just got back from acura

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Oct 19, 2003

#31

4Saris

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Quote:

Originally posted by Civicster
DEALER ALWAYS make some money off u wether itz the car price, trade in or finance. they always make profit of the finance so dont go thinking dealer wont make money... even if car is sold at invoice. they still make profit

Yep, they can sell it below invoice and make money. They make it off of holdback and financing. Holdback is a % of MSRP that they get from the manufacturer, usually 2-5%. So if you buy a $20,000 car, they can make $1000 selling it right at invoice. Also, if you have bad credit, they make what is called finance reserve. The bank approves you at % and they have the option to write it up, and they get 70% of the extra finance charge. That can be a grip of money depending on how much the car costs.
Example:

$20,000 car at 60 mos, approved at 5% and they write you at 8%.

The difference in Finance charge is $1686.19 and 70% of that is $1180.

So if they have sold the car at invoice, they still make $2180 with the holdback and finance reserve. Always ask to see the "Callback" from the bank.