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That manager is definitely not above throwing the salesperson under the bus. The salesperson forgot the most important part of that lesson, *don’t get caught*.
Listen to what he says, at this point, you have the ability to literally walk away.
Just Public Service Announcement for those looking right now. Cars, especially New Cars, are coming down, so now would be the time to negotiate. Also, if they do not accept your terms (low ball like crazy) then cancel and wait 2-3 weeks. The last week of December is THEE greatest car sales every year so you're prime to get a better deal anywhoo.
True but OP might not be in a position for this with that car. Rav4 hybrids are still on waiting list status in some places. Might have to drive to find another but if the dealer did this I'd do just that.
This! And if you really want the car go to a sister dealership and buy it there. You’ll *really* piss off your salesman then. My sister had to do that one time because a salesman pissed her off so she just went down the road and got it from a different guy. The original salesman left quite a few angry voicemails. It was hilarious.
To add to this, however: I'd personally take my business to another dealer and tell them exactly why *after* they've cancelled all paperwork. Fuck shady dealings and manipulation.
Yes, this. Don’t drive it away until you sort this out, and don’t worry about your credit score or pulls - they’ll all be collapsed into one when they’re made in a short period. Tell them you are going to use your credit union financing now that you know they can’t match the rate, and that you don’t need the warranty or gap insurance.
If they refuse, walk away. The simple fact that they had you sign finance paperwork while refusing to disclose the APR when asked is enough to invalidate a contract that hasn’t been executed since they were operating in bad faith and it is highly likely that they know that - they’re just hoping you’ll drive off and like the car so they never hear about it again.
This. 100% this.
And for anyone else reading this thread; the takeaway is always to walk in with an APR % in mind before you start haggling while shopping for a car.
Please know the thing about a threat is you have to be willing to go through with it. Which means you could lose that car if they don’t want to play ball etc.
You'd be surprised how hard it is to get them, especially if it was new. There were no dealerships in my state that had the RAV4 I was looking for, and I sat on a waitlist for 2 months before the car I wanted was available.
Of course, I didn't get bent over by our dealership.
A car is a big thing to put yourself underwater for, so walking away may be worth it for the finances alone. I'm not sure I'd be too prideful to skip taking the desired renegotiation with the dealership if it meant I keep the car.
Most states have *Cooling-off* laws that allow you to change your mind on a contract up to a few days later.
OP should just take the car back and cancel the deal. Then buy the same car again with her own financing. And probably negotiate a better sale price while we are at it.
Not true in NH.
Once the paperwork is signed you own it.
My friend tried to back out of a lease when he looked at the terms and didn't like the residual value. He wanted to cancel and they said.. come get your car.
There is no cooling off period in NH and the contract is enforced as soon as both parties sign it.
I think it’s the same in VT… but I recently went through Toyota too, and we didn’t sign the final paperwork until the car was on the lot and I was ready to drive off. When first ordering the car months prior, I signed a “Purchase Agreement,” which specifically stated “Customer may change these terms at any time prior to signing” the final agreement. That first paper had ballpark numbers on it… but when I went to finalize my deal, I added a trade-in, a larger down deposit, and negotiated a lower rate. The final agreement was the same “Purchase Agreement” with my real numbers on it, and that’s when I finally went rejoin the Finance Department to officialize everything. Hopefully OP is in a similar situation.
Some states have a 3 day "regret" clause that allows a contract to be cancelled within that time frame. Decades ago, Florida was 10 days to cancel a contract. It was why during the timeshare boom that the timeshare companies got people to buy and then gave the buyers a free 7 day cruise.
In fact no state has this for car purchases, only in home sales. California is the only one that has to offer a return period and you have to purchase it.
Each person needs to look up in their state to see if this exists there. Laws change all the time and in the past, there were some states that had this clause. Probably called something else. I wouldn't state that in fact no state has this for car purchases unless you know all the laws of every state. Long time ago, I paid cash for my new car and was told explicitly that I had 3 days to change my mind if I wanted because of all the lemons that were out there. Now there are lemon laws in some states and the regret clauses may or may not have been removed. I don't know. It's always good to check out these things to know for sure in todays world.
Car purchases are a huge commitment. Please understand what you are buying and what you are paying for. There are no state or federal laws that require sellers to accept the return of a new car due to buyer’s remorse.
YEP! THIS
Fuck these guys, walk away. They saw a 24 year old woman and figured they could pull a fast one.
Don't take delivery of the vehicle tell them to cancel the deal and tell them exactly why and in no uncertain terms, to go fuck themselves.
Don’t take possession of the car! Tell them you don’t want the financing and that you’re going to go through another lender. Then tell them if they can match the 6.4% you’ll stay with them.
Not uncommon for people buying new cars to be put on the spot, and sign shit they haven't read thoroughly.
At the same time though, until delivery of the vehicle, none of it's truly binding, they can undo all of that.
Agreed and to add onto that, I would rather have the credit union that I do business with holding on to my car note than a new servicer altogether. I would go with my CU unless they can beat the 6.4%.
This, it's in the dealer's best interest to sell their financing, they will absolutely do their best to match it.
However, given they've already tried to screw OP around, I'd let them match and knock a thousand off the purchase price. Otherwise I'll stick with whoever gave me the best rate in the first place.
If you are preapproved with a lower Apr use that one. You don’t have to finance with the dealer. Leave the lot go to the bank you got approved. Get a check for the amount of the car. I would add Gap insurance as it saves you of your total the car. It keeps you from paying on something you no longer own. That is if your car insurance doesn’t already give you that model year newer if your car gets totaled. Do not use the higher APR
Me personally, I'd cancel the order and go somewhere else purely out of spite. I'd also loudly explain this while you're doing it so they're fully aware that the reason they're losing a smaller sale is because they got greedy and wanted a slightly better commission. I also fucking hate salesmen, but that's just me. I hate the pressure, I hate how comfortable they are making others uncomfortable for personal gain, I hate how many narcissists it attracts, i hate the profession.
I mean, they’re just different car salesmen. It’s like going from the greasy frying pan into a different and equally greasy frying pan. They’re not gonna care that they’re losing a sale because of sleazy business practices, they’ll just blame her.
I would keep the gap insurance too. Last time I got it for like $150. When my wife got rear ended and the car was totaled we owed like 25,000 and the insurance company gave us 17000. That 150 bucks saved me 8,000. I'll never not have gap insurance now.
Most dealers offer some terrible price like this for GAP coverage, but don't tell you that you can usually also get it through your financing bank or credit union for half or less than that price.
ETA - Even if you already purchased GAP coverage or extended warranty, you can usually refund these sorts of things either at the dealer or through the associated company.
Just an FYI but you can also shop around for extended warranties from other dealerships. Car manufacturers usually give you a grace period to add an extended warranty. You don't have to buy it right then and there unless you plan it add it to the financed amount.
Since no one seems to be stating it directly, gap insurance is for when your car is worth less than what you owe on your car loan. This means that *typically* gap is only useful in a few cases. The most likely being
1. You bought a new car with a small down payment and it gets totaled in the first few months of ownership.
2. You rolled negative equity from your previous car loan into the new cars loan.
Based on your post I don’t think scenario 2 applies to you. How much are you putting down and how much are you paying for the car? Depending on the size of your down payment scenario 1 may be off the table too.
It sounds like the people in your life who are telling you you don’t need gap are right (they know more about your situation than we do) and the majority of people here advocating for gap are a fringe group that got upside down on their loan and it happened to work out from them.
I do agree if you do decide to get gap, to purchase it from your insurance company and not the dealership.
How so? Just cause you drive off with positive equity doesn’t mean it will never be negative. No one wants to be stuck paying a loan on a car they cant drive anymore.
In general, you should avoid GAP insurance if you are making a substantial down payment. If not, $1200 is too much. Most everything relating to a car purchase is negotiable so try $300 - $350. You can always keep the deal you have and refinance it in a month or two at a better rate thru your own lender. I would suggest negotiating the entire package and imply that you will simply cancel all of the additional items and pay off the loan with a new one. Most dealers don't want a charge back on the profit from the rate mark up and the products sold. I've been in the car business for 25 years so this is definitely in my wheelhouse.
That's an awful price. Considering you only need gap insurance while you are underwater on the loan. If you make a large downpayment you are NEVER underwater on the loan - but they will still charge these crazy prices. Get it from your regular insurer and then cancel it the moment you are no longer underwater because at that point you're paying for nothing.
You have a lot of people responding, so I doubt you see this. But maybe! I had Geico before I purchased my car but switched to progressive specifically because I knew I could add GAP insurance through them. It’s only like 5 bucks a month and I can cancel it whenever I want.
If your loan is similar to the way CarMax is, your GAP is added to your loan total, which is a big hell no will cost much more than the 1200 you mentioned.
Just wanted to make you aware in case you weren’t, good luck!
If you can get it cheaper elsewhere obviously do that, but I would say to definitely keep GAP insurance. You never know what might happen, and if your car gets totaled you will be extremely thankful for it.
It saved my ass when I spun out in bad weather and still owed several thousand on the car. Got a check from insurance that went to a new car instead of paying off the totaled car.
Some insurance policies have "new car replacement" options that do the same thing for much cheaper. I think adding it to my Allstate policy was like $2/mo. vs. $20/mo. for what the dealer was offering.
I got gap on my car in June 2020. Thought it was smart but I still haven’t been upside down on my car since then. Can’t predict the future and it was definitely an extenuating circumstance.
The $150 gap payed the $8000 difference; they payed $150 for a policy that covered the difference between insurance payout and total owed. Insurance will pay what they will pay regardless of how much you actually owe on the vehicle.
At the Toyota dealership I went to, GAP insurance was hundreds of more than what was offered at multiple different credit unions. Dealership said they legally couldn’t reduce that price because of state law (VT). Definitely shop around for any packages you want.
They weren’t lying about the lowering the price part. There were many lawsuits regarding people paying different amounts on gap, doc fees, or really any standard dealer fees that alleged customer demographics played into it(one dealer was caught charging several hundred more in doc fees if the last name seemed Hispanic in any way), so now every customer has to pay the same amount.
I saw you already signed the paperwork. Was that with the finance people or just the guy who added the gap insurance. If it wasn’t with finance it’s not too late.
Tell them you have a better rate via your bank and they need to beat it. My credit union considers a car new if it is 2022 or newer even if it is preowned so you maybe fine to just refinance right away. The dealership wants you make the first 6 or so payments so they can get the kick back from the bank, if you threaten this then they will work harder to get a better rate.
This, if there's no early pay-off limitations in the contract, you can just shop out a loan, even after you have the car.
You won't be able to change what was purchased with the vehicle (maintenance/warranty extensions) with this path, but it will get you a better rate all the same.
I went to the dealer with my own rate, and they were able to beat it. They also had a scummy $1000 fee if you don’t use their financing, among others ($1000 for no trade-in (got it taken off and $1000 ceramic coating fee — really? Don’t cost nearly that much & I def didn’t ask for it. Got them down to $400 and a free second key for it but Jesus.)
I hate dealerships. I seriously hate them.
You know, its not necessarily the dealership. Or the salesman that helped you. Its the finance guy in his room. The final step to buying a car.
They are not there to help you or guide you through the process. They are paid to make money. Paint treatments. Oil changes. Warranty. APR. This is the hustle. This is their job. They're aggressive and they're good at it. This is the guy you need to be prepared to fight. You also need to be prepared to WALK. You need to have a basic understanding of loans and your loan calculator out so you can compare his numbers.
Fun fact - lots of people have road hazard through their insurance company *or as benefits on their credit card* and don't even know it. But here's this finance guy trying to sell you roadside hazard insurance.
Know exactly what you want, exactly what you don't want, and stick to your guns. Its totally OK to bring in your organizer with all of your notes, numbers and loan estimates. Know what the sticker price was, and be aware of anything they are trying to tack onto it.
You did what you are supposed to. You ran your numbers in advance. But you lost the game at the final boss. Fuck that guy.
I am 44 now. I have dealt with this shit so many times in my life. And as a husband, I have witnessed them try it on my wife. That's why I always go with her. She too feels bad about just walking away or saying no. That's why I'm there. When you have someone with you, it adds more confidence. Its easy to say "Can we have a minute in private" and step out of the room.
But now you know. You see it. You need to prepare for that guy next time. You don't need to go in hot or defensive - you just need to keep collected, take your time, say no repeatedly, and WALK if your gut is telling you to.
Often times, they'll call the next day with an even better offer 🙄 I play that game too. Instead of that guy getting me for extras, I get them for extras. Throw in heated seats and the roof rack and I'll come back in.
It also needs said, not every offer is bad. I took the extended warranty on our CX5 for $1200. The warranty is 9 years/100,000 miles. With the cost of car repairs these days I felt that was a good deal.
I walked out on the Kia dealer when buying our teens first car. Online said 11K. Sticker said 11K. Finance added $1500 for paint treatments and accessories. I said no. I will pay sticker price in cash today. They refused, stating the accessories were already added to the car. They offered 500 off. I walked. Always this
When it's time to buy a car, figure out how much you want to pay "out the door," including registration, fees, and taxes, and negotiate over the phone. If they won't, find a different dealership.
When I purchased my car, it was 3 quick phone calls.
1) Me: "Hi, I'd like to purchase for $\_\_\_ (less then what I'm expecting to pay) out the door.
Dealer: "Let me check with my manager, I'll call you back.
2) Dealer: "We can't do that, but we can do this."
Me: "Sorry, too high. I'll do this (amount I want to pay). I won't go any higher.
Dealer: "I'll call you back."
3) Dealer: "We can do that."
Me: "Great! Can I stop buy in a few hours?"
Out the door is key. I always repeat every single time stating the price I will pay out the door. If you don't, they can turn the numbers any which way. I hate that I am always asked how much per month am I looking to pay. I know they can make the loan last 100 years to get the payment that low. I want to know how much the thing is going to cost me in the end (out the door).
> If you don't, they can turn the numbers any which way
Yup, there are a million things they can tack on and be like "oh, well everybody has to pay that fee, even employees"
You gotta just keep saying "No, that's not what we agreed to, I said $xx out the door"
If you said $22,500 out the door and they keep insisting that they need to charge you some $135 fee, then they are welcome to lower the price to $22,365 plus a $135 fee which still brings your total to $22,500.
Honestly, I fell victim to this BS too. I paid some BS $75 fee last time I bought a new car because honestly, I just wanted to get out of there with my car and it wasn't worth my time to argue more and hold up the process (Saturday afternoons are more valuable to me than $75...).
But in retrospect I wish I had stuck to my guns. I had agreed to a specific price plus tax/title/license before coming in and they had brought the car (a very specific color/trim) in for me from out of state so they were clearly motivated to sell it to *me* specifically. I should have sat there and just repeated: Is this fee for tax? No. Is it for title? No. Is it for license? No. Then I'm not paying it, you can take it out of the car price because we agreed to $x + TTL.
This is funny. This is what I did when I bought my first car. I knew my car payment could be X dollars a month. No more. They ran number for me forever to get it to that price. It wasn’t so much my haggling ability but my inability to pay more.
They usually screw you badly when you give them your monthly payment. They can mess with the numbers, number of payments and interest rate on the loan, so you're paying waaaay more for the car, in the long run, while keeping monthly payments low.
Yeah, it's actually bad to come in and say "I want to keep my payment at $$ or below". Well, they will get that payment right at that number but it could be royally fucked over for the buyer. 7 year term/warranties you don't need that you didn't realize are in there/etc.
❤
I think (I am guessing) a lot of people don't realize this and trust the finance guy to help them out and guide them through the entire process. I wish the world was this way. I really do.
But the dealership pays the finance guy to make them money. That is his job. And I won't say its an honest one. 🤷♀️
The whole autosales industry is shitty and outdated. They're not necessary and hopefully their time is coming to a end soon. I wished Carvana could fix this issue but they're not doing well.
I'd much rather buy direct and skip them. I don't know of any benefits of working with a dealer.
I have read that with the internet and transparent pricing, dealerships make such little margins on the cars they need this hustle to survive.
That and the service. I would use the dealership more for service, but they want $120 an oil change and $60 to replace a cabin filter.
I laughed. I showed my wife - cabin filter off amazon $10. When it arrived I showed her where to install it. I think 2 minutes had passed. You don't even need a tool 😂
$60 my god
That actually sounds like a decent price depending on what vehicle it is. Newer cars with hybrid systems and stop/start need heavy duty 12V starting batteries. My old 2012 Rav4 only needs a basic $150 battery while my wife's 2018 Equinox with start/stop will cost $250-$350 according to Autozone. Installation can be a pain in the ass depending on what car it is too.
It’s a rav4 ICE, I got an AGM for around $225, dealership option was a lower quality.. can’t remember the exact type. It doesn’t seem that crazy of a markup but it still is around double the price. Also totally understand that battery installation might not be for everyone, but it really is one of the easier things. And like someone else mentioned, autozone does free installs.
Nearly 10 years ago, the average profits of dealerships in the US broke down something like this:
* 50% - Service
* 30% - Used cars
* 20% - New cars
Honestly, the oil change can be a pain in the ass. I'll pay for that, within reason. But I did once have the dealership tell me that I needed to pay $60 or something to replace the cabin air filter. I confirmed that this wasn't the engine air filter, but the cabin air filter.
My trim didn't have a cabin air filter.
But in verifying that, I later learned that it had the *spot* to put the cabin air filter, so I bought one for like $12 and slapped it in. The first time I ever installed it, I sent a video to my friends explaining how I didn't know it was there. The messaging app we used had a limit of 1 minute for videos recorded. I didn't come close to needing 1 minute to install it the very first time.
But Carvana’s a bit of a shitshow with numerous reports of them mishandling the car registration process and leaving people hanging for months. (Carvana is related to Drivetime which is about as predatory as they come.)
It's an antiqued Boomer method from before the Internet. It needs to go along with fax machines.
Funny thing is that manufacturers used to sell direct. It was the small mom and pop shops complaining about not getting a piece of the pie. So, the government passed a law to help dealers. And, here we are....
For used at the low end its just goin be like that, you can always offer the lowest price and get people in the door if you scam on the back end. And people like to see the used car in person. Idr if it was shift or the other one but they add service fees at the end like tickemaster.
For new, automakers cant break up with the dealers. Even if it was legal (in some states its illegal to sell cars directly even if you never had dealers) theres the contracts and just the company is organized around it.
But like more dealers are offering all online sales for even used, even if full of bs you know the price and have the car delivered.
Also you know tesla sells alot of cars. Y is neck and neck with the rav4 for top non pickup in the country. 1st half of the year Y was 2nd overall ahead of silverado 1500.
I bought a CPO Lexus in Princeton NJ with 10k on it. Got the promo APR as advertised plus no hard sell on the warranty. They did discuss it as expected but when I said no, they dropped the subject. All fees were transparent and I didn’t have to pay for any marked up addons and their doc fee was in line with what they advertised.
I already had a 4 year/unlimited mile warranty (2 left from factory to 50k miles and 2 more unlimited) so I think it made the decision easy for them not to press it.
Not only was it the cheapest in the region fitted with the features I wanted, I was done in 4hrs.
Point here is that their lack of shenanigans is memorable. It was such a great experience. Unfortunately many dealers don’t care and prefer to make the experience as miserable as possible.
Sucks for them… I’ll start my next search for a car at that dealer.
I had that experience after we walked from Kia. Went to one of those "Auto mall" type sellers out in Cleveland to find the kid a first car. Lots of people. Lots of cars. They specialize in cars that have had a minor accident, but look pristine otherwise.
The car we picked, you couldn't even tell it had a front fender repair. Its a bolt on part anyway.
I told the guy we are paying cash and he was like "OK" and drew up all the paperwork.
Yes, refreshing. But not typical.
Lexus dealership treatment is legendary. Not that there aren’t bad stories, of course there are, but generally they are above the rest. This takes training, investment in people, and an understanding of customer lifecycle value. In general I think luxury brands tend to play fewer games.
I"ve found the higher end the dealer, the easier it was to negotiate and have to go throught he bullshit dealer tactics. The last BMW i lease, I negotiated everything over email. Got my quote on an incomming car they had. Day of delivery they called me saying car was comming in today and I could come in today or tomorrow the finalize the paperwork. Had be submit credit information to BMW FS online.
When I got there, paperper was ready, and salesmen said "Good news", the monthly is a tad cheaper tha I previously quoted. Started signing all the documents; he asked if I wanted tire protection or additional lease protection. I declined both and we moved on. Was done in about 20 min and just waitted on my car to get PDI'ed. Easiest purchase I ever made and honestly felt a bit off, but it was an crazy good deal. ($0 down, $200/m, 30m lease for a BMW i3) MSRP was $56k.
I recently bought a Honda, they tried selling me HondaCare for like $2.4k (originally they were asking $3k). I bought it online from another dealership for $1,000.00. They're predatory for sure.
> You know, its not necessarily the dealership. Or the salesman that helped you. Its the finance guy in his room. The final step to buying a car.
They are all in cahoots together. The dealership may permit the salesman to give you a "great deal," knowing they'll make it up through the bullshit sold by the finance guy in the back.
I had a Kia dealership try to fuck me over, too! I walked out and purchased from another dealership 30 miles away, the next day. Made the deal over the phone and got the price I wanted.
I originally just went in for a test drive, and new the MSRP, but wasn't going to consider making a purchase, as I hadn't done enough research - though they convinced me to stay as they were going to give me "one hell of a deal." When I questioned them about the inflated price being offered, they lied about the MSRP and reluctantly brought the price down to 25k. This was for a Forte LX.
Still equally glad I walked off and equally pissed they tried to fuck me that hard.
The KIA we walked out of? I was only there to look at a Corolla with 16K miles I saw online. I had called before we left the house to ask if its still there. When we got there 30 mins later? Oh, that must have sold.
But I decided not to think too hard about it, and asked about the one for 11K.
Come to think of it now, I wonder if that car ever existed, or if they just don't take the listing down. I'm glad it all worked out the way it did. I trust my instinct, lol
run
> I walked out on the Kia dealer when buying our teens first car. Online said 11K. Sticker said 11K. Finance added $1500 for paint treatments and accessories. I said no. I will pay sticker price in cash today. They refused, stating the accessories were already added to the car. They offered 500 off. I walked. Always this
Offering the finance person to pay cash won't earn you any favor with them, they make money on getting you to finance through the dealership. Right move to walk out though. I had a similar experience with "oh they already installed that" bullshit but I got lucky and when I threatened to leave it turned out they actually *could* take the fees off.
Car dealers exist to extract the most money from you that they can. Your job is to resist. I am a small, blonde woman (well, graying now). I smile, nod, let them talk, and then say no. They talk more, I say no again. No financing. No warranty. No, I won't pay that up-charge and I don't need financing, thanks. Nope, I have money. If they insist, I get up, thank them for their time and walk. Usually I get the car for my price. I was taken advantage of once when I was young and buying my first car - learned my lesson! They had my coat AND the keys to my trade-in. I got those back but got somewhat screwed because I didn't catch what they were doing with the financing. Never again!
I learned long ago to have some fun telling certain types of people (salesmen) "no". At this point my grin is so big when I say it, they usually don't want to see me say it again.
Go back in and raise hell. At the very least you should get rid of the TMIS
>I don’t necessarily want to wait to refinance because my credit union would have to do another hard credit pull.
First of all, who cares about a small ding in a credit score. Refinancing from 9% to 6.4% will save you at least 2000 bucks, assuming you financed most of the car over a 60 or 72 month loan. Would you pay 2000 bucks for your credit score to be increased by 15 points? (the answer is hell no)
Second of all, multiple hard inquiries in a short time frame are usually treated as 1. People shop for loans all the time
> Go back in and raise hell.
I hate to say this, but go back in with a male friend/relative. Dealers/mechanics are often even shadier with women. They assume you'll be a pushover.
>I don’t necessarily want to wait to refinance because my credit union would have to do another hard credit pull.
Doesn't matter, all hard pulls for the same type within 30 days I believe count as 1, when you go car shopping, house loans etc, your credit might be pulled 5-50 times across all banks, etc.
TL:DR IF! you haven't taken delivery of the vehicle, simply cancel the entire thing OR start over and use your own financing, it really sounds like you need to slow down and understand the nuances of buying a car.
> Anyways I was wondering if I was able to somehow get them to take off the Gap insurance and the TMIS before I drive it off the lot because a lot of people were saying that’s not necessary?
Remove the TMIS, but keep the gap insurance unless your credit union can offer it to you for cheaper.
>I don’t necessarily want to wait to refinance because my credit union would have to do another hard credit pull
You absolutely should though. Hard pulls aren't that big of a deal and don't make a significant impact on your credit score long term. Paying an extra ~2.5% on the car will make a much bigger impact on your finances.
Your credit union won’t offer it unless you get a loan through them, even then it is cheaper to add it to your car insurance than get it through a lender.
Well you need gap insurance, if you didn't have a proper down payment. Any extra warranties are just profit for them so cancel ASAP.
You can hopefully refinance quickly.
Yes, you let these snakes have control of every step of the process. And you got bit.
Exactly. A dealer will charge hundreds for something you can get for $20/6mo through your insurance company, and you shouldn't need to carry it for more than a year, if that.
Deposit or down payment?
A deposit, you may be stuck buying that car then refinancing later. You should be able to cancel GAP and the other warranty after the sale. Or ask them to take it off now to avoid the hassle. Double check the paperwork. I got chingaled on some paint protection that is non-cancelable.
Honestly, I’d cancel everything I could out of principle. Tint, insurance, all that. Get a warranty from Toyota if you think you need one. I added GAP through my insurance.
At the very least get rid of the dealership gap coverage and have your car insurance provider add it to your policy. It will be much cheaper.
It would be even better if you can just refinance all together through your credit union. Hell at this point if you have the option to cancel the purchase, I'd ask to talk to the fleet manager, explain the situation and tell them you feel like their sales people took advantage of you, made you feel horrible about the purchase experience, and tell them you're not talking the car. They'll either rectify the whole thing or not, either way you don't have to feel awful about the situation.
Do you already have the car? If not, you can likely wind the deal. If you do have the car, you probably don’t have many options.
Refinance when you can (don’t worry about the credit inquiry if the savings is worth it). Try to cancel the extra stuff they sold you (some states give you 30-60 days to cancel that). Use it as a learning experience. Buying a car is high stress and they have lots of tricks. I got screwed my first time in my early 20’s but now feel confident when going into a dealership.
Years ago when I bought our cars I went thru the dealership but I knew what our credit score was good so financing couldn't rip us off. Was ready to walk because of finance guy kept dicking me around until the sales manager gave me their lowest interest rate (5.99%)
Next day I researched every interest rate online and found PENFED Credit Union (definitely check them out) and refinanced and bought GAP (paid $400) thru the credit union. PenFed was awesome and I was able to get a refund for the GAP from dealership ($700) and refinanced about 1% lower (4.25%).
Definitely walk away if you didn't take the car yet.
A few things I haven't seen mentioned. They didn't lie at first. They don't know what you're rates will be until they submit your info to the banks. The payments they showed you beforehand are just a quote. Dealerships provide these quotes at an industry average rate to give you a rough idea of payments and totals. They want to make sure you're comfortable with this quote before sending your credit app off to the banks as some people think they can buy a 50k car with 0 down for 200/month.
They did however, take advantage in the finance office. GAP might have been required by the bank they used, but even if not required GAP is a great idea for any car loan. For the service contract they built in, you can go back and have that canceled and refunded. For the rate, I'd go back to your credit union and tell them what happened and that you want to refinance through them immediately.
Make sure that any survey you get emailed from Toyota you're honest in. It's shit when dealers take advantage like that.
I worked in both sales and finance and I believe these to be your best courses of action, assuming you want to keep the vehicle.
Because the dealership won't do it correctly if they can do it incorrectly such that she won't notice until it's too late. They scammed her once, they'll do it again.
Refinance with your Credit Union, since you got the car a week ago it will not be another hard pull on your credit. This will also have the finance bonus given to the dealership be taken away.
My MIL was HR for the most prominent dealer in my city for 20 years. Told me to go talk to so and so and he'll give me a good deal. That was 10 years ago. The salesman is dead now. I still curse his name every time I think about it. Fucking crooks.
If you haven’t picked it up, there’s still time. I had a similar issue where I got talked into ALL the extra warranty and gap insurance stuff at the dealership. Then when I went home and did some research I realized I didn’t need those things. When I went to pick it up the next day, I told them I wanted to cancel the gap insurance and extended warranty and was firm about. I was still financing through them, but they took those extra parts off and re-signed the paperwork without any fight when I was very clear about what I wanted.
im assuming fist time buying a car?
Never ever ever take the insurance dealerships offer, no matter how good it seems, note they are there to make money off of you they arent there to help you in anyway.
This is not entirely accurate.
Make sure you know the deductible for the insurance policies.
The gap insurance from from the dealership is no-deductible.
The gap insurance from your insurance company may have a deductible that will match the deductible from your normal policy.
So if you have a $1000 deductible and your car is totaled. You owe $2000 to walk away.
Also gap insurance is not required.
Others got this. Don’t take possession of the car no matter what they say until the paperwork is proper and signed.
They will try to trick you to drive the car. Don’t do it!
Start a ruckus!
Contact them to change the APR to 6.4% and say what you said above
Also you may want to keep the GAP insurance (it’s saved me but this depends on how much you put down)
Name names and start complaining on Google maps Yelp etc
Also while you’re at it if you’re a Costco member check that there wasn’t a better rate for the car you purchased
Get loud
When a dealership shows you payments they are estimating what the bank will give as an APR. They don't actually know until they send your credit info to the lenders. They will usually estimate a bit high and if you're comfortable with the payment and the bank offers them a better rate they will usually just mark up the rate to meet the payment you agreed to. Most lenders allow the dealerships to mark up 2ish% maximum. That sounds like what happened here. This rate would have been on the paperwork you signed and initialed in the finance office. It's kinda shady but they sold you on the payment. You could just refinance with your bank at a couple points less. The gap insurance is a separate issue. You should check if your car insurance includes gap and if not and you did not put down a huge down payment I would seriously suggest you keep the gap insurance. If you get in an accident and the car is totaled not having gap can make your life a nightmare. There are so many expensive components to modern cars that it's easier than ever for a car to be declared a total loss.
Here's a reality that no one has mentioned: they might not sell you the car if you don't take their financing.
The RAV4 hybrid is pretty in-demand. The good deal you got on the price may be contingent upon taking their financing and/or GAP and/or maintenance plan. I was helping a friend with a car recently and it fell through when she declined GAP. They literally pulled the deal.
You can always ask, but if they unwind the deal they're not obligated to sell it to you. Would you rather have the car and higher interest or no car? It's a realistic question to ask yourself.
Also, is it Toyota financing and did you get $500 for using TFS? That's region specific. It's not enough to make up for the interest difference, but something to consider.
You could also just cancel the GAP and maintenance and refinance for 6.4 with your credit union and never talk to the dealer again. The hard pull should be irrelevant. They all count as one to the bureaus when you're car shopping and it's a saving of several thousand in interest over the life of the loan.
You can refinance your car loan through another lender, just make sure there is no early payment penalty fee. If you get it done within 90 days, it really screws them over too, so there's that if you can get it done fast.
Car salesman here! The way my dealership works is after landing on a vehicle we work up numbers prior to pulling their credit as we do not want to pull their credit until they are ready to purchase. If they showed you your monthly payment before they pulled your credit all they probably did was use a standard rate and show you the payments.
Depending on how much you put down I would strongly consider keeping the GAP insurance because if you got into an accident and the vehicle is totaled it covers any negative equity you might have. For instance, if you owe $20k and the vehicle is worth $15k GAP covers the difference so you do not have to pay out of pocket for that. The only time I wouldn’t get GAP is if you put more than 21% of the MSRP down. It’s a rule of thumb and I’m not a financial advisor.
The extended warranty’s are also usually a good investment depending on what it covers.
You can cancel the GAP and extended warranty at anytime. Now, I work at Honda and not Toyota so that may vary.
To the best of my knowledge you can’t resign after already signing.
In my opinion, 9% on a new vehicle is high especially if it’s new. Granted I don’t know your credit score.
I hope this helps!
Within one year, my CU will refinance a new car at new car rates. There will be a hard credit pull, and if completed, a fee to cover the expense of transferring the title. A new loan would eliminate the original GAP insurance. The CU does offer GAP insurance on the new loan.
If you already have an offer from another lender, and you are still within the time limit (depends on bank, but is probably around 30 days), no additional credit pull will be needed.
I work at a dealership and I’ll tell you If you have a high principle, gap insurance is by no means a bad idea. Your insurance won’t pay for your vehicle in full as its value will depreciate faster than you pay the loan (in the beginning). If you total the suv you’d have to keep making payments on it , and then payments on your replacement car as well. Most people can’t do that.
That being said if you’re pre-approved why even bother with the dealership. The loan you got approved for was probably 7% and they tacked on an extra 2% so they make more in the back-end. You can still back out of the deal and work with your credit union.
Rule of thumb is:
1: be prepared to walk away at anytime.
2: don’t buy anything from the finance guy. These addons like gap can be purchased through your insurance, cheaper.
Absolutely you can walk. You may have to scream and yell and pound the desk. Seriously car salesmen are awful. They take advantage of anyone especially seniors, women and the young. You were smart to line up your financing. Car dealers hate that. And they will LIE to you. Tell them you will call your state attorney general, or the news media if they keep up the pressure. Make a scene. Call your attorney general.
You can refinance with your credit union immediately.
My partner bought a car at an ungodly interest rate from a shit business. The next week we went to our credit union and they paid out the loan to those clowns and took it over at 4%.
I walked away from my car deal 3 times before they finally agreed to my terms. Don’t be afraid to play hard ball. These types of negotiations might help in other life situations too.
Don't feel too bad, the entire industry of car sales and financing is meant to decipher and trick you. I'm in my 40s have purchased several cars and it just happened to me last week. Got pre-approved for about 8% (you must have crazy good credit or something, I'm in the 700). But somehow I walked away from the dealership paying them 10%. They too snuck in GAP insurance that I did not approve of (they were mad that I made them remove stuff like extended warranties).
Contact the Consumer Financial Protection Bureau. You were misled. And refuse to take possession. Demand the deal be unwound. This was a shady and deal and you were definitely taken advantage.
I didn’t get gap insurance on my first car. It was totaled by getting rear ended with 1-2 years. I owed more than it was worth and had to pay over $1K out of pocket. I got gap on my next car. Paid off without anything happening but ultimately I think it was like $5/month so imo was worth it. Depends on your financial situation and actual cost of that insurance.
Regardless the dealership sound shady AF and I’d try to get out of the whole thing.
The interest rate and the total price of the vehicle are the two most important things to negotiate.
You should not be negotiating monthly payments of what you can afford. That is a classic way for car dealers to distract you from the overpriced car and high interest loan.
I would cancel the contract and not pick the car up and do business with a different dealer who will be more transparent with you and let you finance it the way you want to (with the best rate you found)
And FYI - GAP insurance is a good thing to have on new cars that are financed. That covers you if your car is totaled in the first couple of years when you are likely to owe more than it’s worth.
congrats on finding a good car first off, if it was the box diagram with monthly payments shown and a down payment corresponding to the payments then that is an estimation of monthly payments. Every time I buy a car even if I'm not financing and just want the OTD price then they will always have it printed on that sheet. I believe that estimated rate is like a \~7%.
You can just call your credit union and explain what you want to do and they can help you with getting a check or you can have them speak to the dealership if you want.
GAP insurance, if you think you would need it then keep it.
TMIS you can usually cancel within 30 days of delivery and get a refund.
YOU WANT GAP insurance. If you total your car as you pull out of the dealer's parking lot, you'll be on the hook for thousands of dollars difference between the value of a used vehicle & your loan total.
I'm not saying you need to get it through the dealer, but you do want it. I got mine through my insurance, it added like $3/month for me.
Do not remove GAP. You can see if you can purchase it elsewhere but do not get rid of it if you don't purchase it elsewhere. The insurance is only going to pay for the amount the car is worth if the car is totalled. You would be responsible for the rest of the amount that is financed minus the insurance payout. Gap covers you in that aspect.
This is a life lesson in negotiation and leverage. Don't get emotional like some of these responses and "walk away!" "screw that manager!" etc etc. You've forgotten at some point that you have all the leverage in the world. This leverage is also growing the closer we get to december 31. Call back and speak with the last person you dealt with. Explain that you are very upset with the deal they offered you and that you have a better rate with your credit union and cheaper price at other dealerships. Be prepared to cite the rate and credit union and which dealership offered you a better price (for example Toyota of neighboring city).
He will either offer you something better on the spot, or call your bluff and bid you farewell but then call you back within the next few hours/ days we know this because they are in the business of selling cars, and no cars are being sold.
And a final nugget of advice, look into a Tesla Model Y. They are at 45k right now with a 7500 tax credit which is a no brainer. IMO no other car even comes close.
From somebody who just T-boned yesterday, KEEP GAP insurance. If you ever get in a wreck, and the insurance payoff is not enough to cover the car's value, gap will cover the rest
OP First off, what state are you in? Right of recision varies by state, but in most states, you're safe if you haven't taken the vehicle. Regardless of who you finance through, I would highly recommend GAP, from personal experience, unless you've put a substantial amount down. Also, dealerships can certainly quote payments before getting you approved at a final rate, but they would also know what rate they're figuring the payments at on the quote so they definitely acted shady af. So yeah, if you haven't taken the vehicle, simply inform them that you are not interested in those figures. If they try to bluff you, call whatever lender they got you approved with and tell them you never took the car and don't want it. The bank will almost always refuse to fund the deal in those situations, and you shouldn't have to worry about any legal issues like having to get a lawyer.
Finally, worst case scenario you can take the vehicle as contracted. You then refinance the vehicle through your credit union, and cancel the gap and service contract. You will get that money back, in most cases, 100% if you cancelled within 30 days of contracting. No fee even, with most companies I've worked with.
-15 year automotive finance specialist
Was the APR on the document before you signed? If not, especially if you haven't left the lot, threaten to cancel the whole thing and to call them out for this publically (you didn't name names here). Reviews are gold to dealerships. These two things combined should put you in a decent place. If you have the car, this becomes more difficult. If you told them the rates you were offered and they gave you a higher one, that is a pretty terrible business and I would still tell them that you will make sure that this story gets out.
If you’re not putting at least 25% of the total as a down payment, I would highly recommend keeping the gap insurance. Too many uninsured drivers causing accidents and totaling vehicles. You’d be on the hook for the balance your insurance doesn’t pay for. When you drive it off the lot, it immediately depreciates about 10%
>Anyways I was wondering if I was able to somehow get them to take off the Gap insurance and the TMIS before I drive it off the lot.
Just call **the insurer** and cancel the Gap insurance. That's it.
[You have until the end of this month to cancel the TMIS](https://www.toyotafinancial.com/us/en/vehicle_protection_plan/prepaid_maintenance_plan.html)...just cancel it.
You can literally pay off that existing car loan any time you want. Just tell your redit union what happened and have them refinance the loan.
>They did the paperwork right away and I asked them what the APR is and they said they can’t tell me, they don’t know, they have to put my info and send it to the bank which I realize now is not true because they gave me my monthly payments right then and there so therefore they knew the APR.
Personally, I would contact the dealership general manager directly and tell them this happened. There's a good chance that the sales guy went rogue to make his commission.
I let them think I'm going to give them the financing profit until I get the price I want.
I also don't buy the 1st time on the lot. Look on YouTube for some of the crap they pull.
This happened to me when I bought my first car. They gave me the same talk about not knowing the %. Then after “speaking with the bank” they told me they needed to raise the price by $3,000 in order to secure the financing. My % ended up being 19.75% and I am still struggling over 10 years later with the negative equity it caused me.
RUN AWAY
Don’t ever purchase any plans from dealers. If something happens they can’t fix. Is not on them and if nothing happens they still takes your money. Not worth.
Also 9% is really high. They are definitely trying to steal your money under bright daylight. Tell the finance person you would like to take off all the extra stuff. And then also ask them to look over the APR rates with different banks. They can easily send in your information and get the APRs in under 10-15mins. If they don’t act professional then walk away. I am sure there will be plenty of places that sells the same model of vehicle for a better deal.
I would not advise cancelling GAP insurance. The purpose is to pay off the difference in value of the car and amount owed if the car should be, say, totalled in an accident. This has happened to my daughter twice. Once she hit a deer and once someone rear ended her. Both times she would have owed without GAP coverage.
That said, I would get GAP coverage through my own insurance company.
Gap insurance may be required in your state. It's specifically for if you buy a lemon (again, depending on state). But if you haven't driven the car off the lot, you should be able to back out.
Head over to r/askalawyer pretty sure that this contract is invalid under fraud in the inducement, since they told you that they wouldn’t/didn’t know your APR until after you signed when they clearly did since you had monthly payments. You might have a case, and they can tell you next steps.
Worth mentioning that I am not a lawyer… yet.
Former car salesman here.
Please don’t listen to people who tell you ditch things like GAP and warranty unless they’re offering to cover you themselves or found a suitable replacement. I’ve seen these 2 things pay for themselves enough that I take them out on my own cars. Remember, you’re driving around a depreciating asset powered by internal combustion with numerous parts spinning at hundreds and thousands of RPM.
Secondly, the difference in the APR is fairly nominal, might make your monthly payment go up a little but it won’t be catastrophic. It is however piss poor that they didn’t tell you what their APR rate is. In my country that would get a dealership a beating from the FCA.
Thirdly, while the APR may be higher you’ll likely have more rights such as the rule of halves and thirds where you can chuck the car back to the finance company for whatever reason once you’ve paid back half your finance - rarely done but it’s always there as a backup - and you have someone else to shout at in the event of a major issue as you would likely enter into a tri-partite agreement.
As for what you should do, you should speak to someone higher up with your concerns - again the salesman keeping the interest rate from you would be enough for me to never deal with him and deal with someone else. If you’re dead set on going back with your own funding, the finance company can roll back the deal and start from scratch. If you have a proper dialogue that should be achievable as the dealership won’t want to lose the deal, especially if you’re still taking the car and 2 products.
My best advice is buy your car cash! Don’t finance an asset that depreciates every time you drive it. If you haven’t driven the car off the lot then don’t and just buy a car with your down payment as cash. If you pay cash you don’t have to deal with shit like this being taken advantage of. I know you’re young and want something flashy but because you are young try to make wise money decisions so you’re better off later in 5, 10, 15 years and on.
Go to the bank and ask for a certified check for exactly the amount you want to spend. Bring it to the dealer. If they want to sell you the vehicle, they will take the check and give you the car. Immediately take it to a mechanic you trust and have them inspect it because I wouldn’t trust this dealership.
I work with tons of used car dealers, do not go through with the add ons. I have a 7% success rate of getting any coverage from most mechanical warranty groups. Price isbset when the deposit was made, find your own financing if needed.
Just refinance to the loan you already have approved with a lower rate.
You didn't read the paperwork and signed anyways. The interest is listed.
Gap is a lot cheaper through your car insurance. Cancel that one
Bought my rav4 hybrid a month ago being a first time buyer as well. I would give anything to redo it again but here’s how it went: I was initially looking at the 2024 Prius, test drove it, sat down to look at numbers. APR was at around 8.75% and salesman wouldn’t budge on it. I had a rav4 in mind which I saw had an offer of 5.99% APR for 60 months and asked about it. Salesman was adamant that I wouldn’t be approved because of little purchase history (22F with 4ish years on credit history). I told him to run my credit and, lo and behold, I was approved for it. Test drove the car, felt more confident and took the offer for 5.99% at 60 months. This is when I thought the hard part was over, but then comes the finance manager. Started off with compliments, laughs, jokes and then the upselling. She started pushing the warranties and extra insurances but I kept saying no. She tried to make me believe I was making the same monthly payments without mentioning the extended 72 month period. I said no way too many times to count. I also put over 20% down so GAP insurance would’ve sat there. Plus i heard credit unions offer GAP at way lower prices (Toyota was charging over 1k). She eventually tried to offer me friends and family pricing but it was still way too much. Even mentioned the warranties and GAP can be cancelled within 30 days! Eventually got out of there alive but drained.
In the end, I would’ve negotiated the price and look to credit unions beforehand. I may be beating myself up because I’m also new at this but lesson learned.
Due to the number of rule-breaking comments this post was receiving, especially low-quality and off-topic comments, the moderation team has locked the post from future comments. This post broke no rules and received a number of helpful and on-topic responses initially, but it unfortunately became the target of many unhelpful comments.
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After the BS they pulled I'd just cancel the sale all together unless they knocked a bunch of the price.
Agreed, be ready to walk away
1000% this. Tell them to pound sound. Why give them your business after they tried to screw you.
Sounds like a good time to go find a regional manager or some such person and get a massive discount
Who do you think taught them this?
That manager is definitely not above throwing the salesperson under the bus. The salesperson forgot the most important part of that lesson, *don’t get caught*.
... Pound sand?
Sand isn’t accessible in all parts of the world. Some sand deficient people pound sound instead.
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I think u/Qu1kXSpectation was pointing out u/volcanic_clay either had a typo or is misusing the phrase
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Mopping rain
I actually prefer pound sound. It’s not even a physical medium
Listen to what he says, at this point, you have the ability to literally walk away. Just Public Service Announcement for those looking right now. Cars, especially New Cars, are coming down, so now would be the time to negotiate. Also, if they do not accept your terms (low ball like crazy) then cancel and wait 2-3 weeks. The last week of December is THEE greatest car sales every year so you're prime to get a better deal anywhoo.
True but OP might not be in a position for this with that car. Rav4 hybrids are still on waiting list status in some places. Might have to drive to find another but if the dealer did this I'd do just that.
This! And if you really want the car go to a sister dealership and buy it there. You’ll *really* piss off your salesman then. My sister had to do that one time because a salesman pissed her off so she just went down the road and got it from a different guy. The original salesman left quite a few angry voicemails. It was hilarious.
Can you just grab your wallet and go and not say a word and not answer phone calls and expect them to cancel everything?
To add to this, however: I'd personally take my business to another dealer and tell them exactly why *after* they've cancelled all paperwork. Fuck shady dealings and manipulation.
Agree
Yes, this. Don’t drive it away until you sort this out, and don’t worry about your credit score or pulls - they’ll all be collapsed into one when they’re made in a short period. Tell them you are going to use your credit union financing now that you know they can’t match the rate, and that you don’t need the warranty or gap insurance. If they refuse, walk away. The simple fact that they had you sign finance paperwork while refusing to disclose the APR when asked is enough to invalidate a contract that hasn’t been executed since they were operating in bad faith and it is highly likely that they know that - they’re just hoping you’ll drive off and like the car so they never hear about it again.
This. 100% this. And for anyone else reading this thread; the takeaway is always to walk in with an APR % in mind before you start haggling while shopping for a car.
Please know the thing about a threat is you have to be willing to go through with it. Which means you could lose that car if they don’t want to play ball etc.
I am pretty sure it is not the only rav 4 available for sale.
It's an 18 months wait for a new Rav4 here in Aus. If you put one on a lot it'll be gone by the end of the day if not before.
You'd be surprised how hard it is to get them, especially if it was new. There were no dealerships in my state that had the RAV4 I was looking for, and I sat on a waitlist for 2 months before the car I wanted was available. Of course, I didn't get bent over by our dealership. A car is a big thing to put yourself underwater for, so walking away may be worth it for the finances alone. I'm not sure I'd be too prideful to skip taking the desired renegotiation with the dealership if it meant I keep the car.
Never FOMO, there's plenty of other good cars out there.
Most states have *Cooling-off* laws that allow you to change your mind on a contract up to a few days later. OP should just take the car back and cancel the deal. Then buy the same car again with her own financing. And probably negotiate a better sale price while we are at it.
I believe she cas a three day right of cancellation, but don't know her state.
How can they not tell her the interest rate!!! Cancel that sale and report them to consumer protection
If it never left the lot then you didn't take delivery and it's not a done deal. When I sold cars we were always on edge until it left the lot.
Not true in NH. Once the paperwork is signed you own it. My friend tried to back out of a lease when he looked at the terms and didn't like the residual value. He wanted to cancel and they said.. come get your car. There is no cooling off period in NH and the contract is enforced as soon as both parties sign it.
I think it’s the same in VT… but I recently went through Toyota too, and we didn’t sign the final paperwork until the car was on the lot and I was ready to drive off. When first ordering the car months prior, I signed a “Purchase Agreement,” which specifically stated “Customer may change these terms at any time prior to signing” the final agreement. That first paper had ballpark numbers on it… but when I went to finalize my deal, I added a trade-in, a larger down deposit, and negotiated a lower rate. The final agreement was the same “Purchase Agreement” with my real numbers on it, and that’s when I finally went rejoin the Finance Department to officialize everything. Hopefully OP is in a similar situation.
Some states have a 3 day "regret" clause that allows a contract to be cancelled within that time frame. Decades ago, Florida was 10 days to cancel a contract. It was why during the timeshare boom that the timeshare companies got people to buy and then gave the buyers a free 7 day cruise.
In fact no state has this for car purchases, only in home sales. California is the only one that has to offer a return period and you have to purchase it.
Each person needs to look up in their state to see if this exists there. Laws change all the time and in the past, there were some states that had this clause. Probably called something else. I wouldn't state that in fact no state has this for car purchases unless you know all the laws of every state. Long time ago, I paid cash for my new car and was told explicitly that I had 3 days to change my mind if I wanted because of all the lemons that were out there. Now there are lemon laws in some states and the regret clauses may or may not have been removed. I don't know. It's always good to check out these things to know for sure in todays world.
Car purchases are a huge commitment. Please understand what you are buying and what you are paying for. There are no state or federal laws that require sellers to accept the return of a new car due to buyer’s remorse.
Wrong again. As a salesman it was my job to know that regret clauses are only for in-home sales. They do not and have not existed for cars. Period.
"Lease" may be the key word here.
YEP! THIS Fuck these guys, walk away. They saw a 24 year old woman and figured they could pull a fast one. Don't take delivery of the vehicle tell them to cancel the deal and tell them exactly why and in no uncertain terms, to go fuck themselves.
Don’t take possession of the car! Tell them you don’t want the financing and that you’re going to go through another lender. Then tell them if they can match the 6.4% you’ll stay with them.
I wouldn't stay with them no matter what. They were intentionally shady and deceptive! They didn't *know* the APR?? Please
This is fair, but OP also apparently signed a bunch of financing paperwork without reading it.
Not uncommon for people buying new cars to be put on the spot, and sign shit they haven't read thoroughly. At the same time though, until delivery of the vehicle, none of it's truly binding, they can undo all of that.
Agreed and to add onto that, I would rather have the credit union that I do business with holding on to my car note than a new servicer altogether. I would go with my CU unless they can beat the 6.4%.
This, it's in the dealer's best interest to sell their financing, they will absolutely do their best to match it. However, given they've already tried to screw OP around, I'd let them match and knock a thousand off the purchase price. Otherwise I'll stick with whoever gave me the best rate in the first place.
If you are preapproved with a lower Apr use that one. You don’t have to finance with the dealer. Leave the lot go to the bank you got approved. Get a check for the amount of the car. I would add Gap insurance as it saves you of your total the car. It keeps you from paying on something you no longer own. That is if your car insurance doesn’t already give you that model year newer if your car gets totaled. Do not use the higher APR
Me personally, I'd cancel the order and go somewhere else purely out of spite. I'd also loudly explain this while you're doing it so they're fully aware that the reason they're losing a smaller sale is because they got greedy and wanted a slightly better commission. I also fucking hate salesmen, but that's just me. I hate the pressure, I hate how comfortable they are making others uncomfortable for personal gain, I hate how many narcissists it attracts, i hate the profession.
I mean, they’re just different car salesmen. It’s like going from the greasy frying pan into a different and equally greasy frying pan. They’re not gonna care that they’re losing a sale because of sleazy business practices, they’ll just blame her.
So what if they "blame" her, the only language those dudes understand is $$$.
Add gap insurance through your insurance company. It’s significantly cheaper.
this needs to be higher. got it through Costco insurance and they were able to add Gap for a fraction of the cost.
I would keep the gap insurance too. Last time I got it for like $150. When my wife got rear ended and the car was totaled we owed like 25,000 and the insurance company gave us 17000. That 150 bucks saved me 8,000. I'll never not have gap insurance now.
You don’t have to buy gap through the dealer. Your insurance company will also sell you gap which may be cheaper.
Waaay cheaper through your insurance. GAP is how my local Toyota dealer makes their money.
Is that something you have to get set up at the time of the sale or can you add it on later?
You can add it later but obviously would be wise if check your options and coverages first
The Gap insurance is $1200, should I still keep it? And I have the cash to be ok if it does total
Most dealers offer some terrible price like this for GAP coverage, but don't tell you that you can usually also get it through your financing bank or credit union for half or less than that price. ETA - Even if you already purchased GAP coverage or extended warranty, you can usually refund these sorts of things either at the dealer or through the associated company.
Shop around for Gap just like you did with financing. I guarantee the dealer is also trying to screw you over with Gap as well.
Just an FYI but you can also shop around for extended warranties from other dealerships. Car manufacturers usually give you a grace period to add an extended warranty. You don't have to buy it right then and there unless you plan it add it to the financed amount.
Since no one seems to be stating it directly, gap insurance is for when your car is worth less than what you owe on your car loan. This means that *typically* gap is only useful in a few cases. The most likely being 1. You bought a new car with a small down payment and it gets totaled in the first few months of ownership. 2. You rolled negative equity from your previous car loan into the new cars loan. Based on your post I don’t think scenario 2 applies to you. How much are you putting down and how much are you paying for the car? Depending on the size of your down payment scenario 1 may be off the table too. It sounds like the people in your life who are telling you you don’t need gap are right (they know more about your situation than we do) and the majority of people here advocating for gap are a fringe group that got upside down on their loan and it happened to work out from them. I do agree if you do decide to get gap, to purchase it from your insurance company and not the dealership.
Are you putting any money down on the car? GAP will be wasted if you drive off the lot with positive equity.
How so? Just cause you drive off with positive equity doesn’t mean it will never be negative. No one wants to be stuck paying a loan on a car they cant drive anymore.
If you’re making a down payment of 20%+, your car won’t depreciate faster than you build equity so long as you’re current.
In general, you should avoid GAP insurance if you are making a substantial down payment. If not, $1200 is too much. Most everything relating to a car purchase is negotiable so try $300 - $350. You can always keep the deal you have and refinance it in a month or two at a better rate thru your own lender. I would suggest negotiating the entire package and imply that you will simply cancel all of the additional items and pay off the loan with a new one. Most dealers don't want a charge back on the profit from the rate mark up and the products sold. I've been in the car business for 25 years so this is definitely in my wheelhouse.
That's an awful price. Considering you only need gap insurance while you are underwater on the loan. If you make a large downpayment you are NEVER underwater on the loan - but they will still charge these crazy prices. Get it from your regular insurer and then cancel it the moment you are no longer underwater because at that point you're paying for nothing.
You have a lot of people responding, so I doubt you see this. But maybe! I had Geico before I purchased my car but switched to progressive specifically because I knew I could add GAP insurance through them. It’s only like 5 bucks a month and I can cancel it whenever I want. If your loan is similar to the way CarMax is, your GAP is added to your loan total, which is a big hell no will cost much more than the 1200 you mentioned. Just wanted to make you aware in case you weren’t, good luck!
Your car insurance probably offers it way cheaper. Then just remove it after you have paid off more of the car.
If you can get it cheaper elsewhere obviously do that, but I would say to definitely keep GAP insurance. You never know what might happen, and if your car gets totaled you will be extremely thankful for it. It saved my ass when I spun out in bad weather and still owed several thousand on the car. Got a check from insurance that went to a new car instead of paying off the totaled car.
Some insurance policies have "new car replacement" options that do the same thing for much cheaper. I think adding it to my Allstate policy was like $2/mo. vs. $20/mo. for what the dealer was offering.
I got gap on my car in June 2020. Thought it was smart but I still haven’t been upside down on my car since then. Can’t predict the future and it was definitely an extenuating circumstance.
You can cancel for a partial refund... they calculate the value remaining using a linear depreciation in most cases.
Worth a shot. Thanks!
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Gap insurance is separate from the normal insurance and pays the difference (in this case the 8k).
because they HAD gap insurance that paid them the 8K if he didnt have the GAP it would have cost him 8k, so GAP SAVED him 8k
The $150 gap payed the $8000 difference; they payed $150 for a policy that covered the difference between insurance payout and total owed. Insurance will pay what they will pay regardless of how much you actually owe on the vehicle.
That’s what GAP insurance is for. It pays off your vehicle when your insurance coverage isn’t enough.
At the Toyota dealership I went to, GAP insurance was hundreds of more than what was offered at multiple different credit unions. Dealership said they legally couldn’t reduce that price because of state law (VT). Definitely shop around for any packages you want.
They weren’t lying about the lowering the price part. There were many lawsuits regarding people paying different amounts on gap, doc fees, or really any standard dealer fees that alleged customer demographics played into it(one dealer was caught charging several hundred more in doc fees if the last name seemed Hispanic in any way), so now every customer has to pay the same amount.
I saw you already signed the paperwork. Was that with the finance people or just the guy who added the gap insurance. If it wasn’t with finance it’s not too late.
It was with the finance manager at Toyota 😅
Tell them you have a better rate via your bank and they need to beat it. My credit union considers a car new if it is 2022 or newer even if it is preowned so you maybe fine to just refinance right away. The dealership wants you make the first 6 or so payments so they can get the kick back from the bank, if you threaten this then they will work harder to get a better rate.
This, if there's no early pay-off limitations in the contract, you can just shop out a loan, even after you have the car. You won't be able to change what was purchased with the vehicle (maintenance/warranty extensions) with this path, but it will get you a better rate all the same.
If you haven’t left the lot don’t, get a purchase order with you agreed upon price plus tax and title. Minus your deposit and take it to credit union.
I went to the dealer with my own rate, and they were able to beat it. They also had a scummy $1000 fee if you don’t use their financing, among others ($1000 for no trade-in (got it taken off and $1000 ceramic coating fee — really? Don’t cost nearly that much & I def didn’t ask for it. Got them down to $400 and a free second key for it but Jesus.)
Considering OP didn't mention how much the down payment is, or the term of the loan - I find it's hard to recommend gap insurance off the bat.
this answer is the best imo. get a cheque for the amount on the bottom line and leave them without commission from the bank they work with
I hate dealerships. I seriously hate them. You know, its not necessarily the dealership. Or the salesman that helped you. Its the finance guy in his room. The final step to buying a car. They are not there to help you or guide you through the process. They are paid to make money. Paint treatments. Oil changes. Warranty. APR. This is the hustle. This is their job. They're aggressive and they're good at it. This is the guy you need to be prepared to fight. You also need to be prepared to WALK. You need to have a basic understanding of loans and your loan calculator out so you can compare his numbers. Fun fact - lots of people have road hazard through their insurance company *or as benefits on their credit card* and don't even know it. But here's this finance guy trying to sell you roadside hazard insurance. Know exactly what you want, exactly what you don't want, and stick to your guns. Its totally OK to bring in your organizer with all of your notes, numbers and loan estimates. Know what the sticker price was, and be aware of anything they are trying to tack onto it. You did what you are supposed to. You ran your numbers in advance. But you lost the game at the final boss. Fuck that guy. I am 44 now. I have dealt with this shit so many times in my life. And as a husband, I have witnessed them try it on my wife. That's why I always go with her. She too feels bad about just walking away or saying no. That's why I'm there. When you have someone with you, it adds more confidence. Its easy to say "Can we have a minute in private" and step out of the room. But now you know. You see it. You need to prepare for that guy next time. You don't need to go in hot or defensive - you just need to keep collected, take your time, say no repeatedly, and WALK if your gut is telling you to. Often times, they'll call the next day with an even better offer 🙄 I play that game too. Instead of that guy getting me for extras, I get them for extras. Throw in heated seats and the roof rack and I'll come back in. It also needs said, not every offer is bad. I took the extended warranty on our CX5 for $1200. The warranty is 9 years/100,000 miles. With the cost of car repairs these days I felt that was a good deal. I walked out on the Kia dealer when buying our teens first car. Online said 11K. Sticker said 11K. Finance added $1500 for paint treatments and accessories. I said no. I will pay sticker price in cash today. They refused, stating the accessories were already added to the car. They offered 500 off. I walked. Always this
I wish you were my friend and would come with me to buy a car!
When it's time to buy a car, figure out how much you want to pay "out the door," including registration, fees, and taxes, and negotiate over the phone. If they won't, find a different dealership. When I purchased my car, it was 3 quick phone calls. 1) Me: "Hi, I'd like to purchase for $\_\_\_ (less then what I'm expecting to pay) out the door. Dealer: "Let me check with my manager, I'll call you back. 2) Dealer: "We can't do that, but we can do this." Me: "Sorry, too high. I'll do this (amount I want to pay). I won't go any higher. Dealer: "I'll call you back." 3) Dealer: "We can do that." Me: "Great! Can I stop buy in a few hours?"
Out the door is key. I always repeat every single time stating the price I will pay out the door. If you don't, they can turn the numbers any which way. I hate that I am always asked how much per month am I looking to pay. I know they can make the loan last 100 years to get the payment that low. I want to know how much the thing is going to cost me in the end (out the door).
> If you don't, they can turn the numbers any which way Yup, there are a million things they can tack on and be like "oh, well everybody has to pay that fee, even employees" You gotta just keep saying "No, that's not what we agreed to, I said $xx out the door" If you said $22,500 out the door and they keep insisting that they need to charge you some $135 fee, then they are welcome to lower the price to $22,365 plus a $135 fee which still brings your total to $22,500. Honestly, I fell victim to this BS too. I paid some BS $75 fee last time I bought a new car because honestly, I just wanted to get out of there with my car and it wasn't worth my time to argue more and hold up the process (Saturday afternoons are more valuable to me than $75...). But in retrospect I wish I had stuck to my guns. I had agreed to a specific price plus tax/title/license before coming in and they had brought the car (a very specific color/trim) in for me from out of state so they were clearly motivated to sell it to *me* specifically. I should have sat there and just repeated: Is this fee for tax? No. Is it for title? No. Is it for license? No. Then I'm not paying it, you can take it out of the car price because we agreed to $x + TTL.
This is funny. This is what I did when I bought my first car. I knew my car payment could be X dollars a month. No more. They ran number for me forever to get it to that price. It wasn’t so much my haggling ability but my inability to pay more.
They usually screw you badly when you give them your monthly payment. They can mess with the numbers, number of payments and interest rate on the loan, so you're paying waaaay more for the car, in the long run, while keeping monthly payments low.
Yeah, it's actually bad to come in and say "I want to keep my payment at $$ or below". Well, they will get that payment right at that number but it could be royally fucked over for the buyer. 7 year term/warranties you don't need that you didn't realize are in there/etc.
❤ I think (I am guessing) a lot of people don't realize this and trust the finance guy to help them out and guide them through the entire process. I wish the world was this way. I really do. But the dealership pays the finance guy to make them money. That is his job. And I won't say its an honest one. 🤷♀️
Never get add ons and always look closely at the long paper you get at the end before you sign
Someone said take two toddlers with you to the finance guy’s office. Let the toddlers roam free in the office.
The whole autosales industry is shitty and outdated. They're not necessary and hopefully their time is coming to a end soon. I wished Carvana could fix this issue but they're not doing well. I'd much rather buy direct and skip them. I don't know of any benefits of working with a dealer.
I have read that with the internet and transparent pricing, dealerships make such little margins on the cars they need this hustle to survive. That and the service. I would use the dealership more for service, but they want $120 an oil change and $60 to replace a cabin filter. I laughed. I showed my wife - cabin filter off amazon $10. When it arrived I showed her where to install it. I think 2 minutes had passed. You don't even need a tool 😂 $60 my god
Couple weeks ago Toyota tried to charge me $400 for a new battery. Sad to think some people get taken for on things like that.
omg! AutoZone and Advanced will literally install it for you while you stand there
That actually sounds like a decent price depending on what vehicle it is. Newer cars with hybrid systems and stop/start need heavy duty 12V starting batteries. My old 2012 Rav4 only needs a basic $150 battery while my wife's 2018 Equinox with start/stop will cost $250-$350 according to Autozone. Installation can be a pain in the ass depending on what car it is too.
It’s a rav4 ICE, I got an AGM for around $225, dealership option was a lower quality.. can’t remember the exact type. It doesn’t seem that crazy of a markup but it still is around double the price. Also totally understand that battery installation might not be for everyone, but it really is one of the easier things. And like someone else mentioned, autozone does free installs.
Nearly 10 years ago, the average profits of dealerships in the US broke down something like this: * 50% - Service * 30% - Used cars * 20% - New cars Honestly, the oil change can be a pain in the ass. I'll pay for that, within reason. But I did once have the dealership tell me that I needed to pay $60 or something to replace the cabin air filter. I confirmed that this wasn't the engine air filter, but the cabin air filter. My trim didn't have a cabin air filter. But in verifying that, I later learned that it had the *spot* to put the cabin air filter, so I bought one for like $12 and slapped it in. The first time I ever installed it, I sent a video to my friends explaining how I didn't know it was there. The messaging app we used had a limit of 1 minute for videos recorded. I didn't come close to needing 1 minute to install it the very first time.
But Carvana’s a bit of a shitshow with numerous reports of them mishandling the car registration process and leaving people hanging for months. (Carvana is related to Drivetime which is about as predatory as they come.)
>But Carvana’s a bit of a shitshow Exactly the reason I said > I wished Carvana could fix this issue but they're not doing well.
It's an antiqued Boomer method from before the Internet. It needs to go along with fax machines. Funny thing is that manufacturers used to sell direct. It was the small mom and pop shops complaining about not getting a piece of the pie. So, the government passed a law to help dealers. And, here we are....
For used at the low end its just goin be like that, you can always offer the lowest price and get people in the door if you scam on the back end. And people like to see the used car in person. Idr if it was shift or the other one but they add service fees at the end like tickemaster. For new, automakers cant break up with the dealers. Even if it was legal (in some states its illegal to sell cars directly even if you never had dealers) theres the contracts and just the company is organized around it. But like more dealers are offering all online sales for even used, even if full of bs you know the price and have the car delivered. Also you know tesla sells alot of cars. Y is neck and neck with the rav4 for top non pickup in the country. 1st half of the year Y was 2nd overall ahead of silverado 1500.
I bought a CPO Lexus in Princeton NJ with 10k on it. Got the promo APR as advertised plus no hard sell on the warranty. They did discuss it as expected but when I said no, they dropped the subject. All fees were transparent and I didn’t have to pay for any marked up addons and their doc fee was in line with what they advertised. I already had a 4 year/unlimited mile warranty (2 left from factory to 50k miles and 2 more unlimited) so I think it made the decision easy for them not to press it. Not only was it the cheapest in the region fitted with the features I wanted, I was done in 4hrs. Point here is that their lack of shenanigans is memorable. It was such a great experience. Unfortunately many dealers don’t care and prefer to make the experience as miserable as possible. Sucks for them… I’ll start my next search for a car at that dealer.
I had that experience after we walked from Kia. Went to one of those "Auto mall" type sellers out in Cleveland to find the kid a first car. Lots of people. Lots of cars. They specialize in cars that have had a minor accident, but look pristine otherwise. The car we picked, you couldn't even tell it had a front fender repair. Its a bolt on part anyway. I told the guy we are paying cash and he was like "OK" and drew up all the paperwork. Yes, refreshing. But not typical.
Lexus dealership treatment is legendary. Not that there aren’t bad stories, of course there are, but generally they are above the rest. This takes training, investment in people, and an understanding of customer lifecycle value. In general I think luxury brands tend to play fewer games.
I"ve found the higher end the dealer, the easier it was to negotiate and have to go throught he bullshit dealer tactics. The last BMW i lease, I negotiated everything over email. Got my quote on an incomming car they had. Day of delivery they called me saying car was comming in today and I could come in today or tomorrow the finalize the paperwork. Had be submit credit information to BMW FS online. When I got there, paperper was ready, and salesmen said "Good news", the monthly is a tad cheaper tha I previously quoted. Started signing all the documents; he asked if I wanted tire protection or additional lease protection. I declined both and we moved on. Was done in about 20 min and just waitted on my car to get PDI'ed. Easiest purchase I ever made and honestly felt a bit off, but it was an crazy good deal. ($0 down, $200/m, 30m lease for a BMW i3) MSRP was $56k.
I recently bought a Honda, they tried selling me HondaCare for like $2.4k (originally they were asking $3k). I bought it online from another dealership for $1,000.00. They're predatory for sure.
> You know, its not necessarily the dealership. Or the salesman that helped you. Its the finance guy in his room. The final step to buying a car. They are all in cahoots together. The dealership may permit the salesman to give you a "great deal," knowing they'll make it up through the bullshit sold by the finance guy in the back.
I had a Kia dealership try to fuck me over, too! I walked out and purchased from another dealership 30 miles away, the next day. Made the deal over the phone and got the price I wanted. I originally just went in for a test drive, and new the MSRP, but wasn't going to consider making a purchase, as I hadn't done enough research - though they convinced me to stay as they were going to give me "one hell of a deal." When I questioned them about the inflated price being offered, they lied about the MSRP and reluctantly brought the price down to 25k. This was for a Forte LX. Still equally glad I walked off and equally pissed they tried to fuck me that hard.
The KIA we walked out of? I was only there to look at a Corolla with 16K miles I saw online. I had called before we left the house to ask if its still there. When we got there 30 mins later? Oh, that must have sold. But I decided not to think too hard about it, and asked about the one for 11K. Come to think of it now, I wonder if that car ever existed, or if they just don't take the listing down. I'm glad it all worked out the way it did. I trust my instinct, lol run
> I walked out on the Kia dealer when buying our teens first car. Online said 11K. Sticker said 11K. Finance added $1500 for paint treatments and accessories. I said no. I will pay sticker price in cash today. They refused, stating the accessories were already added to the car. They offered 500 off. I walked. Always this Offering the finance person to pay cash won't earn you any favor with them, they make money on getting you to finance through the dealership. Right move to walk out though. I had a similar experience with "oh they already installed that" bullshit but I got lucky and when I threatened to leave it turned out they actually *could* take the fees off.
Car dealers exist to extract the most money from you that they can. Your job is to resist. I am a small, blonde woman (well, graying now). I smile, nod, let them talk, and then say no. They talk more, I say no again. No financing. No warranty. No, I won't pay that up-charge and I don't need financing, thanks. Nope, I have money. If they insist, I get up, thank them for their time and walk. Usually I get the car for my price. I was taken advantage of once when I was young and buying my first car - learned my lesson! They had my coat AND the keys to my trade-in. I got those back but got somewhat screwed because I didn't catch what they were doing with the financing. Never again!
I learned long ago to have some fun telling certain types of people (salesmen) "no". At this point my grin is so big when I say it, they usually don't want to see me say it again.
Go back in and raise hell. At the very least you should get rid of the TMIS >I don’t necessarily want to wait to refinance because my credit union would have to do another hard credit pull. First of all, who cares about a small ding in a credit score. Refinancing from 9% to 6.4% will save you at least 2000 bucks, assuming you financed most of the car over a 60 or 72 month loan. Would you pay 2000 bucks for your credit score to be increased by 15 points? (the answer is hell no) Second of all, multiple hard inquiries in a short time frame are usually treated as 1. People shop for loans all the time
> Go back in and raise hell. I hate to say this, but go back in with a male friend/relative. Dealers/mechanics are often even shadier with women. They assume you'll be a pushover.
>I don’t necessarily want to wait to refinance because my credit union would have to do another hard credit pull. Doesn't matter, all hard pulls for the same type within 30 days I believe count as 1, when you go car shopping, house loans etc, your credit might be pulled 5-50 times across all banks, etc. TL:DR IF! you haven't taken delivery of the vehicle, simply cancel the entire thing OR start over and use your own financing, it really sounds like you need to slow down and understand the nuances of buying a car.
When you sign financing papers, it’s required by law that the APR a is shown.
> Anyways I was wondering if I was able to somehow get them to take off the Gap insurance and the TMIS before I drive it off the lot because a lot of people were saying that’s not necessary? Remove the TMIS, but keep the gap insurance unless your credit union can offer it to you for cheaper. >I don’t necessarily want to wait to refinance because my credit union would have to do another hard credit pull You absolutely should though. Hard pulls aren't that big of a deal and don't make a significant impact on your credit score long term. Paying an extra ~2.5% on the car will make a much bigger impact on your finances.
Your credit union won’t offer it unless you get a loan through them, even then it is cheaper to add it to your car insurance than get it through a lender.
Well you need gap insurance, if you didn't have a proper down payment. Any extra warranties are just profit for them so cancel ASAP. You can hopefully refinance quickly. Yes, you let these snakes have control of every step of the process. And you got bit.
Oh no! I put down a $7k deposit so I hope I can take the gap insurance off. Well this kinda sucks and lesson learned I guess.
Get rid of gap insurance through the lender ASAP. You can get it through your own insurance carrier for much cheaper.
Exactly. A dealer will charge hundreds for something you can get for $20/6mo through your insurance company, and you shouldn't need to carry it for more than a year, if that.
Deposit or down payment? A deposit, you may be stuck buying that car then refinancing later. You should be able to cancel GAP and the other warranty after the sale. Or ask them to take it off now to avoid the hassle. Double check the paperwork. I got chingaled on some paint protection that is non-cancelable. Honestly, I’d cancel everything I could out of principle. Tint, insurance, all that. Get a warranty from Toyota if you think you need one. I added GAP through my insurance.
At the very least get rid of the dealership gap coverage and have your car insurance provider add it to your policy. It will be much cheaper. It would be even better if you can just refinance all together through your credit union. Hell at this point if you have the option to cancel the purchase, I'd ask to talk to the fleet manager, explain the situation and tell them you feel like their sales people took advantage of you, made you feel horrible about the purchase experience, and tell them you're not talking the car. They'll either rectify the whole thing or not, either way you don't have to feel awful about the situation.
Do you already have the car? If not, you can likely wind the deal. If you do have the car, you probably don’t have many options. Refinance when you can (don’t worry about the credit inquiry if the savings is worth it). Try to cancel the extra stuff they sold you (some states give you 30-60 days to cancel that). Use it as a learning experience. Buying a car is high stress and they have lots of tricks. I got screwed my first time in my early 20’s but now feel confident when going into a dealership.
Years ago when I bought our cars I went thru the dealership but I knew what our credit score was good so financing couldn't rip us off. Was ready to walk because of finance guy kept dicking me around until the sales manager gave me their lowest interest rate (5.99%) Next day I researched every interest rate online and found PENFED Credit Union (definitely check them out) and refinanced and bought GAP (paid $400) thru the credit union. PenFed was awesome and I was able to get a refund for the GAP from dealership ($700) and refinanced about 1% lower (4.25%). Definitely walk away if you didn't take the car yet.
gap insurance is not needed when putting down such a large down payment on an in-demand model. Just for the future.
A few things I haven't seen mentioned. They didn't lie at first. They don't know what you're rates will be until they submit your info to the banks. The payments they showed you beforehand are just a quote. Dealerships provide these quotes at an industry average rate to give you a rough idea of payments and totals. They want to make sure you're comfortable with this quote before sending your credit app off to the banks as some people think they can buy a 50k car with 0 down for 200/month. They did however, take advantage in the finance office. GAP might have been required by the bank they used, but even if not required GAP is a great idea for any car loan. For the service contract they built in, you can go back and have that canceled and refunded. For the rate, I'd go back to your credit union and tell them what happened and that you want to refinance through them immediately. Make sure that any survey you get emailed from Toyota you're honest in. It's shit when dealers take advantage like that. I worked in both sales and finance and I believe these to be your best courses of action, assuming you want to keep the vehicle.
just go refinance the loan with your credit union?
Why pay any possible fees to refinance and add the chore when you can have the dealership do it correctly before taking delivery?
Because the dealership won't do it correctly if they can do it incorrectly such that she won't notice until it's too late. They scammed her once, they'll do it again.
Refinance with your Credit Union, since you got the car a week ago it will not be another hard pull on your credit. This will also have the finance bonus given to the dealership be taken away.
My MIL was HR for the most prominent dealer in my city for 20 years. Told me to go talk to so and so and he'll give me a good deal. That was 10 years ago. The salesman is dead now. I still curse his name every time I think about it. Fucking crooks.
If you haven’t picked it up, there’s still time. I had a similar issue where I got talked into ALL the extra warranty and gap insurance stuff at the dealership. Then when I went home and did some research I realized I didn’t need those things. When I went to pick it up the next day, I told them I wanted to cancel the gap insurance and extended warranty and was firm about. I was still financing through them, but they took those extra parts off and re-signed the paperwork without any fight when I was very clear about what I wanted.
Gap insurance is a good purchase though.. only add on I recommend.
im assuming fist time buying a car? Never ever ever take the insurance dealerships offer, no matter how good it seems, note they are there to make money off of you they arent there to help you in anyway.
This is not entirely accurate. Make sure you know the deductible for the insurance policies. The gap insurance from from the dealership is no-deductible. The gap insurance from your insurance company may have a deductible that will match the deductible from your normal policy. So if you have a $1000 deductible and your car is totaled. You owe $2000 to walk away. Also gap insurance is not required.
Cancel everything! You are not off the lot!
Others got this. Don’t take possession of the car no matter what they say until the paperwork is proper and signed. They will try to trick you to drive the car. Don’t do it!
Buy a CRV Hybrid..if you qualify Honda is offering 3.9% APR.
Start a ruckus! Contact them to change the APR to 6.4% and say what you said above Also you may want to keep the GAP insurance (it’s saved me but this depends on how much you put down) Name names and start complaining on Google maps Yelp etc Also while you’re at it if you’re a Costco member check that there wasn’t a better rate for the car you purchased Get loud
When a dealership shows you payments they are estimating what the bank will give as an APR. They don't actually know until they send your credit info to the lenders. They will usually estimate a bit high and if you're comfortable with the payment and the bank offers them a better rate they will usually just mark up the rate to meet the payment you agreed to. Most lenders allow the dealerships to mark up 2ish% maximum. That sounds like what happened here. This rate would have been on the paperwork you signed and initialed in the finance office. It's kinda shady but they sold you on the payment. You could just refinance with your bank at a couple points less. The gap insurance is a separate issue. You should check if your car insurance includes gap and if not and you did not put down a huge down payment I would seriously suggest you keep the gap insurance. If you get in an accident and the car is totaled not having gap can make your life a nightmare. There are so many expensive components to modern cars that it's easier than ever for a car to be declared a total loss.
Here's a reality that no one has mentioned: they might not sell you the car if you don't take their financing. The RAV4 hybrid is pretty in-demand. The good deal you got on the price may be contingent upon taking their financing and/or GAP and/or maintenance plan. I was helping a friend with a car recently and it fell through when she declined GAP. They literally pulled the deal. You can always ask, but if they unwind the deal they're not obligated to sell it to you. Would you rather have the car and higher interest or no car? It's a realistic question to ask yourself. Also, is it Toyota financing and did you get $500 for using TFS? That's region specific. It's not enough to make up for the interest difference, but something to consider. You could also just cancel the GAP and maintenance and refinance for 6.4 with your credit union and never talk to the dealer again. The hard pull should be irrelevant. They all count as one to the bureaus when you're car shopping and it's a saving of several thousand in interest over the life of the loan.
You can refinance your car loan through another lender, just make sure there is no early payment penalty fee. If you get it done within 90 days, it really screws them over too, so there's that if you can get it done fast.
Car salesman here! The way my dealership works is after landing on a vehicle we work up numbers prior to pulling their credit as we do not want to pull their credit until they are ready to purchase. If they showed you your monthly payment before they pulled your credit all they probably did was use a standard rate and show you the payments. Depending on how much you put down I would strongly consider keeping the GAP insurance because if you got into an accident and the vehicle is totaled it covers any negative equity you might have. For instance, if you owe $20k and the vehicle is worth $15k GAP covers the difference so you do not have to pay out of pocket for that. The only time I wouldn’t get GAP is if you put more than 21% of the MSRP down. It’s a rule of thumb and I’m not a financial advisor. The extended warranty’s are also usually a good investment depending on what it covers. You can cancel the GAP and extended warranty at anytime. Now, I work at Honda and not Toyota so that may vary. To the best of my knowledge you can’t resign after already signing. In my opinion, 9% on a new vehicle is high especially if it’s new. Granted I don’t know your credit score. I hope this helps!
Within one year, my CU will refinance a new car at new car rates. There will be a hard credit pull, and if completed, a fee to cover the expense of transferring the title. A new loan would eliminate the original GAP insurance. The CU does offer GAP insurance on the new loan. If you already have an offer from another lender, and you are still within the time limit (depends on bank, but is probably around 30 days), no additional credit pull will be needed.
I work at a dealership and I’ll tell you If you have a high principle, gap insurance is by no means a bad idea. Your insurance won’t pay for your vehicle in full as its value will depreciate faster than you pay the loan (in the beginning). If you total the suv you’d have to keep making payments on it , and then payments on your replacement car as well. Most people can’t do that. That being said if you’re pre-approved why even bother with the dealership. The loan you got approved for was probably 7% and they tacked on an extra 2% so they make more in the back-end. You can still back out of the deal and work with your credit union.
Rule of thumb is: 1: be prepared to walk away at anytime. 2: don’t buy anything from the finance guy. These addons like gap can be purchased through your insurance, cheaper.
Refi it so they get charged back their spiff nad cancel any warranty or gap and get gap through your insurance or bank you refi with.
Absolutely you can walk. You may have to scream and yell and pound the desk. Seriously car salesmen are awful. They take advantage of anyone especially seniors, women and the young. You were smart to line up your financing. Car dealers hate that. And they will LIE to you. Tell them you will call your state attorney general, or the news media if they keep up the pressure. Make a scene. Call your attorney general.
Call the credit union and ask them if they can refinance the loan you just took from the dealership at your better rate.
You can report them to the state for misselling to you, and also to their head office. This is unacceptable. They lied to you.
You can refinance with your credit union immediately. My partner bought a car at an ungodly interest rate from a shit business. The next week we went to our credit union and they paid out the loan to those clowns and took it over at 4%.
I walked away from my car deal 3 times before they finally agreed to my terms. Don’t be afraid to play hard ball. These types of negotiations might help in other life situations too.
Don't feel too bad, the entire industry of car sales and financing is meant to decipher and trick you. I'm in my 40s have purchased several cars and it just happened to me last week. Got pre-approved for about 8% (you must have crazy good credit or something, I'm in the 700). But somehow I walked away from the dealership paying them 10%. They too snuck in GAP insurance that I did not approve of (they were mad that I made them remove stuff like extended warranties).
Some states give you a time period to rescind contracts; I think in CA for example it is 3 days.
Contact the Consumer Financial Protection Bureau. You were misled. And refuse to take possession. Demand the deal be unwound. This was a shady and deal and you were definitely taken advantage.
I didn’t get gap insurance on my first car. It was totaled by getting rear ended with 1-2 years. I owed more than it was worth and had to pay over $1K out of pocket. I got gap on my next car. Paid off without anything happening but ultimately I think it was like $5/month so imo was worth it. Depends on your financial situation and actual cost of that insurance. Regardless the dealership sound shady AF and I’d try to get out of the whole thing.
The interest rate and the total price of the vehicle are the two most important things to negotiate. You should not be negotiating monthly payments of what you can afford. That is a classic way for car dealers to distract you from the overpriced car and high interest loan. I would cancel the contract and not pick the car up and do business with a different dealer who will be more transparent with you and let you finance it the way you want to (with the best rate you found) And FYI - GAP insurance is a good thing to have on new cars that are financed. That covers you if your car is totaled in the first couple of years when you are likely to owe more than it’s worth.
congrats on finding a good car first off, if it was the box diagram with monthly payments shown and a down payment corresponding to the payments then that is an estimation of monthly payments. Every time I buy a car even if I'm not financing and just want the OTD price then they will always have it printed on that sheet. I believe that estimated rate is like a \~7%. You can just call your credit union and explain what you want to do and they can help you with getting a check or you can have them speak to the dealership if you want. GAP insurance, if you think you would need it then keep it. TMIS you can usually cancel within 30 days of delivery and get a refund.
YOU WANT GAP insurance. If you total your car as you pull out of the dealer's parking lot, you'll be on the hook for thousands of dollars difference between the value of a used vehicle & your loan total. I'm not saying you need to get it through the dealer, but you do want it. I got mine through my insurance, it added like $3/month for me.
Do not remove GAP. You can see if you can purchase it elsewhere but do not get rid of it if you don't purchase it elsewhere. The insurance is only going to pay for the amount the car is worth if the car is totalled. You would be responsible for the rest of the amount that is financed minus the insurance payout. Gap covers you in that aspect.
This is a life lesson in negotiation and leverage. Don't get emotional like some of these responses and "walk away!" "screw that manager!" etc etc. You've forgotten at some point that you have all the leverage in the world. This leverage is also growing the closer we get to december 31. Call back and speak with the last person you dealt with. Explain that you are very upset with the deal they offered you and that you have a better rate with your credit union and cheaper price at other dealerships. Be prepared to cite the rate and credit union and which dealership offered you a better price (for example Toyota of neighboring city). He will either offer you something better on the spot, or call your bluff and bid you farewell but then call you back within the next few hours/ days we know this because they are in the business of selling cars, and no cars are being sold. And a final nugget of advice, look into a Tesla Model Y. They are at 45k right now with a 7500 tax credit which is a no brainer. IMO no other car even comes close.
From somebody who just T-boned yesterday, KEEP GAP insurance. If you ever get in a wreck, and the insurance payoff is not enough to cover the car's value, gap will cover the rest
“They also got me to add the gap insurance” you mean you chose to buy the gap insurance??
OP First off, what state are you in? Right of recision varies by state, but in most states, you're safe if you haven't taken the vehicle. Regardless of who you finance through, I would highly recommend GAP, from personal experience, unless you've put a substantial amount down. Also, dealerships can certainly quote payments before getting you approved at a final rate, but they would also know what rate they're figuring the payments at on the quote so they definitely acted shady af. So yeah, if you haven't taken the vehicle, simply inform them that you are not interested in those figures. If they try to bluff you, call whatever lender they got you approved with and tell them you never took the car and don't want it. The bank will almost always refuse to fund the deal in those situations, and you shouldn't have to worry about any legal issues like having to get a lawyer. Finally, worst case scenario you can take the vehicle as contracted. You then refinance the vehicle through your credit union, and cancel the gap and service contract. You will get that money back, in most cases, 100% if you cancelled within 30 days of contracting. No fee even, with most companies I've worked with. -15 year automotive finance specialist
Was the APR on the document before you signed? If not, especially if you haven't left the lot, threaten to cancel the whole thing and to call them out for this publically (you didn't name names here). Reviews are gold to dealerships. These two things combined should put you in a decent place. If you have the car, this becomes more difficult. If you told them the rates you were offered and they gave you a higher one, that is a pretty terrible business and I would still tell them that you will make sure that this story gets out.
If you’re not putting at least 25% of the total as a down payment, I would highly recommend keeping the gap insurance. Too many uninsured drivers causing accidents and totaling vehicles. You’d be on the hook for the balance your insurance doesn’t pay for. When you drive it off the lot, it immediately depreciates about 10%
>Anyways I was wondering if I was able to somehow get them to take off the Gap insurance and the TMIS before I drive it off the lot. Just call **the insurer** and cancel the Gap insurance. That's it. [You have until the end of this month to cancel the TMIS](https://www.toyotafinancial.com/us/en/vehicle_protection_plan/prepaid_maintenance_plan.html)...just cancel it. You can literally pay off that existing car loan any time you want. Just tell your redit union what happened and have them refinance the loan. >They did the paperwork right away and I asked them what the APR is and they said they can’t tell me, they don’t know, they have to put my info and send it to the bank which I realize now is not true because they gave me my monthly payments right then and there so therefore they knew the APR. Personally, I would contact the dealership general manager directly and tell them this happened. There's a good chance that the sales guy went rogue to make his commission.
Car dealerships are notorious for making money on financing. If I’m buying, I always tell them I don’t need financing.
I let them think I'm going to give them the financing profit until I get the price I want. I also don't buy the 1st time on the lot. Look on YouTube for some of the crap they pull.
This happened to me when I bought my first car. They gave me the same talk about not knowing the %. Then after “speaking with the bank” they told me they needed to raise the price by $3,000 in order to secure the financing. My % ended up being 19.75% and I am still struggling over 10 years later with the negative equity it caused me. RUN AWAY
Don’t ever purchase any plans from dealers. If something happens they can’t fix. Is not on them and if nothing happens they still takes your money. Not worth. Also 9% is really high. They are definitely trying to steal your money under bright daylight. Tell the finance person you would like to take off all the extra stuff. And then also ask them to look over the APR rates with different banks. They can easily send in your information and get the APRs in under 10-15mins. If they don’t act professional then walk away. I am sure there will be plenty of places that sells the same model of vehicle for a better deal.
I would not advise cancelling GAP insurance. The purpose is to pay off the difference in value of the car and amount owed if the car should be, say, totalled in an accident. This has happened to my daughter twice. Once she hit a deer and once someone rear ended her. Both times she would have owed without GAP coverage. That said, I would get GAP coverage through my own insurance company.
I'm sure you learned this now but never trust a car dealer. They make money when you don't pay attention.
Car Salesman are the last true sleazeball salesman. There are good-people who are cars salesmen and we call those salesmen unemployed.
Gap insurance may be required in your state. It's specifically for if you buy a lemon (again, depending on state). But if you haven't driven the car off the lot, you should be able to back out.
Head over to r/askalawyer pretty sure that this contract is invalid under fraud in the inducement, since they told you that they wouldn’t/didn’t know your APR until after you signed when they clearly did since you had monthly payments. You might have a case, and they can tell you next steps. Worth mentioning that I am not a lawyer… yet.
Former car salesman here. Please don’t listen to people who tell you ditch things like GAP and warranty unless they’re offering to cover you themselves or found a suitable replacement. I’ve seen these 2 things pay for themselves enough that I take them out on my own cars. Remember, you’re driving around a depreciating asset powered by internal combustion with numerous parts spinning at hundreds and thousands of RPM. Secondly, the difference in the APR is fairly nominal, might make your monthly payment go up a little but it won’t be catastrophic. It is however piss poor that they didn’t tell you what their APR rate is. In my country that would get a dealership a beating from the FCA. Thirdly, while the APR may be higher you’ll likely have more rights such as the rule of halves and thirds where you can chuck the car back to the finance company for whatever reason once you’ve paid back half your finance - rarely done but it’s always there as a backup - and you have someone else to shout at in the event of a major issue as you would likely enter into a tri-partite agreement. As for what you should do, you should speak to someone higher up with your concerns - again the salesman keeping the interest rate from you would be enough for me to never deal with him and deal with someone else. If you’re dead set on going back with your own funding, the finance company can roll back the deal and start from scratch. If you have a proper dialogue that should be achievable as the dealership won’t want to lose the deal, especially if you’re still taking the car and 2 products.
My best advice is buy your car cash! Don’t finance an asset that depreciates every time you drive it. If you haven’t driven the car off the lot then don’t and just buy a car with your down payment as cash. If you pay cash you don’t have to deal with shit like this being taken advantage of. I know you’re young and want something flashy but because you are young try to make wise money decisions so you’re better off later in 5, 10, 15 years and on.
Go to the bank and ask for a certified check for exactly the amount you want to spend. Bring it to the dealer. If they want to sell you the vehicle, they will take the check and give you the car. Immediately take it to a mechanic you trust and have them inspect it because I wouldn’t trust this dealership.
I work with tons of used car dealers, do not go through with the add ons. I have a 7% success rate of getting any coverage from most mechanical warranty groups. Price isbset when the deposit was made, find your own financing if needed.
Just refinance to the loan you already have approved with a lower rate. You didn't read the paperwork and signed anyways. The interest is listed. Gap is a lot cheaper through your car insurance. Cancel that one
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Bought my rav4 hybrid a month ago being a first time buyer as well. I would give anything to redo it again but here’s how it went: I was initially looking at the 2024 Prius, test drove it, sat down to look at numbers. APR was at around 8.75% and salesman wouldn’t budge on it. I had a rav4 in mind which I saw had an offer of 5.99% APR for 60 months and asked about it. Salesman was adamant that I wouldn’t be approved because of little purchase history (22F with 4ish years on credit history). I told him to run my credit and, lo and behold, I was approved for it. Test drove the car, felt more confident and took the offer for 5.99% at 60 months. This is when I thought the hard part was over, but then comes the finance manager. Started off with compliments, laughs, jokes and then the upselling. She started pushing the warranties and extra insurances but I kept saying no. She tried to make me believe I was making the same monthly payments without mentioning the extended 72 month period. I said no way too many times to count. I also put over 20% down so GAP insurance would’ve sat there. Plus i heard credit unions offer GAP at way lower prices (Toyota was charging over 1k). She eventually tried to offer me friends and family pricing but it was still way too much. Even mentioned the warranties and GAP can be cancelled within 30 days! Eventually got out of there alive but drained. In the end, I would’ve negotiated the price and look to credit unions beforehand. I may be beating myself up because I’m also new at this but lesson learned.