Bought at Criswell and used their financing - no pay-off penalty, but risk of losing 2% discount post-sale? How?

[Kyanche]

I'm not usually a fan of defending a dealer, but if they're offering 2% off for holding a loan for 6 months and enough people break that agreement, they'll stop offering the 2% discount. That's kinda mean. That discount is anywhere from $600-1000 right?

If you did a 60 month loan then depending on how good the loan terms were, that's probably about half of your discount. So if you were going to pay cash you're paying ~$3-500 in interest instead. Hmmm then it's only a 1% discount huh.

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[Dkretden]

I'm not usually a fan of defending a dealer, but if they're offering 2% off for holding a loan for 6 months and enough people break that agreement, they'll stop offering the 2% discount. That's kinda mean. That discount is anywhere from $600-1000 right?

i’m sorry but i don’t agree with you.

if they wish to enforce a term of a loan that they themselves originate, they need to write the term INTO the loan. It’s called a pre-payment penalty. If they can’t do pre-payment penalties in their state then they are just being disingenuous with the customer.

the Customer will finance the loan and live by the TERMS OF THE LOAN. If the terms of the loan DO NOT contain pre-payment penalties, well, the dealer will just have to find another bait and switch gimmick to get people to buy. It’s all a game. They play the game and we play the game. If a huge Business like a dealer wants to play a game with UNWRITTEN rules, I’ll play and abide by the written rules.

 

[srs148]

I'm not usually a fan of defending a dealer, but if they're offering 2% off for holding a loan for 6 months and enough people break that agreement, they'll stop offering the 2% discount. That's kinda mean. That discount is anywhere from $600-1000 right?

If you did a 60 month loan then depending on how good the loan terms were, that's probably about half of your discount. So if you were going to pay cash you're paying ~$3-500 in interest instead. Hmmm then it's only a 1% discount huh.

A few things at play that ease any guilt I may have had of holding the loan until it seasons enough for Criswell to receive their kickback -
1/ they offered 8% off invoice until several months back and lowered it to 7%
2/ they raised their fee from ~$300 to $500 as of July 1 of this year
3/ I noticed another fee slid in there of $375 I believe for 'documentation' but it's just a fluff fee
4/ Koons is offering 7.5% or 8% (I forget which) without the need to use lender financing. Criswell and Koons are in the same league
5/ Criswell is making their money on the sale regardless of the deep discounting because they move massive volumes so get huge bonuses / discounts from FCA on the purchases of their vehicles, so their actual cost is far below the listed invoice price we all see
6/ Dealers make their big money on trades / used sales and on their service department

 

[dgoodhue]

Just out of curiosity what is your interest rate?

 

[78cj7-18lj]

First - a word about my vehicle delivery experience - I took delivery of my JLUR yesterday afternoon at Criswell. I have to say that they are awesome and I highly recommend them. My sales rep Leon was probably the most organized and knowledgeable about Jeeps guy I've ever met. And it's quick and efficient without being pushy or rude whatsoever. Even called last night to make sure I made it home safe and ask if I had any questions now that I'd driven the JL a few hours. He's awesome and I plan to use him again to replace my 2014 GC Summit when the Grand Cherokee (finally) get's it's long-overdue redesign.

About the financing - in the state of MD, banks aren't allowed to levy an early pay-off penalty, so my lender won't charge me if I refi the loan. However, my finance guy said I have to wait 6-months before I refi the loan in order to retain my 2% discount for having used their financing. But there's nothing in my sale documentation that calls out any kind of 2% clawback should I refi before six months time. And besides that, how would they do it? They can't charge my credit card for something I haven't signed off agreeing to.

So how would the dealership pull back the 2% discount from the total sale price if I refi'd the loan next week?

it's hold back $ Look at it as a bonus for the dealer from FCA for volume and finance with house bank.

 

[srs148]

Just out of curiosity what is your interest rate?

4.49% - same rate for 48 or 60 months. Navyfed is running 2.19% on the same loan terms. My credit qualifies me for top-tier rates, so it's not a credit worthiness issue.

 

[HEX87]

I looked over my contract and didn't see anything. And the finance guy himself said that MD doesn't allow early payoff penalties, so we know nothing would come from the lenders. I'll likely move forward as soon as I receive the first statement / welcome from US Bank and will report back here.

I'm doing Navyfed as well and, as an FYI, called and asked them if I would still qualify for a New Car loan rate if I wait six months to turn it over and they said that I would still qualify as long as the vehicle is under 7500 miles.

Yea no early payoff penalties too they told me. I don't know if I should wait also 6 months if i dont have too at what ever crazy Chrysler interests rate (probably in the north of 4%) for their jeep when i know I can get 2% with navy Federal for six years.

 

[jwhite77]

4.49% - same rate for 48 or 60 months. Navyfed is running 2.19% on the same loan terms. My credit qualifies me for top-tier rates, so it's not a credit worthiness issue.

Depending on how much you are financing you probably aren’t losing much between 4.5 and 2 percent for just 6 months. I would hate for the 2% off going away in the future. They are probably more counting on people forgetting to transfer their loans.

Does anyone know if the 36mo 0% is being given out?

 

[srs148]

Yea no early payoff penalties too they told me. I don't know if I should wait also 6 months if i dont have too at what ever crazy Chrysler interests rate (probably in the north of 4%) for their jeep when i know I can get 2% with navy Federal for six years.

That's the thing - the Chrysler rate is probably cheapest of any rates they have available, so they don't use Chrysler. They use lenders who provide a kickback like US Bank, Chase, Wells, Capital One. I got US Bank, but I think someone else here on the forums got Chase recently. My rate was 4.49% with excellent credit.

 

[jwhite77]

That's the thing - the Chrysler rate is probably cheapest of any rates they have available, so they don't use Chrysler. They use lenders who provide a kickback like US Bank, Chase, Wells, Capital One. I got US Bank, but I think someone else here on the forums got Chase recently. My rate was 4.49% with excellent credit.

Did you try requesting it?

 

[srs148]

Did you try requesting it?

Yes, I asked multiple times for a better rate or different lender and was stonewalled. I was told US Bank was the most competitive of any of the lenders they had relationships with (a lie), so I figured it wasn't worth continuing to waste my breath for a .5% difference in rate because it was never going to be a great rate - I expected that going in.

 

[Kyanche]

2/ they raised their fee from ~$300 to $500 as of July 1 of this year
3/ I noticed another fee slid in there of $375 I believe for 'documentation' but it's just a fluff fee

I hate that kinda stuff. So it's "8% off invoice" but really more like maybe 5-6% when you count the financing and the other fees. The only fee I was charged was like $90.

Besides, I guess if things were the other way around, they wouldn't hesitate to 'forget' about a detail that wasn't on paper. And if you refinanced it quick enough it won't be as hard on your credit as if you waited 6 months, I bet.

 

[foxredlab]

I don’t see the problem. If they offered you an extra 2% invoice to finance through them and to not refinance for 6 months, then keep your word and wait 6 months. If they made no mention of waiting 6 months to refinance, then refinance.

 

[bullfrog3459]

Yes, I asked multiple times for a better rate or different lender and was stonewalled. I was told US Bank was the most competitive of any of the lenders they had relationships with (a lie), so I figured it wasn't worth continuing to waste my breath for a .5% difference in rate because it was never going to be a great rate - I expected that going in.

My recent purchase asked me if I wanted to use FCA Financing, Bringing my Own, or if I wanted to find someone. We landed on Ally at 3.79% and we were out the door. I didn't get 7-8% off of invoice, but we did settle on 4% where I bought from.

Maybe word doesn't mean much, and a "gentlemans" agreement is just that, but I agree to some posts that if you agreed on 6 months, then I would keep it six months and then refinance if I needed. As these loans are simple interest, the amount of interest over the term generally is pretty small; sometimes refinancing doesn't make sense if you look at the cost involved or possible refinance fees to the interest saved over the term of the loan.

 

[srs148]

I don’t see the problem. If they offered you an extra 2% invoice to finance through them and to not refinance for 6 months, then keep your word and wait 6 months. If they made no mention of waiting 6 months to refinance, then refinance.

The ‘don’t refi for 6-months’ wasn’t stipulated anywhere, nor disclosed upfront. What was literally (and I mean literally) whispered by the finance manager with a wink as I signed the paperwork was “you can refi after six months, just don’t tell anyone I told you so”. It wasn’t even a, please don’t or thou shall not statement written or otherwise implied.

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