# Garage Car Finance Deals



## Annabell (24 Jan 2007)

Does anyone know of any good Car finance deals that dealers are offering? Are they better than a bank?


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## RS2K (24 Jan 2007)

An interest free one is.

Opel have one of these I think.


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## Mr2 (24 Jan 2007)

Heard the 50/50 deal opel are doing is very good, But its provided you have the 50% to put in up front, So it depends on your trade in value or cash you have or ssia's etc.


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## Thrifty1 (24 Jan 2007)

Opel do a 50/50 as mentioned and also a 12/24/36 month interest free deal.

If seeking 100% finance you can only avail of the 12 month one otherwise for all its 50%

One main advantage of going with finance arranged by a garage is that they will apply to a few different banks and get the cheapest quote for you. They get a discounted rate sometimes which you wont get with you own bank unless you are staff.

There are some great deals on Colts and Pajeros as well.


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## levelpar (24 Jan 2007)

Hi Annabell  My granny always told me that there is no such thing as a free lunch . No one ,not even garages, borrow money for free so I guess that you pay the interest out of the discount you would have got if you went in with the money yourself ,ie, credit union cheque etc


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## CCOVICH (24 Jan 2007)

Thrifty1 said:
			
		

> One main advantage of going with finance arranged by a garage is that they will apply to a few different banks and get the cheapest quote for you.



Is this really true?  I have seen several dealers where the price signs on cars come emblazoned with a finance provider's logo.  I wasn't aware that they would have mutiple relationships.

I would advise anyone to shop around on their own first and then see what a dealer can offer.  They are more than likely on commission from the finance provider and so have a vested interest in promoting one provider over another.


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## levelpar (24 Jan 2007)

> have seen several dealers where the price signs on cars come emblazoned with a finance provider's logo


.


I would agree with above. When ,some years ago, I went regarding finance, the garage dealt only with one particular finance company. Recently, we were ushered into an office where the person behind the desk was not ,as we thought ,an employer of the dealer garage but, in fact ,we discovered an employee of a building society who was  led to believe that we wanted car financing. 
By the way, the building society guy tried to convince that we were foolish to pay cash


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## bacchus (25 Jan 2007)

Be carefull, dealers offer purchase agreements, not car loans...


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## demoivre (25 Jan 2007)

bacchus said:


> Be carefull, dealers offer purchase agreements, not car loans...



Agree and it's important to understand what you are signing up to. Some car financ options explained in .


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## redchariot (25 Jan 2007)

Best way to go is with a personal loan from a bank/building society etc; much less expensive than hire purchase; you can decide at your leisure which car you want then.

By all means go for good finance deals at the dealer if they are available for the car you want. Interest-free is great if you can fork a pretty big cash sum up front but in a lot of cases that will not be an option.

Also, do not go for a car just because you can get a good finance deal; it has to be the right car for you too!! Remember that after a house, your car is probably the most expensive purchase that you will ever make


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## GreatDane (25 Jan 2007)

CCOVICH said:


> Is this really true? I have seen several dealers where the price signs on cars come emblazoned with a finance provider's logo. I wasn't aware that they would have mutiple relationships.
> 
> I would advise anyone to shop around on their own first and then see what a dealer can offer. They are more than likely on commission from the finance provider and so have a vested interest in promoting one provider over another.


 

That certainly sounds about right, but one is forced to ask .. if the car dealer is selling finance and on commission, who ultimately pays & could a better deal be obtained elsewhere ?


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## CCOVICH (25 Jan 2007)

Garrettod said:


> That certainly sounds about right, but one is forced to ask .. if the car dealer is selling finance and on commission, who ultimately pays & could a better deal be obtained elsewhere ?



And if it wasn't clear from my post that is the point I was trying to make!


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## Thrifty1 (26 Jan 2007)

While some garages might be tied to one particular bank/finance house not all are, if you see one logo emblazoned on the car then fine but if not then it wil probably mean they deal with a few.

Garages get cheaper finance from the banks as they put so much business their way, this saving gets passed on to the customer.

Most Business Managers are employees of the garage, ask if in doubt, personally i would steer clear of ones who are employees of the finance provider as they have the obvious affiliation and you will not get the best deal.

Price lists are available for new and used cars, so you can see the price in advance, it doesnt make a difference whether you pay through a finance application or cash.


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## GreatDane (27 Jan 2007)

CCOVICH said:


> And if it wasn't clear from my post that is the point I was trying to make!


 

LOL 

TBH, it was clear imho, but I could not resist the temptation to reinforce the point further.


Interesting comments from Thrifty1 above. I can tell you from a couple of experiences I, along with family & friends have had over the last couple of years, the garages have often done everything, bar lose the actual sale of the car in question, as part of their quest to secure the finance ... in one instance, I can tell you a certain well known Dublin garage actually told the customer they would not sell them the car, unless the finance was signed up through them (basically the finance was being provided by a certain bank, with whom the garage also had an "agency" and as such, if it went through the garage, the garage would get commission ... regardless of the fact that the person was a well established bank customer getting a cheaper rate etc)

Thrifty1, I'm not sure if you have relationship with a garage, work there yourself etc and am not trying to push you here, so please don't misunderstand me. However, for the sake of the discussion, would you please check when opportunity arises to see if:

A) the garage(s ?) you are thinking off get commission for selling the finance

B) contact the finance provider and get a quote on the same basis as the garage(s ?) you are thinking off and confirm for yourself & perhaps us, that there is indeed a discounted rate from the garage.

Perhaps, when time permits & if your willing you might let us know your findings, as obviously this could be helpful for us all if you can support the information and share your findings with us etc ?

Many thanks for the work you might put in here for us 

Cheers

G>


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## Thrifty1 (27 Jan 2007)

Hi, i used to work for a garage a few years back.

Yes the garages work off a commission for selling finance, thats usually how sales work.

They do get discounted rates from the bank, the garage do add on obviously in order to provide this service they have to make something themselves.

Obviously if you have a great relationship with your own bank and get a low rate from them by all means go that route you would be mad not to and i would never have encouraged or forced people to do otherwise.

Organising it with a garage has its advantages though. They do the leg work and all the paperwork involved, you dont need to contact your bank, call into them, etc.

The garage (most anyway) will deal with a number of banks, so where you may be declined with one, you also may get passed with another.

For most people if they were declined with their own bank (either bad history, reached max loan amts, not strong application) they would probably not contact other banks for the loan.

Organising finance in a garage is convienent, you can order your car and finance under one roof, even on a Saturday and get approved within an hour.

Once you are approved if your car is available you can take it away immediately, otherwise you need to wait until the bank lodge the money with the garage, which can take up to 2 weeks.

It is unfortunate that some people have had bad experiences with regard to this, if i met someone that pushy i would walk away no question.

At the end of the day its a service and if you get a better service elsewhere then choose it.

Some people are concerned that if they said they want finance to a salesman he will up the price, this doesnt happen, but if you have this concern leave it until last when the price is agreed.

Hope this clears things up.


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## ixus (27 Jan 2007)

I used to work in one of the car (asset) finance companies. 

Basically what would happen was this :

A person would agree a price for a car with the dealer. 
Dealer (if not tied to one finance company) would take details i.e. name, address, occupation, what is being purchased, the value, loan required, is the purchaser putting in a deposit/trade in or is it 100%.

This information would then be faxed to several car finance companies. The company would then run a credit history check on the consumer and depending on how all the variables add up would offer a loan. 

Now my understanding of how a dealer would operate would be this:

Which finance company got back to them first.
Which company gave the better commission to the garage. 
The garage would also look at how many deals or how much finance they have done through a particular company. They like to give business to each finance company to keep each one happy. So company X might have 100K's worth of loans while Y might have 75K's worth. The car dealer might opt to bring Y's level of finance up to keep them happy so would offer Y's loan approval to the customer.
Another factor would be who the dealer has loaned with for the construction of their building. They might have a quota of 500K worth of loans per year to put through company X as part of the deal to get the loan for the building. 

If you get loan approval from a car dealer and you know your credit history is good. Take your offer, go to your bank and see what they offer. Play them off against each other and get your monthly repayments down. This does work.


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## Mr2 (29 Jan 2007)

IXUS "Another factor would be who the dealer has loaned with for the construction of their building. They might have a quota of 500K worth of loans per year to put through company X as part of the deal to get the loan for the building."  What sort of thing is that to say? Have you first hand experience of this or is this what you think happens? 

Salesmen sell cars at a an agreed price and once that's settled your asked how are you going to pay for it, Ie. cheque, cash, etc. If you say your not sure they might say do you want to talk to some one in the in house finance office, which is a service the garages provide but if you take up of course with all services there is a charge. They give the details to all the banks to see who will pass who, In that they might send it to 5 companies but only one will pass you and that's the one that will be offered to you. Bad history or a lot of loans = higher risk and higher rate. If however you go to a car supermarket those are usually tied to one finance company and the the rep in those work for the bank and maybe that's where people are getting confused because those markets are getting more popular.


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## ixus (29 Jan 2007)

Mr2 this happens. If a company X was to lend you 3 million to establish and construct your car dealership and they are also in the business of providing car loans. X is going to expect you to pass a large amount of business through their way. The finance company is not just going to say "here's your 3 million as long as you can make the repayments there's no problem best of luck selling your cars!". 

They look at the bigger picture like, what other kinds of revenue are to be gained by providing this large loan? The finance company will say " you want 3 million? We'll give it to you at a better rate than company Y as long as you send more car finance business our way". I did say I previously worked in an asset finance company didn't I?

There's nothing wrong with the above scenario, I was just explaining how these things work.

Also, what happens in the scenario of 5 loans being sent to seperate finance companies if the 5 accept the loan applicant? The car dealer is invariably going to go back to the customer with the deal that gives the dealer the best rate. 

Yes the price of the vehicle has been agreed but if I buy a car for 10K and take out a loan, I'll end up paying more than 10K while the car dealer will get the 10K and the agreed rate between him/her and the finance company.

I fully understand the concept of credit risk and that everyone is entitled to a fee for their services. I haven't said the car dealer was evil or anything of the likes. Just given my understanding of how asset finance works in the motor industry.


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## Guest111 (29 Jan 2007)

When I bought my last car the guy tried to persuade me to take out a loan rather than just buying the car! I presume a lot of these sales "professionals" get commissions from the likes of GE etc?


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## bacchus (30 Jan 2007)

Interesting GE reading here.


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## Mr2 (30 Jan 2007)

IXUS, I'm afraid I really have to dis-agree with you, Most garages I know have there dealing's through AIB bank and there new building loans also,however most people with a good history are given finance with Bank of Ireland or Lombard because the rates are better.

bacchus, I've read that it might have been a claus on the policy when she took it out that if she didn't go full term there would be a penalty, As there is if you change banks for you mortgage or if you pay off your T.V. in dixons.


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## ixus (1 Feb 2007)

Mr2 : If you dis-agree that's fair enough but I'll stick to my guns on this one. 

I'm only giving people a view of what I have learned from working in the industry and attending meetings where this has been openly discussed. I don't really have much more to add after that.

Ixus


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## Mr2 (2 Feb 2007)

Ixus that's fair enough, After all you did only work in One single "car (asset) finance campany" and every orchard has one rotten apple. I've worked for 10. Was this place you worked in so maybe I can get a  clearer picture you can pm me if you don't want to name the place on the forum.


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