Buying a Car in Cash not Better than Buying thru Financing

**yellowsalman** · November 27th, 2008 11:52 AM

I have been canvassing for a brand new car this days. Fortunately, i am planning to buy this through a spot cash transaction. I expected to get better discounts, freebies, etc. as I am buying in cash. But to my dissapointment, i haven't found a dealership that offered me a discount. No one even offered me a free comprehensive insurance or LTO registration. The freebies they are giving are of a lot less value compared to the freebies offered to buyers availing financing. A dealership adviced me to just purchase through financing so that i could avail of their promo.

Now i would like to ask if it is really better to purchase through financing and why? I hope this would shed light to a seeming misconception that it is better to purchase through cash.

**kumagbehota** · November 27th, 2008 11:58 AM

kasi walang interest sa cash buyers. laki kasi ng kita doon. me mga cases nga na di priority ang cash buyers lalo ng kung mabili yung unit... malamang nasa huli ka ng pila...

**yellowsalman** · November 27th, 2008 12:08 PM

It seems ironic. Parang baliktad na nga these days. They tend to discourage you to keep out from debt and practice good financial sense.

Originally Posted by kumagbehota

kasi walang interest sa cash buyers. laki kasi ng kita doon. me mga cases nga na di priority ang cash buyers lalo ng kung mabili yung unit... malamang nasa huli ka ng pila...

**_Qwerty_** · November 27th, 2008 12:14 PM

i think it's still better to buy in cash.. yung mga freebies na binibigay pag financing.. eh binabawi din nila yan sa laki nang interest..

dami namang dealers.. shop around.. kung sino pinakamagandang offer don ka..

**uls** · November 27th, 2008 12:15 PM

hehehe

when u pay cash, somebody doesnt make money on the interest you're supposed to pay if u got a loan

**tidus1203** · November 27th, 2008 12:19 PM

Originally Posted by yellowsalman

I have been canvassing for a brand new car this days. Fortunately, i am planning to buy this through a spot cash transaction. I expected to get better discounts, freebies, etc. as I am buying in cash. But to my dissapointment, i haven't found a dealership that offered me a discount. No one even offered me a free comprehensive insurance or LTO registration. The freebies they are giving are of a lot less value compared to the freebies offered to buyers availing financing. A dealership adviced me to just purchase through financing so that i could avail of their promo.

Now i would like to ask if it is really better to purchase through financing and why? I hope this would shed light to a seeming misconception that it is better to purchase through cash.

Don't get tricked by these car companies pushing you to finance a car just to get a better deal. You have to realize that they make a killing on financing and not so much on cash that is why they are more generous to finance buyers and they will add the sweeteners just to lure you in. But you have to do the math. Even if they don't give you all these freebies the interest alone would wipe out all those freebies and then a lot more. A typical car loan has an interest rate of 20% sometimes even more depending on the tenure of the loan the longer it is the higher the interest rate. Don't fall for this trap! If you can pay cash please do so! And believe me its feels so much better to own the car rather than have a bank having a slice on the car

**yellowsalman** · November 27th, 2008 12:42 PM

i agree with your comment. in the end its much cheaper to buy in cash. maybe that is why we are such in a financial turmoil right now. Companies tend to make more money out of loan interest rather than out of basic profit. Financing is a good thing as it helps us buy the expensive necessities, but i think that we are now at a level that too many people are making money out of financing that they tend to push it too much to consumers.

Originally Posted by tidus1203

Don't get tricked by these car companies pushing you to finance a car just to get a better deal. You have to realize that they make a killing on financing and not so much on cash that is why they are more generous to finance buyers and they will add the sweeteners just to lure you in. But you have to do the math. Even if they don't give you all these freebies the interest alone would wipe out all those freebies and then a lot more. A typical car loan has an interest rate of 20% sometimes even more depending on the tenure of the loan the longer it is the higher the interest rate. Don't fall for this trap! If you can pay cash please do so! And believe me its feels so much better to own the car rather than have a bank having a slice on the car

**tidus1203** · November 27th, 2008 12:48 PM

Its both ways. Consumers should also learn not to buy things that they can't afford and rely too much on credit to buy things beyond their means. I remember during the old days it was shameful to be in debt, dunno why that good trait was never passed down to this generation.

**XTO** · November 27th, 2008 12:48 PM

IMO no question, go for spot cash if you have. shop around, let them know that you’re scouting from different dealers too and pretend that other make is also in your list. don't rush and good luck

**Picard** · November 27th, 2008 12:57 PM

Originally Posted by tidus1203

Don't get tricked by these car companies pushing you to finance a car just to get a better deal. You have to realize that they make a killing on financing and not so much on cash that is why they are more generous to finance buyers and they will add the sweeteners just to lure you in. But you have to do the math. Even if they don't give you all these freebies the interest alone would wipe out all those freebies and then a lot more. A typical car loan has an interest rate of 20% sometimes even more depending on the tenure of the loan the longer it is the higher the interest rate. Don't fall for this trap! If you can pay cash please do so! And believe me its feels so much better to own the car rather than have a bank having a slice on the car

I agree! It feels so much better to own the car while it's brand new than technically owning it only after you've paid off your debt----when you're actually sick and tired of your car already.