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justhereforpics1776 t1_jaf1con wrote

I would personally find a new dealer. That is wild as a policy. I’m guessing it is a small dealer and not a large one part of an auto group.

Buying a car already has enough paperwork. Let alone you buying it, waiting 2-4weeks for the new lion to be set up, and then getting a whole new loan

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Puzzleheaded_Put534 t1_jaf4ewj wrote

And remember each financing bank is gonna have its cut in fees to process the loan.

Go elsewhere, unless they're borderline giving you the car for free

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fluffy_bunny22 t1_jaf23ir wrote

Unless there's a very specific car there that you can't find anywhere else I'd find somewhere else to buy a car. There are 2 of my cars dealers in my area. I don't like who took over my dealership so I don't deal with them anymore.

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gomd216 t1_jaf2er5 wrote

I'd walk, unless their interest rate is somehow lower than your outside financing.

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fawningandconning t1_jaf24mf wrote

Just leave. They're not forcing you to buy a car.

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Dfndr612 t1_jaf2ynx wrote

Most dealers want to finance the vehicle they sell you, as they make a nice commission from the bank.

Never tell the dealer upfront, that you will be financing it elsewhere, or that you are paying in cash, as they will charge you a higher price to compensate.

About the "no prepayment penalty" that’s following the law. But, car loans like mortgages are so heavily weighted towards paying off mostly interest in the beginning, before significantly paying down the principal.

If you take the dealership’s financing, and refinance it a month later, you will be paying dearly….which is why they told you to do it.

As others here have said, find another dealer!

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nkyguy1988 t1_jaf1rl7 wrote

IANAL but I'm almost certain beyond a doubt that they legally can't force you to use any financing from them. What if you wanted to pay cash?

They can require their financing for promo rates, etc, but a blanket no outside financing is questionable at best.

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theoriginalharbinger t1_jaf4lsq wrote

> 'm almost certain beyond a doubt that they legally can't force you to use any financing from them

And what would lead you to believe this?

Dealers can definitely mandate that they use their own financing, as long as the financing does not fall afoul of any kind of discrimination (IE, credit has to be extended in a way that is not discriminatory) or usury laws in the state and municipality in which they're operating.

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Pretty_Swordfish t1_jaf1eng wrote

Not the best. If you aren't willing to walk though, then you are stuck. If you can prepay the entire loan at any time and no cost, you can refinance later if you find a better rate.

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fluffy_bunny22 t1_jaf27s3 wrote

Refinancing is usually not as good of a rate as buying it brand new.

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Pretty_Swordfish t1_jaf4dnu wrote

True, but some banks consider the first 30 or 60 days to be effectively new.

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