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Can a dealership charge extra money for financing a car instead of paying cash?
"Is it normal to be charged a fee for not paying cash at a dealership? I was going to finance a car from a dealership. When I was reading the contract, I saw that a $1,000 fee had been added to it, and the salesman told me it was because I wasn't paying cash."
Eric Schad · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
“What probably happened is that the dealer or manufacturer had a special that incentivized a cash payment.
You’ve probably heard of bonus cash and things like that at dealerships. However, some of these deals are only good if you pay cash for the car.
Think of it as a discount. Because you’re financing the vehicle, you don’t get to take the discount, which can then be added onto the final price of your
new car
.It’s standard practice, so if you can pay cash, it’s sometimes the better option.”
View full answer
- Gregory R.
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