I know what we all all get from assuming..But to me this is weird...I chose to finance thru Lexus, which I really should have stayed with my credit union as it has 1.9% ..ANYWAY.. My insurance company wanted to know the address...ASSUMING it was Lexus Financial (not sure why they dont just use Toyota Financial) I talked to the dealer this morning and was told to send it to PNC Bank in Pittsburg PA..ANYone else experience this? Just seems weird to me..Then to top it off, whoever sent the check to pay off the car I traded made the check out to Plymouth Security Credit Union.. I have never in my life ever heard of that .., so now "they" have to overnight the correct check, which BTW came from Bank of America....Go Figure.

 

It sounds like your dealer did not actually use Lexus Financial - instead a more profitable deal for him. Do your documents show LFS? I know dealers have different sources for financing but they should not have presented the deal as LFS if they were using someone else. I've leased cars from LFS for 15 years and have never seen an arrangement like this when the deal was with LFS. This sounds more like the way mortgage lenders operate.

Dave Mac

 

It does say assigned to PNC bank... Im surprised Lexus allows that.. But Im no financial expert.

 

Dealers can use financing other than LFS (LFS and TFS are the same company). My dads 98 LS was leased through a bank in Alabama.

Not always because of profit, sometimes another bank has better terms. Right now they have to swap the low LFS finanicing for the rebate, if they finance it elsewhere perhaps they got you a better rate and got you the rebate.

 

It's not a good rate..

 

What's the rate?

 

I had 1.9% from my credit union. This one in 2.54%

 

2.54% is not a "bad rate" LOL.

If you had 1.9% from your credit union you should have taken that. You had plenty of time to make that decision when faced with the difference.

In any event, thats what happened I bet. You either get the 1.9% from LFS or you get the $3,500 rebate, in this case they got you 2.54% from PNC and were also able to give you the $3,500 rebate, the $3,500 is worth way more than the .64% interest rate hike. If you had better financing available to you, you should have used that. Did you not ask what the finance rate was from the dealer before you signed the paperwork? If you didn't...thats on you.

The difference on a 60 month loan on a $40,000 loan amount of the .64% interest is $654 over the entire lifeof the loan, so I wouldn't beat yourself up too much.

The check used for your payoff was just an error. Why is it surprising that check came from Bank of America? Thats obviously who the dealership uses to do their banking. My dealer uses SunTrust, I know because I got a rebate check for a $100 or so I was overcharged for tags and it came from Lexus of Rockville and was a SunTrust check. When your dealer buys your trade, thats a transaction with the dealer, so they pay that off not Lexus.

At the end of the day, who cares who the bank is? You're paying less interest than you would have been paying had you financed it through LFS on a non-promotional rate to get the rebate.

 

I got it refinanced thru the credit union already.. 1.9%.....I dont care who it is. Id just think LFS would like their own dealers to use them.

 

Of course they would, but they don't have to use them. Good finance managers at a dealership know what other options are out there for customers or situations that mean the company's captive financing arm isn't the best fit. This is one of those situations. This $3,500 rebate I don't believe is compatible with any LFS financing, for sure not a promotional rate like 1.9%, but it may be NO LFS financing at all, which means if they are going to provide financing to people they need options other than LFS.

In some situations it may also be that for a certain customer's credit profile, i.e. they aren't Tier 1 or Tier 1+, or their company is buying or leasing the car, they don't have a US SSN, there are lots of scenarios, that the dealer's captive financing company doesn't offer the best product for that particular customer, so they need other options too.

Dealerships are independent businesses, they each approach their business differently. What the franchisor wants and what the franchisee feels is the best approach for them is very commonly not the same. Take it from somebody who owns a business that is operated under the umbrella of a "mother company", they want me to do stuff a certain way or use their vendors for things and I commonly say no because its not in my interest or my clients' interest.

 

I got a good deal on the car for sure, course the 3500 is a Lexus incentive, the dealer added another 2k to that..so that was good and he gave me what i asked for the trade..Ill just re finance thru my CU and get the best of both worlds...

 

Most of the time dealer financing never benefits the customer. I choose my local credit union instead.

 

I normally do also but took the $3,500 cash and ask them to match the credit union rate and they did (1.9%). I received the paperwork yesterday and filed for a refinance through Western Federal Credit Union with 0.74% (with automatic payments) for three years and was approved last night pending final paperwork. Will not be paying anything with 0.74% off early, lol.

Remember, you can almost always refinance with your credit union at a lower rate after you get the car. Most places let you refinance as long as the car is 1 to 2 model years away from current year and under so many miles on the odometer.

 

Yep thats what Im doing.. Going to DMV Monday to register the car and get title and tags.. then as soon as I get the paperwork from who they are using, im going to my credit union and refinance it.Im doing 5 yrs. as my payment is lower but at same time doubling payments..If something comes up I dont HAVE to double it if I dont want to.

 

As confusing as these transactions are, I think you did a great job of sorting it out and getting the most for your money. Rebate + low percentage = lots of money in YOUR pocket...
Do the double payments and you'll be finished before you know it. A very nice feeling to make the final payment on your ride...