Why dealers seek to finance a car on credit, even if you can pay in cash

Buying a new car may seem easy. However, some dealers will want to use your ignorance of the process to force you to sign a financing agreement, even if you can pay for the car in cash.

You have probably ever approached a car dealer with the intention of buying a car, and while most purchases are financed, there are some rich people who are able to pay cash or cash for a new car.

However, during this cash payment process, the vast majority of buyers are faced with a dealer request for a loan with a cash offer and brands you can order from, but why it should be "need to apply for cash", here we tell you .

Tom McParland, a Jalopink car buyer, says he worked with a local Kia dealer for Telluride, and they insisted he apply for a loan as part of the process, even though the payment had to be in cash. Dealer managers have indicated that this process is "store policy", which makes no sense if the car is pre-paid, leading to another question.

 Why would dealers have this procedure as a policy?

The short answer is that there is no reason for the dealer to insist on credit if you are buying with cash. This is especially true if you are using a bank transfer to pay for a car, as this removes any excuse for having "clean funds" or whatever the dealer wants to say.

Hundreds of car buyers have made cash payments, and in almost all cases, the store accepts payment and that's it. On the few occasions when a seller does request a loan application, almost every time it comes from a store known for its shady business practices. They usually want the loan to be approved as "support" so they can send it to the finance department.

There are exceptions when a loan application is required

In some cases, for ordered vehicles, a loan request is a prerequisite to ensure distribution of the order. It's not best business practice for dealerships, but if that's what it takes to get a car in high demand, there's nothing wrong with making an app. This will greatly affect your credit profile, but if you have a high score it won't have much of an impact. Upon the arrival of the car, all you need to do is refuse to sign any financial agreements and proceed to pay in cash.

Which brands match these requests?

Sometimes you can get lucky and find exactly the car you need in the parking lot. Other times, the dealer pulls strings to bring in that perfect car from another dealer. However, usually you buy a navigation package that you don't really need, or maybe you choose your second favorite color because you need a car ASAP. However, you can also book exactly the car you want if you're willing to wait, and that's for the best.

The ability to order a car is dictated by the automaker, not the dealer. Just because a dealer says they can take your car away from you doesn't mean they can. However, a good dealer will be able to honestly and accurately tell you if an order is possible and what is the estimated order time.

Generally speaking, all European brands will offer ordered cars. The same generally applies to the big three domestic automakers. When it comes to Asian brands such as Toyota, Honda, Nissan and Hyundai, the situation is rather mixed. Some brands make "appointment requests" that aren't exactly orders, while others, like Subaru, may place an order for exactly what you want.

The caveat when ordering is that you can usually only order a vehicle that can be customized on the automaker's website. For example, you cannot order a car with a manual transmission if it is not available for that model.

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