Car Dealers?

[Phat Mack]

An interesting thing happened to me over thirty years ago. I walked into a Toyota dealer and bought a new car for cash. I drove off with the car, but never got a title for it. It seems that the dealer owed money to whoever financed him, and defaulted on the loan. I drove the Toyo into the ground since I could never sell it.

I'm normally a used-car-driving guy, but am getting ready to buy a new car for cash. Can anybody explain how modern floorplanning works, and tell me what I have to do to ensure that I get a title before I fork over the money?

[jmark]

As far as I know when you buy a car from a new car dealer, they only give you temporary registration papers. You get the title in the mail from the DMV in a few weeks along with your registration. But it may depend on what state you're in.

By the way, what's floorplanning?

[Ray Zee]

dealerships are worth too much money nowadays for them to do this. you will get your title. if in doubt finance it then pay it off. sometimes by financing you get an additional rebate. if you are talking real cash you may find the dealer has to report it, so giving a check is better if that is what you meant by cash. congrats, new is nice.


ray zee--- with more cars than zeno

[Lazymeatball]

You could get a financing plan, wait for the title to arrive, then pay it all off the next month. Or you could buy from a respected dealer who isn't likely to default on any loans.

Couldn't you have sued the guy for the title, or had he declared bankruptcy or something. sounds very strange.

[Phat Mack]

Couldn't you have sued the guy for the title, or had he declared bankruptcy

Right, bankrupt. The dealer had to give the area distributor cash before the distributor would send him a shipment of cars. So the dealer borrowed the money from Lender, and gave Lender the titles for collateral. When Dealer sold a car, he was supposed to pay off Lender and receive the title. (At the time, this was called "floorplanning".) But Dealer wasn't paying off, and Lender wasn't releasing the titles.

The normal procedure is to go to the county tax court with the receipt, and they would award title. County tax court opperates like small claims court in that you don't need a lawyer to appear. Normally. I had a receipt for the car. Lender had the title and had also paid for the car, so he threatened to bring in the lawyers. The Dealer was a merchant, and I was a poor consumer, so I knew that I had legal right to the title. But the car, I think, sold for less than $1700, and I didn't want to put any more money into it by way of lawyer's fees.

At the time, a lot of Japanese cars were sold by guys who were basically used-car-lot proprietors. Of course, Ray is right; they have all become big businesses, so there is little chance of this happening now.

[HDPM]

Yeah, you get documents and an application for certificate of title. When you go to the DMV they do the paperwork and send title later. Under all the statutes I am not very familiar with, the state will issue title. I would think the states have a large degree of uniformity on this. One difference is that in liberal states it costs a ton of money. Here I think I paid like $78 or something for registration and title on a brand new car. /images/graemlins/tongue.gif

[Leo99]

They make more money if you finance through them so they don't like cash. I bought two new cars last year. My wife and mother both totaled their cars. Two Toyotas. Do your homework, kick some tires and then KNOW your prices. Go in, tell them what you want and how much you're gonna pay. Don't let them give the first price. That will start your negotiations up too high unless you know the dealer is cool. On my mom's car, they asked 17500. We countered with 15000. If they started at 16000 off the bat we would have bought at 15500 but they irritated us with such a highball number that we wouldn't budge from 15000. We couldnt make a deal with them and got tossed from another dealer but got the car for 15400 at another dealer where we just walked in and said we want this car for 15400. They said ok and off we went.

[BusterStacks]

For the love of god, do NOT buy a brand new car. I've spent my entire life in the car business and let me tell you, it is their job to screw you. No matter the deal, you are NOT getting a good deal. Are you really set on this idea? Especially the cash part...

[Phat Mack]

Are you really set on this idea?

Not really. I'm with you on this: I don't like buying new cars--I think it's a bad play. I'm busy with a lot of things right now, and will be for a few months. I need a car for a gift that will be reliable. I was thinking of something like a Camry.

If you know a way to buy a decent used car in a minimum amount of time, I'm listening.

[jmark]

If you use your costco card you can usually get the car for a little bit over invoice ($200-$500). Just check online and find out if there are any dealer incentives that you can subtract from the price.

[Slacker13]

Why would you pay off a car in cash? There are too many great financing deals out there to do this. Finance the car and use what you would have spent in cash by placing it into a mutual fund for the life of the car loan, if done correctly you will come out ahead. Just my opinion