Kutten Posted September 19, 2007 Share Posted September 19, 2007 On Friday, I went to the a local Texas dealership and got a $18,000 Driveout deal for 2007 Civic LX for my dad. But that day, they didn't have the car, so they had to get it from another dealership. So I gave them $1000 deposit and I went back to get the car 4 days later. In the meanwhile, when I went to my bank, I found a better new auto interest rate (2% less than dealership quoted APR), so I took the loan check from my bank to the dealership and they didn't give the car since I am not financing with them anymore, So is there anything I can do? I still have the paper I signed with the price, tax, total, depoist, etc. The manager said he assumed that I would finance with them. Thanks a bunch. Quote Link to comment Share on other sites More sharing options...
raymsixsix Posted September 19, 2007 Share Posted September 19, 2007 Hey Kutten, there are three ways that a dealership makes money on a car deal. They can make money on the car they're selling, they can make money on the car that is traded in, and they can make money on financing and insurance products that the customer buys. I'm not sure about the laws of TX, but it sounds like the car deal wasn't consumated yet. If the deal hasn't been consumated they can usually back out of the deal, just like you can usually back out of it. Mostly, to consumate a deal, there has to be a sale, financing of the car, and the customer has to take delivery i.e. drive it off the lot. They probably sold the Civic a lot cheaper than they wanted to, but knew they would make the money back by the higher APR. When you came back with your own financing, they weren't goin to make any money, so they decided to back out. I'm not a lawyer, nor am I trained in F&I. Anyone else that wants to jump in, go right ahead :D Hope this helps Quote Link to comment Share on other sites More sharing options...
nc211 Posted September 19, 2007 Share Posted September 19, 2007 Does the purchase agreement that both you and the dealership signed say anything about the price being contingent upon using their financial services? If so, then no, they have the right to retrade on the price. But if not, then yes, you can enforce the contract and make them honor the sales price. If they refuse, inform them of the "bait & switch" laws. Trust me, all you'll have to say to them is the term "bait & switch", and they'll know exactly where you're going with this, and be forced to honor the contract price as AGREED upon in writing, with both your signature and theirs, so long as that purchase agreement does not say the price is contingent on using their financial department. They won't sell you the car at that price anymore because their profit was in that 2% you avoided with the bank loan. They were going to get a kickback from the lender for selling you on a higher interest rate than normal. But to be honest, it can't be but a few hundred dollars at best. With 2%, and what, a 5 year term, on a loan of that size, you're not talking too much money. Might be worth coming up an additional $400 in your offer. You'll still be saving $360 a year with the bank loan. This was a Lexus dealership??? Quote Link to comment Share on other sites More sharing options...
option00002 Posted September 20, 2007 Share Posted September 20, 2007 Does the purchase agreement that both you and the dealership signed say anything about the price being contingent upon using their financial services? If so, then no, they have the right to retrade on the price. But if not, then yes, you can enforce the contract and make them honor the sales price. If they refuse, inform them of the "bait & switch" laws. Trust me, all you'll have to say to them is the term "bait & switch", and they'll know exactly where you're going with this, and be forced to honor the contract price as AGREED upon in writing, with both your signature and theirs, so long as that purchase agreement does not say the price is contingent on using their financial department. This is great advice. If the P & S is signed by both you/father and the sales manager with no mention of financing contingencies (which would be extremely rare) then they are by law obligated to hold up the deal. Particularly because you left a large deposit. They won't sell you the car at that price anymore because their profit was in that 2% you avoided with the bank loan. They were going to get a kickback from the lender for selling you on a higher interest rate than normal. But to be honest, it can't be but a few hundred dollars at best. With 2%, and what, a 5 year term, on a loan of that size, you're not talking too much money. Might be worth coming up an additional $400 in your offer. You'll still be saving $360 a year with the bank loan. This was a Lexus dealership??? The dealer receives a flat from the bank ($200-$300 on avg.) simply for funneling the loan to the bank. Any percentage points they hold from there on could conceivably turn that into a $400 - $600 deal and potentially more. This fails to take into account any aftersell you may have bit on. (e.g. life and disability, a warranty, lo-jack, autobahn etc.) whose exact number might have been fudged in the loan work. By eliminating the financing you may have really thrown them for a loop. This however does not nullify your P & S ^ so play the game and insist they honor the deal or you may contact the Better Business Bureau. .02 Quote Link to comment Share on other sites More sharing options...
smooth1 Posted September 20, 2007 Share Posted September 20, 2007 Or, you could take that contract to another dealer and play the " if you match it I will buy" and remind them of thier advertisements stating such. That piece of paper you have is exactly what they ask for when you go and try to price offer match. When you find a dealer that bites, get it, then drive it to the first one and tell them how your gonna tell every freind you have and post it on the forum about how they couldn't do their own deal, and " Mr. Smith's Dealership" could. Quote Link to comment Share on other sites More sharing options...
SW03ES Posted September 20, 2007 Share Posted September 20, 2007 I'd lean on the dealer using the information nc has given you. Quote Link to comment Share on other sites More sharing options...
option00002 Posted September 20, 2007 Share Posted September 20, 2007 This was a Lexus dealership??? I hope not as that would indicate it is a used car. $18k for a '07 Civic pre-owned without certification is no deal. I would assume this is at a new Honda dealer. Curious... Does out the door translate to: Sales tax, plates/title, doc. fee included? Quote Link to comment Share on other sites More sharing options...
elementau Posted September 20, 2007 Share Posted September 20, 2007 Just do the financing with the dealer and pay it off with the bank loan, Pain in the rear, but not really. Just make sure there's no prepayment penalty. Quote Link to comment Share on other sites More sharing options...
elementau Posted September 20, 2007 Share Posted September 20, 2007 Just do the financing with the dealer to get the price you agreed on and pay it off with the bank loan, Pain in the rear, but not really. Just make sure there's no prepayment penalty. Seriously, I've done this twice, once at a Chevy dealership in Indiana, then again at a VW dealership in Cali. This is assuming you have great credit. Even after you get the rate from the bank do a Lending tree inquiry. You'll get crazy stupid offers to buy off your loan, and in that final year when you only have a few thousand to go apply for a new credit card that says 0% for 1 year or when balance is paid off. I'm telling you, I've saved thousands this way. Funny I didn't do that with the Lex this time around. Quote Link to comment Share on other sites More sharing options...
smooth1 Posted September 20, 2007 Share Posted September 20, 2007 While I don't agree with what the dealer is doing here, the "backout" clause goes both ways. Just as you can walk in there and say I changed my mind, I want my money back, they can pull the offer and stop the deal as well. Only when you can no longer back out are they just as committed by law. I agree, you can go in there and make a case for the point of the matter, and appeal to thier business ethics, I think you will have to make alot of noise, and is it worth it? That's up to you. I still think you could take that contract to another dealer and get your car. That is after all the goal here right? Then I would take up the point of the matter seperately. Quote Link to comment Share on other sites More sharing options...
Kutten Posted September 20, 2007 Author Share Posted September 20, 2007 This was a Lexus dealership??? I hope not as that would indicate it is a used car. $18k for a '07 Civic pre-owned without certification is no deal. I would assume this is at a new Honda dealer. Curious... Does out the door translate to: Sales tax, plates/title, doc. fee included? Yes, it included Sales tax, plates/title, doc. fee. It was a Honda dealership. Quote Link to comment Share on other sites More sharing options...
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