Why are my elderly friends bullied into credit deal?

bigjl

bod1467 wrote: »

With finance the dealer IS getting "cash" straight away ... as well as a kick-back for arranging the finance. Hence why they push finance.

I think you will find that most if not all of any commission from arranging finance will be offset against the deal.

Dealers often make next to nothing on a new car sale. Often offsetting the various bonuses to win the business with the hope they can make a little bit on the trade in (if there is one) and get the lucrative servicing from the buyer.

neilmcl

bod1467 wrote: »

With finance the dealer IS getting "cash" straight away ... as well as a kick-back for arranging the finance. Hence why they push finance.

Just not true. They "push" finance because this is the only way for some (if not most) customers to actually afford to get into a new car. Volume is the driving force, and customer retention, plain and simple.

Andrew_Ryan_89

Yip for everyone, you can cancel ANY credit agreement within 28 days WITHOUT penalty. I got a big discount on my car taking out finance but cancelled and paid it off the week later.

AnotherJoe

Andrew_Ryan_89 wrote: »

Yip for everyone, you can cancel ANY credit agreement within 28 days WITHOUT penalty. I got a big discount on my car taking out finance but cancelled and paid it off the week later.

It might be picky but you didn't cancel it, you settled it. Cancelling it would lead you liable to repay any "contribution" (aka discount) paid by the finance company.

neilmcl

Andrew_Ryan_89 wrote: »

Yip for everyone, you can cancel ANY credit agreement within 28 days WITHOUT penalty. I got a big discount on my car taking out finance but cancelled and paid it off the week later.

Unless it has changed that would be 14 days not 28.

neilmcl

AnotherJoe wrote: »

It might be picky but you didn't cancel it, you settled it. Cancelling it would lead you liable to repay any "contribution" (aka discount) paid by the finance company.

No, he may well have cancelled it. Despite the fear mongers most dealer/manufacturer contributions are honoured when cancelling finance during the 14 day period. I was even told (unofficially) I could do that by the finance guy at a dealership on my last purchase.

agrinnall

neilmcl wrote: »

Just not true. They "push" finance because this is the only way for some (if not most) customers to actually afford to get into a new car. Volume is the driving force, and customer retention, plain and simple.

I'm not convinced by this, if it was the case then the OP's friends wanting to pay cash would not have had the finance hard sell. There must be some incentive to the dealer to push finance otherwise they wouldn't do it so assiduously.

neilmcl

agrinnall wrote: »

I'm not convinced by this, if it was the case then the OP's friends wanting to pay cash would not have had the finance hard sell. There must be some incentive to the dealer to push finance otherwise they wouldn't do it so assiduously.

Well clearly they'll always prefer to push the finance route because a) they are pushing their own manufacturer based products and therefore this will have advantages to the dealership as a whole, rather any individual "kick backs", and b) PCP almost guarantees repeat business. But at the end of the day they definitely wont turn down a sale just because the customer is offering cash.

Andrew_Ryan_89

neilmcl wrote: »

No, he may well have cancelled it. Despite the fear mongers most dealer/manufacturer contributions are honoured when cancelling finance during the 14 day period. I was even told (unofficially) I could do that by the finance guy at a dealership on my last purchase.

When I initially called to "settle" my agreement, the lady over the phone quoted my the cost of the car and the full interest. I had to have a little go with her. She checked with an supervisor then I just paid of the car. Easy trap for people to fall in to

chiny

Well... as an old git, I was expecting to buy my new car with cash but clearly that is so last century. On Carwow, checking 4 separate cars (20 prices) gives, without exception, a cheaper price with "finance".

Normally I would just look at the final cost payable as (a) cash (b) finance, then go for the lowest outturn cost but maybe I am missing the point. What is "finance" anyway in this context - PCP ?

Fascinating thread; thanks to all contributors.