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danilo
Member since Nov 2008
5829 posts

Buying a car with cash
Looking to buy a new car from dealership (Toyota Carolla). I may pay with cash. Does paying with cash impact my leverage when negotiating the price?
This post was edited on 11/27 at 9:56 am


hungryone
LSU Fan
river parishes
Member since Sep 2010
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re: Buying a car with cash
Generally, no. Dealership may have incentives tied to financing.....sometimes, you can get a better deal by taking the incentives that come with financing, then paying off the loan in full after 2-3 months. (Assuming that the loan terms do not require a minimum number of payments in order to make the deal.)


danilo
Member since Nov 2008
5829 posts

re: Buying a car with cash
quote:

Generally, no. Dealership may have incentives tied to financing

I had a hunch that’s way it is. Thanks.


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gobuxgo5
Ohio State Fan
Member since Nov 2012
7536 posts
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re: Buying a car with cash
It makes it much harder for them to make money on the back end so it's usually an annoyance for them.


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150
castorinho
Oklahoma Fan
13623 posts
Member since Nov 2010
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re: Buying a car with cash
Negotiate the price without indicating how you're going to pay. Just focus on the price first,and only the price.



Chad504boy
New Orleans Saints Fan
Member since Feb 2005
136028 posts
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re: Buying a car with cash
so how much a month can i get you in this ride?


632627
Southern Cal Fan
LA
Member since Dec 2011
9192 posts

re: Buying a car with cash
quote:


Negotiate the price without indicating how you're going to pay. Just focus on the price first,and only the price.


That won’t work if there are different rebates tied to purchase/payment method (unless you strictly specify negotiation is limited to dealer discount only).


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makersmark1
Auburn Fan
earth
Member since Oct 2011
7644 posts

re: Buying a car with cash
Buy a used car.

They are all used when driven off the lot.


jimbeam
USA Fan
University of LSU
Member since Oct 2011
57845 posts

re: Buying a car with cash
Precisely the reason I buy used underwear.


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221
PhiTiger1764
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re: Buying a car with cash
quote:

Negotiate the price without indicating how you're going to pay. Just focus on the price first,and only the price.

I feel like he should do the opposite. Let the dealership know you want financing and negotiate on monthly note. Say you want the vehicle as cheap as you can get it.. but then get into a note with some crappy terms so the dealer thinks they will make their money. Then just pay off the loan in full a short time later.


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castorinho
Oklahoma Fan
13623 posts
Member since Nov 2010
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re: Buying a car with cash
quote:

so how much a month can i get you in this ride?

The four squares!


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50
danilo
Member since Nov 2008
5829 posts

re: Buying a car with cash
quote:

Buy a used car. They are all used when driven off the lot.

I am looking for a Toyota Carolla or a Honda Civic. I see very little difference in price for a new vs year or two old with 25k miles. I figure I might as well pay 2k more and get a new one


632627
Southern Cal Fan
LA
Member since Dec 2011
9192 posts

re: Buying a car with cash
quote:


I am looking for a Toyota Carolla or a Honda Civic. I see very little difference in price for a new vs year or two old with 25k miles. I figure I might as well pay 2k more and get a new one


Toyota and Honda hold their value reasonably well on the used market so you’re correct that you may just be better off buying new and getting the full factory warranty along with any special interest financing (captive rates typically better on new than used).

Luxury cars with the crazy depreciation are best purchased used.


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71
Mr.Perfect
LSU Fan
Louisiana
Member since Mar 2013
16817 posts

re: Buying a car with cash
This is 100% the way to go


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castorinho
Oklahoma Fan
13623 posts
Member since Nov 2010
64698 posts
 Online 

re: Buying a car with cash
quote:

I feel like he should do the opposite. Let the dealership know you want financing and negotiate on monthly note. Say you want the vehicle as cheap as you can get it.. but then get into a note with some crappy terms so the dealer thinks they will make their money. Then just pay off the loan in full a short time later.
not really. Just because you tell him you're going to finance doesn't mean he's going to give you the best price and just screw you on the interest. He can screw you on both.

You negotiate price first. The when you tell him you'll pay cash and he tries to convince you to finance, then you can get tell you'll finance if he comes even lower on the price. Then you can take the incentive and pay it off a month or two after.


Jjdoc
Columbia Fan
Cali
Member since Mar 2016
24968 posts

re: Buying a car with cash
Why not negotiate the price, give them the a down payment amount that you are thinking.

They give you all the deals.... rebates etc ..

Then before signing say you came up with a larger down payment. Say 75% of what you were wanting to pay in cash.

Still have the financing... Still get the rebates...less interest paid.

??


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tarzana
LSU Fan
TX Hwy 6, 74 miles SE of Kyle Field
Member since Sep 2015
15021 posts
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re: Buying a car with cash
quote:

vs year or two old with 25K miles

I learned about that the hard way through trial and error.

I bought a used 1994 Toyota Corolla (back in 1995) from Enterprise Car Sales. It had 26K miles and still was under the factory warranty for 9K more.

Well, it proved to be a lemon and by 88K it was undriveable. Even with an engine overhaul it couldn't pass emissions inspection and the apartment management kept threatening to tow the car off the property unless I got a valid sticker!

Bottom line, buy new...even if you have to finance it.


Jag_Warrior
Virginia Fan
Virginia
Member since May 2015
1174 posts
 Online 

re: Buying a car with cash
quote:

I learned about that the hard way through trial and error.

I bought a used 1994 Toyota Corolla (back in 1995) from Enterprise Car Sales. It had 26K miles and still was under the factory warranty for 9K more.

Well, it proved to be a lemon and by 88K it was undriveable. Even with an engine overhaul it couldn't pass emissions inspection and the apartment management kept threatening to tow the car off the property unless I got a valid sticker!

Bottom line, buy new...even if you have to finance it.


One bad experience 25 years ago really doesn't make a rule. I don't know if you had that car checked out and maybe that wouldn't have saved you anyway. But people who always buy new and finance are setting their money on fire with every transaction. I love cars. I've had a bunch over the years and I have a bunch now. But unless you're (successfully) playing in the collectible market, you'll seldom come out ahead. About the best you can do is try to lessen your losses when it comes to depreciation. And a *well maintained*, highly ranked 2+/- year old used vehicle is generally the best way to do that.

Buying used has never scared me. But I have a great mechanic that thoroughly checks out any used vehicle that I'm considering. If you can get a super deal on a new one, that's fine. And buying the odd new car every now & again can work if you're not one of those "trade for new every three years" types. But for average grocery-getter/daily drivers, I have many other things that I'll waste my money on.


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TigerintheNO
LSU Fan
New Orleans
Member since Jan 2004
32265 posts

re: Buying a car with cash
quote:

Looking to buy a new car from dealership (Toyota Carolla)


Last year my wife was planning to buy a Toyota from their dealership in New Orleans, with cash. When I walked into the office I saw a credit card machine on his desk. Asked if I use a credit card without any fees, he says no fees up to either 7 or 8K.

Figured why not, I can keep some of my cash for another month and get thousands of miles.


hungryone
LSU Fan
river parishes
Member since Sep 2010
10048 posts
 Online 

re: Buying a car with cash
I did the same: paid the down payment in CC to collect the miles, paid off CC the next day. Took out a dirt cheap loan w USAA over 24 mos. interest over the life of the loan was something like $125. Well worth it to keep my cash working elsewhere instead of having morbid fear of debt/a monthly note.


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