Does anyone want to share their dealership's questionable finance tactics?

Did the dealership push add-ons like extended warranty, leather protection, rim insurance, Lo-Jack etc.?

Lexus of Serramonte in March 2012.

- Dealership claimed that a credit application need to be filled out even when paying by personal check due to the "Patriot Act" for the "DMV Paperwork."
- Dealership claimed that anti-theft stickers were ~$500?!? and could not be removed since they were already applied?!?
- Dealership tried to request for a Cashier Check on a Saturday evening at 6 pm or come back with a Cashier's Check on Monday?!?
- Dealership tried to do a "5 day loan" with no credit check for 20% APR?!?

Verdict:

- Refused to fill out credit application.
- Paid via Personal Check.
- Used Drivers License for "DMV Paperwork"
- Dealership waived off fee for "anti-theft" stickers

 

Yes to the credit application, I had fill it out. But I said no to all the add-ons, they were trying very hard to make me get the rim insurance and other stuff.

Funny thing is, I told them that I will put 75% down (cash), pretty much the full cost of he car. Why should I need to fill out the credit application? Their answer was, it has to be done anyway, it's their policy.

 

I've purchased Lexus Vehicles at different dealerships. When paying cash/check for the entire vehicle a credit application isn't necessary but one of the dealerships made me fill one out. Beware of these finance tactics at any dealership and always remember they are not your friend.

 

I was skeptical about the tire and rim insurance and it was like $1200 and when I refused it was offered at $800 and I took it. It was the best $800 ever spent. Living in Brooklyn, the potholes and terrible roads destroyed the first rim and tire within the first 1000 miles. They replaced both(paid for itself right there). Happened twice more with no problems with replacement. I would buy it next time at $2000.

 

If you do not use their finance service you don;t have to fill any credit application. Why would you fill one if you don;t apply for credit?! Doesn;t make any sense.

 

I do finance in the auto industry. It is common practice to do atleast a "5 liner" credit app on any cash paying customer. Yes it is needed to gather all your basic info properly for DMV. Or would you rather scribble your DOB social and address on a blank sheet for them ? They shouldnt run your credit unless its 6pm, you are paying with a personal check and they cant verify the funds so you can take the vehicle that night. Its a business and profit is not a bad word. If you feel like you're being taken for a ride then walk away. Extended mechanical coverage, tire/wheel insurance, and lojack are all great products if you ever are in a bind where the car needs service or has been stolen. The car business isnt what it used to be where they would sell you an empty promise. The policies that are offered actually work for you.

 

To echo what ISF George said above, there is a reason for the credit check when paying by cash/personal check.

If they accept a huge personal check and let you drive off with the vehicle, they put themselves at a lot of risk. You could stop payment on the check...the check could bounce. There is a huge opportunity for fraud. They are essentially letting you leave with the vehicle and they won't get their money for several business days afterwards. Without a credit check they have no idea who you are.

If you had a cashier's check that would be a different story. I bought a Lexus cash once and it was the same story. I protested and they ultimately let me go without the app (didn't want the credit inquiry for no reason), but I can 100% understand their position.

This is why they suggested you come back with a cashier's check, and why the "5 day loan" was suggested. They are looking for ways to let you take delivery of the car before your check clears without putting themselves at undue risk. High interest rate is due to the high risk of a loan with no credit check. Ultimately they let you go to make you happy, but they took on a LOT of risk by doing that.

Many times when dealing with dealerships if you take a step back and look at the situation objectively, you see that is isn't as one sided as you assume it is in the moment.

 

I think some of the services they try and sell you are worthless. The paint sealant, leather treatment, and things of this nature. Even the service maintenance plans are over priced. If you don't mind paying more for what you could just get for less when it needs to be done then it's your prerogative. However, it's much easier for most to hit discount tire up for a tire rotation a couple blocks away or do an oil change instead of driving 30 min ea way and spend more just because it's the dealership. Ive even found that more care is often taken now days at these specialized stores than the dealer. It's underwhelming when I look into the service bay at the dealership and see mechanics just kicking things around like the lift mounts under a car and hitting the rocker panel with the lift.

Every dealer is different and some better than others. The finance departments often don't like to take the time to explain their reasoning and will just bully unknowing customers into doing what they want them to do. I think we've all had this happen and the sooner you figure out that you have the power and not the dealer, the better off you will be. It's often difficult because you get sucked in on the idea of having that shiny new car. This is why it's always better to just try and work everything out mostly over the phone as it save you time and lowers the number of industry games or tactics they like to use.


I think with tools like the forums here, if you make yourself aware of the deals and incentives that are available you can talk with the dealer more intelligibly so that you know where they are price wise and know that the incentive money from the manufacturers is on top of the deal that you are being offered. When I leased mine back in April, I originally backed out because $$$ wasn't right and the car wasn't there yet. Once it did come in, I ended up getting them down by about 150/mo on the lease simply by having my sales guy go back and forth with the finance guys. They got the number down to $1.50 away from where I said I wanted the monthly payment and I still said that's great work, you're a $1.50/mo away from me coming down and signing the paperwork now.

It's stressful and fun at the same time if that makes any sense. Partly I suppose because I've acclimated myself to be ok with walking away and starting over somewhere else.

 

Just say no. I've certainly had dealers put the pressure on to try and sell me this stuff, but never a Lexus dealer...and I've bought from 3 different ones.

In looking at the OP's original post, where the dealer made a mistake was when they weren't just upfront with him about why they needed the credit check, they tried to explain it away as some weird thing instead of just being straight with him. In my situation they were straight with me, and it made sense. BUT, I had driven 50 miles to pick up the car and they knew I was paying by check and didn't tell me the issue. I could have easily gotten a cashier's check but by that point it was too late, so they wound up taking me at my word and letting me go.

 

It's not like they wouldn't have some means of finding you though had it not cleared. The probability of someone being dumb enough to attempt something fraudulent like this puts a lot at stake. And I think we can agree, in business you get to a point where you read the type of clientele you are working with. If something is off or is sending flags up, it's apparent. Not to mention if you have built rapport with them in advance.

 

The truth is, yes people are that DUMB. Fraud/theft will happen if those measures werent in place. Wait let me rephrase that. Fraud/theft still happens with those measures put in place. Also those backup contracts at 20% never really get sent to a bank. Its just a security measure for the dealer. No such thing as a 5 day loan because the dealer would not get paid on that anyway. I normally do a backup contract at a realistic rate and sometimes customers actually end up financing the vehicle through me. Just gotta be straight forward.

 

When I purchased my last Lexus (13 months ago) I wrote a personal check for the full amount and drove off with the car. No credit application or check. No SSN. It was 9:00 PM on a Friday. So, not all dealerships insist on a credit application and when I pay cash I won't fill one out.

The dealership probably has my information on file and can run a quick credit app without me signing anything.

 

I had the same experience, although I put the first $5k on my Amex card to get the FF miles.

 

You just can't blame them for having these policies in place. Asking someone to accept a $60,000 personal check is a lot to ask.

You can't make a new policy for every customer, and if you have different policies for different customers you open yourself up to discrimination suits, etc.

Its just good business to have a policy and stick to it, and I don't think requiring a cashier's check or a credit app for a personal check is bad policy when dealing with these types of dollar amounts. But, you have to tell the customer upfront to bring a cashier's check or you have to do a credit app or hold the car until the personal check clears. You can't spring it on them when they get there.

Show up for a real estate settlement with a personal check and see what happens. I have never seen a title company that will accept a personal check for more than $1,500 towards a real estate settlement.

No they can't, and why would you want them to be able to?

 

I think the policies should be clearly stated and held across the board. But customers also do develop relationships from repeated purchases with dealers as I have in the past and in those cases you sometimes can get past the standard practices.

A house isn't something I get a new one of every few years. Thank God!