Car dealerships forcing financing.

You better off buying a new car. Used car prices are as much as new cars.

Signed, million man

This is, somewhat surprisingly, illegal in the US.

Car dealers cannot force you to finance the purchase of a new vehicle if you prefer to pay the full price in cash. Dealers may try to persuade someone into financing--because they can make additional 💵💵 through finance charges and potential kickbacks from the lenders--but they cannot legally require anyone to finance the purchase if you want to pay in full with cash.

I'm surprised this is ok in Canada. I would be frustrated too. Like, really frustrated.

I agree, that is seriously screwed up! Years ago I bought a really nice, 4WD SUV from a used car dealer who wanted me to finance through his dealership. I got him to agree to my terms, by offering him a hefty down payment and suggesting I wanted to finance the rest through my credit union. My credit union was impressed with the down payment, the status of my account there, my monthly income and granted the loan immediately. I ended up paying off that loan with a lump sum a year early and made that vehicle last for well over 10 years. I'm glad I don't live in Canada.

I blame the democrats and Biden. They forced all car companies to produce Electric cars only which are bad for the environment because Lithium batteries cannot be recycled. Not to mention you can't go on long trips with them very well cause of how long it takes to charge them. And by making them produce nothing but that they have made it so poorer people can't buy cars. What a bunch of unthinking jerks!

It’s especially shady if they got you in there by advertising a certain price and then failed to mention they’d reject cash offers. An offeror should have the right to set the terms of the deal he wants but its false advertising for a dealership to quote a price without including the true amount with forced financing.

If you love the car and the dealership really wants the sale but they need that $1200 commission from the lender with whom you’re forced to finance, it seems you have the bargaining power to negotiate a price discount that’s the equivalent to the interest penalty you’ll be paying.

Then, you can console yourself that your payments over the years will save you money. Due to the effects of inflation, the installment payments over time will have lower value than you would have originally spent with a lump sum cash payment in 2024.

Keep the purchase price of the car separate from the financing. They can play with the number of payments and payment amounts and confuse the actual amount you are paying for the vehicle. Only get a “simple interest” loan and learn how a loan amortization calculation works. You can do this in MS Excel or any spreadsheet program or financial calculator. Avoid loans that use methods like the “Rule of 78s” or other schemes to calculate interest. Stick with “simple interest” loans. Monthly payments include both principal paydown and interest. The payment amount is usually a fixed amount. But the percentage of the payment that goes towards principal paydown vs interest changes over time. At the beginning most of the payment goes to interest. When you do an amortization calculation in a spreadsheet program you can see exactly how much of each payment goes towards principal reduction vs interest.

the last new car i bought was from a dealership and i paid cash. they had no problem taking the money.

That's wild. Seems like a good way to drive away customers. I bought a used car from a dealership about four years ago and ended up paying it off early. I hope this doesn't become the standard.