Quote:
Originally Posted by speede5
I think at the end of the day you pay one way or the other and for a lot f people new is just that much more attractive.
Question, is cash purchase going to save you anything? I've heard over and over that your best price will be with dealer financing due to commissions they receive. If cash is in hand better to take the financing and pay it out the next day.
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New Vehicle: Cash may be cheaper depending what the current incentives are as they vary from month to month and vehicle to vehicle. Cash, finance rates and lease rates can be different for each vehicle, each trim level of that vehicle, and year of the vehicle (right now most dealers are still sitting on 2019's AND 2020's with there still being a few 2018's kicking around). Of course factors such as time of year, availability/ inventory, market strength, marketing strategies etc... all play a part in the incentives being set by the manufacturer.
The "X" % of MSRP are typically cash prices, which can still be financed at a bank rate however. "Employee pricing" is again not typically stackable (car term for combinging incentives) with 0% financing. Right now we have a $2400 savings on a cash purchase of a 2020 GMC Sierra, with finance rates from .99%- 1.99% depending on term. so do the math on that, take $60,000 out of your TFSA to save $3000 in interest as well as $2400 ourchase price, so overall $5400 less to pay cash. Thats just one example. Other then that GM currently has no other relevant cash incentives on a 2020 model year vehicle, so it is differently on a case by case basis. Back in September or maybe it was August, it was actually cheaper to lease a Buick Encore for a couple of months then pay it off as the lease incentive was $1000 more then the cash incentive, to encourage leasing. It is really a case by case basis.
Used Vehicle: No difference in price if paying cash or financing, the dealers do make more money when customers finance as the banks pay a reserve.
Overall dealers prefer financing or outright purchases for a couple of reasons. It is always easier to sell to someone already making payments, they banks pay a reserve when customers finance, people making payments are more likely to buy the "extras" such as warranty, insurances etc...