A lot of time (all the time?) there is no prepayment penalty...well, for the buyer.
If you pay off the loan in the first 3-6 months (from what I've seen, that duration likely varies) the finance company does a "chargeback" which penalizes the dealership. If you were happy with the dealership experience, you wouldn't want to do that to them. More info/commentary here: https://www.reddit.com/r/askcarsales/comments/eupo0m/financing_chargebacks/
hello Sajeev, i am still confused what the best sources are to get the invoice price. Where or how do you get invoice price on a vehicle?
And when you mean "buy cars at or near invoice" is that drive out price or pre taxes/title etc?
Invoice price is often found on Edmunds.com after a fair bit of clicking around. I haven't checked in a few years to see if they still provide it without forcing you to give more information out to a local dealer to complete a sale.
I do not mean the drive out price, that was only the price of the vehicle alone. I find it hard to believe that anyone, even an employee at a high volume dealership with a lot of holdback, can get a "drive out" price for a car that's anywhere near invoice price in our current economy.
Kinda wish I could have gone over all these terms in the story, but it was long enough as-is.
Leasing used to be:
1. Significantly cheaper due to inflated residual values when the lease ended, which doesn't seem to be a thing any more. Basically OEMs were robbing Peter to pay Paul, essentially taking some loss when the vehicle goes to auction after the lease.
2. Better for a company's cash flow because of possible tax benefits (long story, and I am not an accountant qualified to dig into it) and the insanely low "money factor" when financing a lease.
I am not sure if either benefit exists today, but poking around a Luxury OEM's website for a few minutes might shed some light on this.
My 12 year old daily, that I'm delighted with, has some 212k on it and as long as I can keep rust at bay it'll be cheaper to just keep fixing/replacing what breaks. Added benefit is not buying into more tech than I already have.
Reviews only take you so far, especially with bigger dealerships. Going by reviews alone isn't a good idea, as the person that earned the 5-star review could very well be gone, as employee turnover in Automotive Retail is stunningly high. This is less so at smaller dealerships, as the owner/General Manager might assist in all deals and ensure they beat everyone's price on the vehicle, the financing, the trade, etc.
Going by reviews alone might set you up for a huge disappointment when you walk into the dealership, it's best to also do the 8 steps listed in the article.