In buying cars in the past, I’ve had dealers only allow a limited amount of the purchase on credit cards. Dealers are operating on a margin, and CC charges definately cut into their margins. I believe at the last place they only allowed $1000 to be put on the card.
They are breaking the rules of their merchant agreement. A quick search turned up this agreement, which is typical (this link is a 250k PDF): http://www.1stnationalmerchant.com/forms/Processing%20Agreement.pdf
Quoting from Paragraph 3:
- HONRING CARDS: Merchant agrees to follow the procedures for card acceptance set forth throughout this merchant agreement in connection with each Card Transaction and agrees to fully comply with and abid by all applicable Rules… © Shall not establish minimum or maximum Transaction amounts as a condition for accepting cards
Although some parts of the merchant agreement undoubtly are rules with a particular merchant bank, the “HONORING CARDS” section is straight from Visa and Mastercard, and should be the same in all agreements.