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I bought a brand new Nissan Altima last week, and I've been wondering how I got this deal -
Don't worry. They made money on you. They made a profit on everything they gave you, plus there was no cost to them on any rebates. You also don't know what special incentives where given to them by the Factory for selling that particular car. At the end of the year they also can get up to a 5% payback on that car. Any Dealership is not there to make losses, and they do make money on every car they sell, regardless of how they make it look on paper. Trust me.
Kia and Hyundai offer a 10 year/100K warranty with every car. The extended one you purchased was a KER-CHING in their pocket. If you financed your car you financed the warranty and will be paying "X" percentage for that as well.
The rebate was correctly explained and is not out of the dealer's pocket. The dealership gets a kickback for every new car it sells. Your trade in hurt them not. I wonder what % commission the salesman got.
I wouldn't go by what TC says just as I wouldn't go by KBB. Those figures are ball park at best, no matter what the commercials tell you. No dealership or private seller is going to adhere to any of that. They may go through the motions to appease you but that is it.
Ext warranty is a complete waste of money and pure profit for the dealer. So canceling it is an excellent idea. New cars nowadays go 100k miles w/o a problem and 50k-100k miles is usually the most reliable period for new cars.
Contrary to popular belief dealers dont make much money on new cars, even if they do its chump change compared to the money they make from servicing and used car sales.
Warranties are not 100% profit. they get a commission but warranty underwriter keeps most of it. If you cancel now they will just send a check to your lienholder and it will lower your payoff but not change your payment. Do not cancel it on a knee jerk reaction because of a bunch of internet posts. If you want it you keep it.
Sometimes dealers get bonuses for hitting volume targets. So many dealers will take a very slim deal or even a slight loss on a volume product like a Camcordima bu.
Warranties are not 100% profit. they get a commission but warranty underwriter keeps most of it. If you cancel now they will just send a check to your lienholder and it will lower your payoff but not change your payment. Do not cancel it on a knee jerk reaction because of a bunch of internet posts. If you want it you keep it.
Sometimes dealers get bonuses for hitting volume targets. So many dealers will take a very slim deal or even a slight loss on a volume product like a Camcordima bu.
Wow this guy must sell warranties for a living.
First of all ext warranty is pure profit because majority never use it. Who gets the profit depends on who is offering it of course.
Secondly, canceling the warranty will indeed lower monthly payments since the money borrowed is reduced by nearly $2k.
Dont listen to this warranty salesman and cancel it ASAP.
I bought a brand new Nissan Altima last week, and I've been wondering how I got this deal -
Sale price - $23650 (invoice price is $23914 according to true car)
Rebate - $2000
0% financing with no down payment
And additional fees of:
Document processing - $80
5 year 100,000 mile warranty - $1775 (negotiated down from $2400)
Plus the normal overpriced California taxes & DMV fees
And they gave me a 1000.00 trade in on my Saturn SC1 from 2001, which is worth maybe half of that with the condition it was in.
Just wondering why they would have given me this deal - aside from the fact that I had no problem walking out and not buying a car at all, and was really only intending to do research, I only bought it because I felt like they were practically paying me to buy the car.
Does something like this happen because they have to sell so many cars on a given weekend and my timing was just fantastic?
If the invoice is before rebates, there's $2,000 or thereabouts there. Plus they get hold back which is usually 2-3% on the value of the car which basically pays for the capital costs of having the car sit on the lot. Warranties are a big moneymaker too. Document processing fee. It costs them something but not $80. If the Saturn ran, they'll get more than $1,000 for it at auction.
First of all ext warranty is pure profit because majority never use it. Who gets the profit depends on who is offering it of course.
Secondly, canceling the warranty will indeed lower monthly payments since the money borrowed is reduced by nearly $2k.
Dont listen to this warranty salesman and cancel it ASAP.
A warranty is a hedge, it is insurance. It is not pure profit for the dealer because they are usually selling someone else's product.
your contract is set for a certain payment. And it will not change. Even if you send in 2000 one month they'll still want your originally agreed upon payment next month.
i may not sell warranties but I'm also not ignorant. Dont listen to this uniformed ranting individual who has no idea how business works.
Warranties are re-sold, so they made some money on it but it's not "pure profit." If the warranty isn't a Nissan warranty, then it's probably not a good idea. If it is an official Nissan warranty, then it's just a hedge against something going wrong at 75,000 miles. If nothing does, then you didn't need it. If for some reason the entire transmission blows up, then you will be glad you have it.
If you like the peace of mind then keep it. But Tourian is correct in that it won't change your contractually obligated payment amount, it will just reduce your total overall balance by $1775.
One last thing, if your parents are really looking for "peace of mind" about an automobile warranty, you can look online for them, and find a better warranty with less "fine print" that is cheaper. I did it several years ago on my Corvette. You have to do a couple days of research, look at different automotive forums, BBB complaints, reviews, etc. but if you are going to get one, that is the way to do it. For example mine wanted $3K for the warranty and I got them down to $1800 by haggling. They said I could come back within the first 3 years and as long as I had maintained the service intervals and it hadn't been in a serious accident, I could still get it for that much.
I looked online and was able to get a better warranty that covered a lot more minor stuff, but things that can cost a lot of money like the power windows and mirrors and heated seats, etc. The dealership warranty didn't cover anything but basically the powertrain and things like the air conditioning, exhaust, and heater on the car. I paid only $695 for the same 100,000K and 5 extra years I think.
If you are wondering why I got a warranty it was because I used to track my car in a lot of different automotive events that puts a lot of stress on the car. Nowadays dealerships and aftermarket warranties really look the car over and if you have any aftermarket parts it will pretty much void the warranty. It may have had it in the fine print back then too, but they didn't look nearly as hard.
Paid off, I had over $7K worth of warranty work done that was past the factory warranty. It was a true pain to take off all the aftermarket stuff and return it to stock to have it towed to the dealership, but way worth it.
Anyway, just pointing out that if your parents are insistent, take a look online and see what's out there with good reviews and all. Many dealerships actually work with some of these online dealerships and just profit the difference when they buy the warranty online just before they change ownership.
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they get a commission but warranty underwriter keeps most of it. If you cancel now they will just send a check to your lienholder and it will lower your payoff but not change your payment. Do not cancel it on a knee jerk reaction because of a bunch of internet posts. If you want it you keep it.
