Help with Used Dealer Tricks

[shaginwagon]

2019. I don't think there's any warranty left as RAM does 3 years I think. I checked Carfax report and 1 previous owner and it was leased. Extended warranty they are mixing in with the final price to be vague but calculated to be somewhere between 3000-5000 for all these fake protection things and oil changes.

Yeah, sounds like your close to the end of the basic, but it still should have a 5year/100,000km on the power-train. That extended warranty price is high, finance guy must be just trying to make his bonus off you. I would walk from that and look for or order a new one. Best of luck, the used truck market is crazy now with low inventory and high prices.

 

[JoeCo]

This is why I bought new, prices on used trucks were already out of hand in March when I ordered. I have to wait for the truck but will be paying the same if not less for my new ‘21 Sport with the options listed below. There were still some great deals (21% off MSRP) to be had on new trucks in March, lots has changed since then.

Likewise, first time buying new (and ordering) but it made absolute zero sense to buy used.

 

[Johnny_H]

LOL those payments are what I’m paying for my 21 limited.

There’s still thousands of new trucks on lots across the country. Just buy a new truck with a fantastic finance rate.

You’re spending roughly $3k a year on financing costs. Any guy in a new truck this year is spending $0.


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[00fil00]

LOL those payments are what I’m paying for my 21 limited.

There’s still thousands of new trucks on lots across the country. Just buy a new truck with a fantastic finance rate.

You’re spending roughly $3k a year on financing costs. Any guy in a new truck this year is spending $0.


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Yes but you are just looking at the regular payments which is what they want you to look at; that's the sucker trick. You guys will end up paying $77k total, whereas this truck is $55k if you pay it off fast. It's all about the total not about the payments.

 

[NorthStar]

LOL those payments are what I’m paying for my 21 limited.

There’s still thousands of new trucks on lots across the country. Just buy a new truck with a fantastic finance rate.

You’re spending roughly $3k a year on financing costs. Any guy in a new truck this year is spending $0.


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What? I’ve never paid $3K a year for finance costs. To pay that much would equate to 8% for 72 months on $70,000! Who in the world agrees to terms like that?

 

[Reverse]

My advice would be:

- consider what having to get a 7-year loan means - to me it would mean I can't really afford this truck
- if you want to buy anyway, arrive at dealer with alternate financing as a plan B. In the US, that would be your bank or a Credit Union - Canada I don't know
- do not negotiate based on monthly payment, but on cost of vehicle and warranty. From your post I can't tell how much the dealer wants for the warranty.
- for the warranty, also arrive with plan B in your back pocket. Find an online warranty company and see what the going rates are in Canada. As a reference, on my Limited, my dealer wanted $2000 more than what I had priced out online. They make serious money on the warranty if you just pay what they charge because it's rolled into the financing.
- finally - you may have your heart set on this truck, especially in today's crazy market. Ignore that as much as you can and be prepared to just walk away.

 

[Johnny_H]

What? I’ve never paid $3K a year for finance costs. To pay that much would equate to 8% for 72 months on $70,000! Who in the world agrees to terms like that?

Guy is financing 50k at 6%. Do the math. Of course this is just the first year and is decreasing over time, but that’s $10k total interest over 72 months. OP’s second option was 84 months at 8%.....so he might agree to terms like that.

With guys making money on trucks these days, overpaying on a used one and then donating $10k to the bank doesn’t seem too savvy. My apologies for giving approximate numbers.


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[cdn.tbird]

My advice would be:

- consider what having to get a 7-year loan means - to me it would mean I can't really afford this truck
- if you want to buy anyway, arrive at dealer with alternate financing as a plan B. In the US, that would be your bank or a Credit Union - Canada I don't know
- do not negotiate based on monthly payment, but on cost of vehicle and warranty. From your post I can't tell how much the dealer wants for the warranty.
- for the warranty, also arrive with plan B in your back pocket. Find an online warranty company and see what the going rates are in Canada. As a reference, on my Limited, my dealer wanted $2000 more than what I had priced out online. They make serious money on the warranty if you just pay what they charge because it's rolled into the financing.
- finally - you may have your heart set on this truck, especially in today's crazy market. Ignore that as much as you can and be prepared to just walk away.

Not sure what the OP's credit rating is but that may be why they're looking at used instead of new. From the bit of information the OP shared, I would be walking away because it doesn't look like a good deal but right now it is definitely a sellers market. Hopefully the OP can get his deposit back.

Financing in Canada is definitely different than the US. For new car, most of the financing goes through one of the Big 5 banks, even the 0% offers. Unless you have a good credit rating, you can pretty much forget financing through the banks. For used you start to see financing options from 3rd parties but those come with higher rates. What most people may not know is the dealer does get a fee from the bank for sending the loan their way. A good negotiator can use this reduce the price a bit.

As for the warranty, if it's the Mopar warranty it'll be the $0 deductible version. You can negotiate it as well. When I checked what the equivalent warranty to what I purchased would be in the US through Ziegler, what I paid was actually better. Up here dealers won't sell the Mopar extended warranty online so everyone is on their own. Lord knows I tried to get a few to bite but the minute they realized I was only interested in the warranty, they weren't interested anymore. I have a feeling that what the warranty the dealer is including is a 3rd party one though.

OP, if the dealer isn't willing to send you an itemized quote of the deal for you to review, you have good reason to be suspicious. Good luck.

 

[NorthStar]

Guy is financing 50k at 6%. Do the math. Of course this is just the first year and is decreasing over time, but that’s $10k total interest over 72 months. OP’s second option was 84 months at 8%.....so he might agree to terms like that.

With guys making money on trucks these days, overpaying on a used one and then donating $10k to the bank doesn’t seem too savvy. My apologies for giving approximate numbers.


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Perhaps I wasn’t clear in my post as I was agreeing with you and attempting to help the OP understand the ridiculousness of those rates. I used the price of a new truck as an example too so he could understand how nuts this market has become - new or used.

He put more money down, work at improving his credit score or find a better rate from a local bank:credit union before making a large purchase. And if he already has all that, and the dealer offers him anything over 4% then find another dealer. Or go to his own bank like I did and get his own financing (2.69%).

In this market, one is already taking a hit on price and lack of negotiability…don’t let the interest rate nail you too.

 

[Dusty1948]

When I shopped for my now gone 19 Ltd, I made the mistake of allowing my spouse to voice her opinion in front of the salesman about colors. At the time 95% of the truck interiors were black and she only wanted the Ivory interior. Out of the 5 to 6 exterior colors she wanted the tri-tone Ivory.
Out of like 20 trucks on the lot (Limiteds were in good supply back then) there were 2 with the Ivory in and out.

My negotiating strength dropped from "relatively good" to "sucks" all at once.

Morale of the story, don't ever let on that the dealer has "just what you want" or "I've been looking for one of these all over". That's music to a salesman's ears.

I think there were actually two lessons for you there.

Best regards,
Dusty
2019 Ram 1500 Billet Silver Laramie Quad Cab 2WD, 5.7 Hemi, 8HP75, 3.21 axle, 33 gallon fuel tank, factory dual exhaust, 18” wheels. Build date: 03 June 2018. Now at: 051743 miles.