Need Help on Dealer Finance for Buying New Car

LRawrkun on 03/01/2018 - 17:53
Last edited 03/01/2018 - 17:53

Hi guys, I'm new here and need some serious help. I've bought a new car recently and the dealer is helping me to arrange with the finance.

I've signed the purchase agreement with the option checked for the dealer to arrange my loan. The dealer came back to me a day after telling me that my loan has been approved but upon closer inspection, I realised that the interest rate seems to be rather high, and the dealership has also added an additional dealer facilitation fee of $770 and an establishment fee of $399. At this stage, is it mandatory for me to go with the finace that has been arranged by the dealer or could I still opt to arrange for my own finance..

Any input would be very much appreciated.

Automotive

Comments

  • [Deactivated] on 03/01/2018 - 18:09

    Ever heard of how car salesman are referred to in a bad light? Hmm

    Also, as this is a bargain forum, most people here will scold you for using finance to purchase a car in the first place.

    • freemoneyhunter on 03/01/2018 - 18:42

      Or new car….as soon as you drive the car out of the dealers, you lose 20% of the cars original value.

      • spackbace on 03/01/2018 - 20:03
        +1

        No you don't, unless your stamp duty amount is 20% of the purchase price.

        But it's a good yarn to spin

  • thatonethere on 03/01/2018 - 18:19

    Did you waive the cooling off period? You could try and back out but may lose deposit and costs.

  • freemoneyhunter on 03/01/2018 - 18:40

    I bet the dealer is at a fine restaurant tonight with a beautiful woman (while your walking outside in crummy clothing counting your change). $770? I thought they did all that for free so they could make a sale on the car.

  • demiurge on 03/01/2018 - 18:46
    +5

    A car loan is just about the worst idea ever on this forum. Now a loan whose terms you don't even see? That is the worst idea ever.

  • oscargamer on 03/01/2018 - 18:47
    +3

    tell the stealership to get a better rate, get rid of the facilitation fee and est fee or you'll go elsewhere…..

    • BobLim on 03/01/2018 - 21:00

      And early repayment penalties if possible

  • hawkeye on 03/01/2018 - 18:58
    +1

    If you didn't know about the $770 prior to signing that could be your loop hole out if it hadn't been stated.

  • spackbace on 03/01/2018 - 20:05
    +7

    Ok since no one above has answered accurately or provided any help…

    There is nothing holding you to the dealer finance… ever. Feel free to get other quotes, then either go with those quotes, or use them to bring the dealer back down.

    Everyone's financial positions are different, so it's gonna be hard to know if your interest rate is competitive for you or not.

    So feel free to get other quotes, they don't cost anything except time.

    Simples :)

    • tassieeagle on 03/01/2018 - 20:33
      +1

      Listen to this guy OP

    • oscargamer on 03/01/2018 - 20:55

      ok spack, which part of my answer was not accurate ?

      • spackbace on 03/01/2018 - 20:57

        By getting a comparison quote you have leverage. Asking/telling them to drop the rate won't be the same

    • tomleonhart on 03/01/2018 - 21:28

      Spackbace knows his stuff. Listen to this guy OP!

  • sweefu on 03/01/2018 - 20:12
    +1

    Mortgage broker here - I'm happy to provide a finance quote you can use to negotiate with the dealer. Feel free to PM me.

  • zonra on 03/01/2018 - 20:30

    I've signed the purchase agreement with the option checked for the dealer to arrange my loan. The dealer came back to me a day after telling me that my loan has been approved…

    OP, was it a sale contract? Did you get a copy? What are the terms and conditions on it?
    Did you put down any deposit?
    Lots of questions I know but it would help us understand the situation better.

    • spackbace on 03/01/2018 - 20:35

      OP, was it a sale contract? Did you get a copy? What are the terms and conditions on it?

      Sales contract is totally separate to the financial documents.

  • p1 ama on 03/01/2018 - 21:59
    +1

    At this stage, is it mandatory for me to go with the finace that has been arranged by the dealer or could I still opt to arrange for my own finance..

    To be honest, at this stage, it is smarter for you to find a cheaper car that you can afford.

    I can completely understand if someone wishes to redraw on their home loan, which is probably < 3.8% p.a. to buy a car but to consider getting a car loan is absolute madness. Just had a look on RateCity and the comparison rate on car loans are 6% (at the low end) up to over 8% (at the high end).

    I'm all for leverage and borrowing money, but to borrow money at rates almost twice the mortgage rate and buying something which depreciates markedly is a crazy, horrible financial idea.

  • Yttrium on 03/01/2018 - 22:58
    +1

    You are financially screwing yourself , by (1) buying a new car , (2) with a loan.

  • Rawrkun on 04/01/2018 - 09:13

    Thank you everyone for your reply. Was thinking that it would be more manageble splitting the repayment over 3 years rather than one lumpsump, the downside is I'll be paying in excess of $5500 for the loan interest and fees..

    As long as I'm not bounded to agree with the dealer financing option, I'll mananage somehow. Made a call to the dealer and he's being elusive about the finance detail and doesn't seem that trustworthy..

  • Foxtail on 04/01/2018 - 10:57

    Id be taking the 7day (Qld) cooling off period and walk.

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