Why are my elderly friends bullied into credit deal?

AnotherJoe

Deleted_User wrote: »

It's the fact of life at the moment were old folk get taken for mugs by all trades. I suggest your 70 year old friends take someone younger with them next time to help close a deal.

A salesman will be less likely to spurt !!!!!!!! when someone on the ball is also present.

As long as its been clearly explained they can get the discount by taking the finance and then paying it off, they arent being taken for mugs but getting best advice.

Imagine the scenario the other way round.

The OP posts "my 70 year old friends have been taken for mugs. They went into a dealership and were sold a Focus for £14k cash when they could have got it for £12,500 simply by signing a credit agreement, getting a big discount from the Ford credit company and then paying off the agreement the next week!"

(all numbers made up of course)

And yes get them to look at drivethedeal and carwow.

Hotspur

If they know what they want then walk away from the dealer and use a broker who will give a cash price. In addition to the above mentioned Drive the Deal and CarWow have a look at Carfile

Many brokers will also arrange to take a car in px. Payment is made directly to the main dealer supplying the car just as if you walked into the dealership.

Iceweasel

Buying a car for cash is unlikely get your friends any discount.

Discount is a dirty word these days.

What to do is take the finance deal and then settle early - that usually gets the best price.

I wrote this in reply to a poster in another thread:

Be careful to use the correct words in this game of price reducing.

Do not use the word 'discount' - no-one gives discount - they give 'contributions' and 'incentives'.

And don't talk about cancelling any finance deal - cancelling may mean that you have to return the incentive.

Of course you have the legal right to cancel -but what is better is to just pay it up - so the correct term is to 'settle' the finance early. I paid interest on only 4 days.

The dealer and/or the manufacturer should be able to give a 'contribution' towards the purchase and the finance company will likely offer an 'incentive'.

ic

Aren't most finance deals flat rate, so the interest for the term is added on at the start of the loan? Pay off early and you save nothing because the full interest amount must be repaid in addition to the value of the loan? Has this changed, or can this be avoided by paying off during a cooling off period at the start?

neilmcl

ic wrote: »

Aren't most finance deals flat rate, so the interest for the term is added on at the start of the loan? Pay off early and you save nothing because the full interest amount must be repaid in addition to the value of the loan? Has this changed, or can this be avoided by paying off during a cooling off period at the start?

No, flat rate interest loans are the exception rather than the rule. Most, if not all main dealer finance is calculated using APR rates.

Ectophile

ic wrote: »

Aren't most finance deals flat rate, so the interest for the term is added on at the start of the loan? Pay off early and you save nothing because the full interest amount must be repaid in addition to the value of the loan? Has this changed, or can this be avoided by paying off during a cooling off period at the start?

If you take out a credit agreement, you have 14 days to change your mind and cancel the agreement.

So the trick is to buy the car on credit, then once you've driven home from the dealers in your new car, you phone the credit company to tell them you've changed your mind.

You still have to pay for the car, though.

Blackavar

Although I really hate all the stupid ' theatricals' around this process, and although not a youngster myself, I will certainly try and be with them when they've identified exactly what they want(nothing much wrong with their Mondeo but they just want a new car and have the cash, so if it makes them happy....), plus I'm not sure if a Focus is the way to go but their choice although I'm madly researching alternatives they might like maybe Seat or Skoda but they are old Skool and want to stick to major brands.
Having read through all the replies (and thanks very much for this - really appreciated) I think that they may need to agree on a finance deal and then settle this shortly afterwards.
I guess any additional discount could be negotiated around the Mondeo they are trading in?
I just hate the 'can we get more for our car?' and the guy says he has to ask his boss but just stands round the corner ......

[Deleted User]

AnotherJoe wrote: »

As long as its been clearly explained they can get the discount by taking the finance and then paying it off, they arent being taken for mugs but getting best advice.

Imagine the scenario the other way round.

The OP posts "my 70 year old friends have been taken for mugs. They went into a dealership and were sold a Focus for £14k cash when they could have got it for £12,500 simply by signing a credit agreement, getting a big discount from the Ford credit company and then paying off the agreement the next week!"

(all numbers made up of course)

And yes get them to look at drivethedeal and carwow.

The way I read it, the dealer has told them they simply can't buy a car for cash and that they must take out credit. Obviously to suit his commissions and not the needs of the customer.

neilmcl

Deleted_User wrote: »

The way I read it, the dealer has told them they simply can't buy a car for cash and that they must take out credit. Obviously to suit his commissions and not the needs of the customer.

I'm betting that's not what was said at all. Yes sales will always steer you down the finance route but if they wanted a cash only price they would have been given one. As I said earlier the conversation was probably along the lines of 'you can't have that discount price unless you take the finance".

NBLondon

You have to read the finance paperwork carefully but you might be able to do what I did to Ford Finance about 5 years ago. I had the cash ready, but there was a "nothing to pay for a year" finance deal on the table so I could put 50% down; put the rest in a savings account gathering interest and then settle a week before the payments and interest kicked in. Or if there's a 0% interest deal - put the cash in a separate account to earn interest and standing order the payments - then again settle just before the deal runs out.