Dealer insists on Bank Transfer

AndrewAllison

Hi All,
It's been a long time since our last big purchase but due to lots of things that have gone on we decided to treat ourselves to a flashy newer car. We went and looked and found the one we liked then put the deposit down.

issues then started. Firstly TSB had their complete meltdown so we couldn't get the loan money into the current account. Finally got it there and the guy from the garage said there was a spring broke and the car wouldn't be ready. This started doubts in my mind about spending 12k on a car.

Things then got further complicated when the dealer said they will only accept a bank transfer and it needs to be cleared before I can pick the car up. I would prefer to do a debit card payment once I've re-inspected the car but the guy says its there policy to only take deposits by card.

The car was 1k cheaper than any similar models I could find locally and is the only one near us with the right miles, spec and color.

Am I just being paranoid? Obviously I've stalked the garage on the web and found nothing but glowing reviews. I even checked them out on companies house and they look legit. I read a few articles that say this is a pretty standard way to do things now. I'm i Just an overly cautious person?

Any advice much appreciated.

glentoran99

If you have paid deposit by card you have the same protection as if you paid the full amount,


Credit card rather than debit card though

System

AndrewAllison wrote: »

Things then got further complicated when the dealer said they will only accept a bank transfer and it needs to be cleared before I can pick the car up. I would prefer to do a debit card payment once I've re-inspected the car but the guy says its there policy to only take deposits by card.

I can see no problem with this, he gets to save a bit of money on transaction fees, you're in no different position than if you pay by debit card. If you pay by debit card you have the same protection as if you pay by cash or bank transfer. You only have additional protection if you pay some or all of the amount via a credit card, they say they only take deposits by card so even if the deposit was £1 on credit card you'd have Section 75 protection for the full amount. Not seeing the issue here at all.

missile

I guess his is a "new" to you second hand car?

This is normal practise.
Perfectly reasonable to expect cleared funds before he releases the car.
It is possible to arrange a BACS transfer which can be (almost) instantaneous.
Very few (if any?) dealers will accept £12 K by credit card. The fees are expensive.

[Deleted User]

The transaction fee on a debit card should be the same no matter if it's £100 or £10,000.

unholyangel

Tarambor wrote: »

I can see no problem with this, he gets to save a bit of money on transaction fees, you're in no different position than if you pay by debit card. If you pay by debit card you have the same protection as if you pay by cash or bank transfer. You only have additional protection if you pay some or all of the amount via a credit card, they say they only take deposits by card so even if the deposit was £1 on credit card you'd have Section 75 protection for the full amount. Not seeing the issue here at all.

Sorry but the first half of that is incorrect.

Firstly, the fees for debit cards or BACS will either be the same or within a few p of each other (with no rule as to which one will be more expensive but they will be within coppers of each other).

Secondly, if you pay by cash or BACS there is little to nothing you can do if anything goes wrong or you make a mistake. With debit card, you have the option of chargeback. Chargeback isn't as good as section 75 protection but its still a lot better than the protection you'd get paying cash or transfer. It needs to fit into one of the reason codes set by visa/mastercard but it can be used for transactions under £100 (think mastercard have a £10 lower limit and visa has none - could be the other way around). So chargeback can offer protection even in circumstances section 75 can't (where the item value is below £100).

Rule of thumb:
Item value < £100 = credit or debit card for chargeback protection
Item value > £100 = credit card for section 75 protection (although as you say, doesn't matter how much you pay by credit card, as long as the item itself is over £100).

Also be wary paying through paypal and other third party sites as that can break the necessary debtor > creditor > supplier link for section 75 to work.

[Deleted User]

Just the used car dealer being awkward. I paid for my last used car deposit and balance (£2K) by debit card and the dealer was happy to take it.

neilmcl

Deleted_User wrote: »

Just the used car dealer being awkward. I paid for my last used car deposit and balance (£2K) by debit card and the dealer was happy to take it.

Paying the balance of £2K over a debit card and £12K is a bit different. For a start the bank's branch would probably require contacting first to confirm the transaction. Paying by bank transfer is so much easier for both parties so I really don;t see what the issue is.

Le_Kirk

Usual rule with bank transfers to a new person for the first time is to transfer £1 and, when it has safely arrived, transfer the balance.

motorguy

Deleted_User wrote: »

Just the used car dealer being awkward. I paid for my last used car deposit and balance (£2K) by debit card and the dealer was happy to take it.

I wouldnt say hes being awkward - its probably based on experience. Large debit card transactions on the day may be blocked by the bank so what might at first glance appear to be a few second transaction can become problematic. If it fails, you're then left with an irate customer and no money in the bank.

Cleared bank transfer in advance = no problem.

[Deleted User]

neilmcl wrote: »

Paying the balance of £2K over a debit card and £12K is a bit different. For a start the bank's branch would probably require contacting first to confirm the transaction. Paying by bank transfer is so much easier for both parties so I really don;t see what the issue is.

Putting a debit card into the slot and pressing 4 numbers is easier than logging into online banking, setting up a new payee, probably with the use of one those dreadful keypad things, double and triple checking you have typed the correct account number... nah.