still go for small dollars.
And, they make you have insurance, so even if you wreck it, they are good.
This has happened to at least two people I personally know here in CA.
Thats a Buy-Here, Pay-Here lot, garunteed. It’s almost impossible for what you said to happen working with an outside lender.
At a buy here pay here lot the car is financed privately, at Usury-bordering rates, installed with a GPS tracker and if you are 30 minutes late the car turns off, they pick it up, and file a suit almost immediately. They then, legally, must sell the car at auction, publish the times, and take the sale value of the car out of your debt.
In reality, they hold a private auction, with only thrum present, and buy all the cars for 20 bucks. You could attend the auction, but first you’d have to know where/when it is.
When dealing with a bank, the bank will not allow the dealer to arrange payments they don’t think you can make – period. Their profit isn’t in repo, it’s in payments. Banks almost always lose money on repos.
You don’t ask for stops up front, but you are supposed to ask what kind of stops can be met – at least I did and that’s how proper training dictates. On the other hand, most people are stupid, so it doesn’t usually happen that way.
Software doesn’t make the final decisions on loans, period. They can grant approvals (which banks honor) but they can’t make a person inelligable. You’d be surprised the number of obviously unqualified people who get cars based on rehashed deals. I’ve been party to dozens, if not hundreds of rehashes with lenders from Chase to Ford to Honda motor credit, and some GMs/F&I guys have more pull than others with the guys on the other end of the phone.
Update: Got hold of the dealer, found out that he just couldn’t put together a deal with the amount of downpayment I could pay upfront and the amount the lender insisted on. I looked at a couple of other cars, and we’re finalizing tomorrow on a 2005 Malibu Maxx with 65K miles on it. He could use a financing system (or something like that) that would allow me to pay the downpayment in installments over my next few paychecks. The monthly payments are within my range, so it looks good.
I’m hoping this at least kickstarts a recovery of my credit rating, too.
Thats against most lenders rules and regs (down payments in installments), but it’s to everyones benefit to overlook it – until it’s not. It almost certainly won’t come back to bite you in the ass (although it might bite the dealers ass). Just keep an eye out, because it’s a sketchy thing to do (although sketchy in a way that helps you).
Also, sorry to hear about the other car, good luck with this one.