Topic: Newbie car buying a car question

[mruniverse]

Hi, first time car buyer here with a newbie question:  When I made a counter-offer, the salesman asked me to sign a paper stating my offer and requested my credit card info, I flat out refused stating I will not sign anything or give out any financial info until we have a deal then he said that is not how things are done.  Is this true, is this really how the process works?  Do I need to sign and submit my credit card number when making an offer or is this a shady sales tactic?

(Message edited by mr.universe on June 22, 2005)

(Message edited by mruniverse on June 22, 2005)

[84im]

I'm with you.  There is NO WAY   I'd give a salesperson my credit card number.....I'd walk/drive to the next dealership.  Be VERY particular who you give your credit card number to.

[mofomikes]

they couldnt use that to hold you to the deal could they?  isnt that a tactic to hold you to your stated price so you wont renegociate the price if they accept?

[Sterling]

Of course that's why do that. But then why in the world would anyone make a counter offer that they didn't intend to honour?

That would be just as "shady" as anything the salesman might do.

(Message edited by Sterling on June 22, 2005)

[mruniverse]

I not suggesting that I'll renege on an offer (it was a low ball offer to counter the msrp they threw at me) but why couldn't we just settle on a price first before they requested any type of written commitment and financial info? But this is normal practice?

[mofomikes]

so this tactic is 'shady' only relative to where Mruniverse is in his buying cycle.  

if hes about set on purchasing the car, then this whole thing would be fine.  

if hes still shopping around then this tatic is a bit greasy.  

correct?

but then counter offers are made when your ready to buy, are they not?

[mofomikes]

mruniverse, i suspect that this tatic is used so that you wont low ball them.

[tenpenny]

Always read anything before you sign it.  Then you'll know what you are saying.  If you do sign a written offer, it probably has to be accompanied by money to be considered a real offer, hence the request for your credit card.  Same with real estate, an offer to purchase is accompanied by a deposit in order to be considered a legal contract.  Once you've made the offer in writing, the seller can hold you to that, or you forfeit your deposit.

That said, if a car salesman asked me for a credit card, I'd ask him for one of his.

Let's face it:  you're either making a serious offer, or not.  Only you know which.  If you aren't serious, you're wasting everyone's time, and your encouraging salespeople to use these tactics to weed out the serious offers.

[toolatecrew]

It’s a tactic and a shady one.  

They always ask you to sign or initial offers. It’s not a legally binding document though. It’s a way of getting COMMITMENT. If you've taken as many sales courses as some of us have you'll find every industry preaches this. Commitment. By signing you feel committed to the vehicle and the price. You are not actually committed to taking that car until you sign the SALES contract and take delivery. I mean think about it. You sign and then they try to give you a car with a smashed fender. Do you have to take that car because you signed? NOPE not until you take delivery and possession.  

When I sold cars we used to "write deals" in all kinds of crazy ways to get commitment. The person signed below agrees to purchase the car pending wife's approval and son's skis fitting in the trunk. (I'm serious well not about the skis but about wife's approval).  

It’s true it is also to keep you from cross shopping to other dealers. I don't blame dealers for doing that but the tactic itself is about control and who ever has control wins so here are a few responses you can use if you DON'T want to just walk out:  

1. I'll be happy to sign a SALES contract to purchase this vehicle at the price I just gave you. Bring me back a sales contract with $XXXXX written on it and I'll sign it and give a deposit. Anything else is just negotiating.  
2. (I love using this one) Mr Salesperson do YOU have the authority to make a decision on the price of this car? No matter what they try to they can't say yes (except in rare cases). When you get them to NO its easy. "OK I am the decision maker on what I will pay for this car. I need to talk directly to the decision maker for what you will sell me the car for. If we are going to negotiate, if you want me to say YES I need to speak to the person who can say YES to me.  
3. (I would not do this but its about what YOU want to do) Write a note on the offer and spell everything out in detail.  

I agree to purchase vin number XXXXXX for XXXXXX including tax license and ALL applicable fees. This offer is good for (write a time say 5 minutes from when you signed) after which it is null and void. Signed your name  

I agree to sell vin number XXXXXX for XXXXXX this includes freight PDI taxes and ALL other fees.  
Signed (Manager)  

Say here you go all signed. Take it to your manager get him to sign the bottom and we will start the paperwork. If you bring it back with any numbers changed or its not signed I'm done.  

DO NOT DO NOT give them your credit card number, your card or a deposit. It is a control technique designed to hold you in the dealership and to make you feel committed as though you have "bought" the car.  

Deposits are to hold an AGREED upon price. You don't give a deposit to a hotel or a rental car company to hold a room or a car without having a price agreed upon do you?  

The house sales thing is a crock. The deposit is there to "take the house off the market" while negotiations proceed. Its held in trust you don't give a check to the seller for them to hold while you negotiate. There is not third party holding the check in this case.  

We used to use this all the time when I sold cars. Show the manager a check and he knows you are serious. Well I've already given you a way to avoid that. You should be dealing with the DECSION MAKER. If YOU Mr. car dealer are serious about SELLING me a car then you will have the manager (decision maker) come out and see how serious I am. I'll gladly give you a deposit check to hold the vehicle upon my signing a SALES contract.  

Thousands of vehicles are sold every day with no deposit on the offer. If you choose to do it its your CHOICE they WILL sell the car without it. I've never heard a dealer say nope we won't take your money because a deposit didn't accompany the offer. If you said I'll pay MSRP for this car do you think you need to give a deposit to get your offer of MSRP accepted...be fun to try?  

Its up to you I can only say what I would do or what has worked for me.  

I won't sign anything "open to change or negotiation" I only sign clearly spelled out binding contracts and I'd expect the dealer to do the same.  
I only give deposits once I've agreed to a price or to be held in trust if something is taken off the market (for a house).  
I prefer to maintain control of the transaction. Its MY MONEY.  

Good luck follow your instincts. If it makes you feel uncomfortable or feels wrong it probably is.

[hondasalesguy]

Good one TenPenny. People don't dick around when they are buying houses, but they sure do when they are buying cars. Some are even brilliant enough to leave a deposit and sign a bill of sale at one dealership, and then continue shopping!! Then they wonder why the 1st dealership is pissy about giving them their deposit back...

Negotiating in good faith is unfortunately not done very often by the customer. When the dealership says they will do something, they are bound to back it up or else people think they are sleazy or crooked. But customers routinely lie about trade value (what they have been offered)and or condition of trade (such as previous accidents or bodywork), committment to purchase TODAY, (they say if you give them a price they like they will do the deal, then they say thanks I'll have to think about it), and deals on comparable cars they have supposedly been offered elsewhere.  

But these tactics are called "smart negotiating" if done by a customer, and "crooked" if done by a dealer...

Bit of a double standard there...

[mofomikes]

sounds good tenpenny. i'll keep that in mind when im looking into completing a purchase.

What if a sale has been agreed upon verbally, would you go straight to the paperwork (sales contract)? The sales contract should have in detail what vehicle is being purchased, with all options specified. correct?

[johngenx]

People don't dick around when they are buying houses,

I know some real-estate sales persons that would disagree with you.  They see people making offers on houses WAY out of their price range and then the financing never comes through.  Spend some time with an experienced agent and they'll have lots of tales of woe that sound exactly like the tales of woe from cars sales.

Me, I never give a deposit until a deal is struck.    We're still negotiating, and the "credit card with offer" tactic is simply to get you to not walk out the door.  It's to their advantage, so I don't do it.  I do things that are to my advantage, not someone elses.

When I bought my house, my offer came with a $1 deposit.  Sounds terrible!  People will freak out.  But, I had two other houses I was interested in and didn't want to get nailed down by having my deposit tied up.  I made it clear that if we struck a deal, I would give a substantial deposit at that point, to give peace of mind for the seller, as there is always a time gap until closing.

committment to purchase TODAY

I never have to lie about that.  I don't impulse shop a pair of $600 mountain boots, and I sure don't impulse shop a $20,000 or substantially more automobile purchase.  I always say "no" to the "will you buy it today" question.  It's a lot of money and I don't spend that kind of cash lightly.  You might be in a rush to sell the car, but I'm not in a rush to buy it.  In fact, I have never bought a car from someone that used that statement.  It kills the deal for me.  You're too desperate and I don't like desperation.

[Snowman]

Good advise Toolatecrew. I rarely encounter a salesperson that does not use some form of pressure tactic. Even when I have explained myself very carefully as to all the research I have performed and the knowledge of the automobile I want to purchase. They still bull B.S. on me…..I have walked out and drove to another dealership at the 11th hour due to the usual crap dealerships pull at the last minute. I have never given my credit card for a deposit.

[mruniverse]

Thanks for the great advice everyone.

Note that I'm not suggesting that all car salesmen practice shady tactics, I'm just trying to find out what the process is with regards to offers, deposits, and submitting credit card info.  This is the first time I'm buying a car by myself and I may be too cautious here, and let's be honest, car salesmen don't have the greatest reputations.

I have no problem leaving a deposit with my credit card and I intend to stand by all offers I make but according to a majority here, I should not sign anything nor give them my credit card number until a sales contract is written and signed by both parties. Is my understanding correct here?

[Sterling]

Your understanding is correct - if you are a consumer tough guy like the regular posters here. If you are just a regular consumer you may want to soften the approach. Following the tough guy approach will lead to a miserable experience if that isn't your nature.

In my experience the people that get into trouble are the ones that let their greed lead them to the worst dealerships that promise the moon and can't deliver. If you feel uncomfortable about the place or people you are dealing with then you should leave well before it is time to negotiate.

[toolatecrew]

Its not being a tough guy to refuse to give someone your credit card number in order to have your offer considered.  

Yes some of the other tactics discussed are tough and not everyone should use it but thousands of cars are negotiated and sold every day without a credit card number along with an OFFER. Its not required. There is a big difference between being a tough guy and simply not letting yourself be hearded like a sheep.  


I repeat follow your instincts. You obviously felt uncomfortable enough with the whole sign this give me your credit card thing to come into this forum and ask "is this normal it doesn't seem right".  

The most miserable expereince you can have is to go through this process feeling like you are geeting screwed over. A car is a big purchase. You should feel comfortable with what you are doing. If you want to make an offer without a credit card do it. If they won't accept it there is a good chance someone else will.  

I mean if MSRP is 20,000 and you say I'll offer 19,999 they won't accept with out a credit card? Some might say oh but that's only $1 but it doesn't matter negotiating is negotiating you either accept offers ANY offers withut a credit card or you never do it its black and white.

OT a little but reminds me of a joke :
A guy from a really big island off the coast of NS is on a plane. He says to the flight attendnat would you go to bed with me for 10 million dollars. she says well tmaybe that's a lot of money. So he says would you go to bed with me for $1. she says "How insulting what do you think i am?"

His response "we have already determined what you are my dear. Now we are just haggling over the price".  

I agree that some consumes are untruthful and it is reasonable to try to ensure people stick to their deals but Hondasalesguy can you hinsetly say you have never seen a car sold without a siugned written offer and a credit car accomanying the offer in the NEGOTIATION stage?

[toolatecrew]

I find the whole house/car purchase comparison very weak.

So many many differences.  

The rules for relaesate are quite clear. Regulations are in place to protect both buyers and sellers. Agents must be lisenced and understand the rules and regs. Car sales (at least in Nova Scotia) have very few regulations and sles people are not liscenced.  

Offers on a home are essentialy written by the buyer and given to the seller where they can say no or yes. its decsion maker to desion maker.  

There a re multiple checks and balances in place to get out of the deal if everyting is not EXACTLY as spelled out. If it doesn't pass inspection pending financing etc.  

Anyone ever walk into a house you want to buy and have an agent say "what do we have to do to get you to move into this house TODAY?  

The process is a nerve wracking one for sure but its much more formalized and rigid than the car buying process. Not to mention the fact that you can by an IDENTICAL car from dealer a vs dealer b. You can NEVER buy an identical house. Even if the only difference is that its across the street you cannot but the house at 123 main starret Halifax anywhere else.  

Just had to throw that in there as I see the "would you do this when buying a house thing "thrown out there as if the two transactions are very similar simply becuse both have negotations for high priced items

[tenpenny]

I apologize for having started the reference to a house sale.  Must be because I drive a Subaru.  I'm obviously unqualified to speak about car buying or real estate.  

I defer to your obvious vast and overwhelming understanding.

We are unworthy of your presence.

[Snowman]

I never go into a dealshp cocky, aggressive, or acting tough. I go in well prepared with all the information I have gathered over the past for months and in a friendly and cordial manner. Perhaps this is a trigger for salespeople to become annoying and out comes the pressure tactics. Then I become agitated and off come the sheep’s clothing.

[Sterling]

Gawd, at least the "how come I don't have to negotiate on a loaf of bread" argument hasn't been made yet.