Car Financing and Insurance

It’s been a bit of a long negotiating process at the car dealership, but you’ve finally settled on a car and a price for that car… so all is good and your done… right?

WRONG!

That is if you are about to be accompanied in to meet the car dealer’s F&I (finance & insurance) manager to sign everything and wrap it up.

Just a mere formality?

Hardly.

A car dealer never stops looking for an opportunity to sell you something an therefore make some additional profit.

The F&I guy/gal is no exception.

In fact, the manager and ownership of the car dealer expect… no … demand of the F&I person that they hold up their end of the automobile sales process and generate sales for the dealership.

In fact, be advised that if you work hard on the front end of the deal to get not only the price you wanted for the new car, but your trade in as well, I can assure you that the dealership will be looking to the F&I person to re-maximize the profit for the dealer.

In fact, in most cases, much of the front end negotiating and haggling over the car and the trade in has been done mostly with handshake agreements. In the F&I department, the ‘deal’ gets put in writing in the form of a legal document or contract. So now is not the time to lose your tenacity or your focus.

Some dealers may give you the impression that in order for the deal to go through you have to arrange for the financing through their F&I department.

This is simply not true.

If you are a student of this website you already know what financing terms you qualify for and it’s a matter for the dealership to try to do better than what you already know you have.

Even though you may be tired from the days car negotiations, don’t take for granted that all you expect to be in the deal is going to make it to the F&I department. In other words, read the papers you are about to sign.

Be sure to understand the length of your contract as it relates to your payments. Remember, car salespeople will stretch the length of your contract as far out as they can in order to make your monthly payments seem much more attractive. This will cost you money.

If you happen to be considering an extended warranty (a service agreement that kicks in once the manufacturer’s warranty expires), keep a few points in mind.

First of all, there is nothing that mandates that you must purchase one at all.

Know what the original warranty covers… and more importantly what it does not cover. Most go for 3 years and 36,000 miles. Look for the manufacturer’s extended warranty before an aftermarket or 3rd party warranty.

The manufacturer’s extended warranty will be good throughout the country. A dealer offered or 3rd party warranty may have stipulations that you use only specific dealers for your repairs.

If you are looking a 3rd party warranty, make sure you understand the terms of their extended warranty coverage.

Next
Next… let’s look at a couple more products in the car dealer’s Finance & Insurance salesperson’s sales bag and what you can expect.