She just wants to pay cash for a new car.

August 22, 2007 9:41 PM

Please help -- How do you buy a new car in California for cash? Dealer has agreed to a cash deal, but at 11th hour, insists on signing a loan agreement?!? Help my cuz get this guy to close a cash deal.

My cousin has saved up to buy a new car for cash in
SoCalifornia. She got the deal she wanted, and they knew
from the start that she was paying cash. So they should've
gotten a deal they can live with, too.

She pays by cashier's check, signs over the trade-in, signs
all the papers, then finally comes the sales agreement...

...and it's a loan agreement.

She declines, they insist. She reads, and the contract
says:

(a) customer can choose to pay cash. Sign this form, and
you're choosing to pay by credit;

(b) oral amendments are not binding, mutual written consent
only.

She declines, they insist, complete with lies and tactics.
Around and around they go. Finally, she leaves. She has a
paper trail on everything she's given them, so she feels she
can get it back with just some hassle. Most importantly,
she'd like to buy that car -- in cash.

What tactic/consumer law/shibboleth/ninja-finger-sign can
she use to get the deal closed without a loan?

P.S. -- In between claiming that it was State Law that she
sign a loan agreement, one of them offered to make it a
"zero-dollar loan." WTF?

Thanks in advance for prompt suggestions. Clock is ticking.

posted by ScarletPumpernickel to work & money (29 comments total)

Offer to walk away from the deal.
posted by b1tr0t at 9:46 PM on August 22, 2007

Legally, their oral contract is binding (probably) but will be more hassle than its worth for a car.

They are most likely trying to hit her with a couple hundred dollars worth of finance charges. It is sleazy, underhanded, and what car salespeople do. If you had a lawyer friend they might be able to make a threatening phone call, but it most likely will not be worth her time.

I would suggest she bring a male and have him pressure the salesmen and walk away if they won't agree to the cash. Sorry, scum of the earth people like this think they can pull one over on women.
posted by geoff. at 9:53 PM on August 22, 2007

She walked already.

Now she has to either come up with a way to force them into
a cash sale, or kill the deal completely and wrestle her
assets away from the dealer.

There has to be some law covering this. (IAobviouslyNAL)
How can they refuse to offer a cash sales contract, and say
"customer may choose to pay cash" on their loan contract?
posted by ScarletPumpernickel at 9:58 PM on August 22, 2007

She's...um...formidable. She threatened to dump the deal,
but the Big Boss was conveniently MIA.

I expect the Big Boss will be the one in charge of trying to
charm her into the deal in the next day or so.

The way she describes their behavior, it sounds like they've
been instructed to say anything to get a signature, because
the agreement nullifies everything they say.

There must be some specific technical threshold where they
must honor her cash request. I was hoping someone on The
Green would know how to push that button.
posted by ScarletPumpernickel at 10:06 PM on August 22, 2007

Run away from the deal.

Do not give them money, you will be rewarding them for scummy behavior.

There are plenty of dealers who will deal fairly with women, believe me. Go to one of them. They will be happy to take your cash. Then, when you have time to research which agency to report this to, do that. One of the places that will be very interested in hearing about this will be the car company (Honda, SoCal Ford, whoever). Get names and what they said.

On preview, if they don't hand the check back the first time you ask for it, I would call the local police immediately.
posted by sageleaf at 10:07 PM on August 22, 2007

Confessions of a Car Salesman
What are the tricks salespeople use to increase their profit and how can consumers protect themselves from overpaying?
posted by anticlock at 10:16 PM on August 22, 2007

Let me pipe in and say perhaps it is not a scam to get more money.

I purchased a new car in 2/2006. I paid cash. I have my "RETAIL INSTALLMENT SALE CONTRACT" here, and it says: "You, the Buyer (and Co-Buyer, if-any) may buy the vehicle below for cash or on credit. By signing this contract, you choose to buy the vehicle on credit under the agreements on the front and back of this contract. [...] Annual Percentage Rate: N/A. Finance Charge: N/A. Amount financed: $XXXXX[...] YOUR PAYMENT SCHEDULE WILL BE: One payment of $XXXXX. N/A Payments, due on N/A. One final payment of: N/A"

I wrote a single check for $XXXXX dollars, gave it to them on that day, and never paid a single cent more.

I am guessing the reason they do this is because the contract gives them more leverage if your check bounces. So it could just be a way to hold you to stricter terms than a purely cash deal would. But I am not a lawyer, I am just a dude on the internet. You should not trust a car dealer, ever.
posted by IvyMike at 10:28 PM on August 22, 2007

Seconding IvyMike. His experience is my experience.
posted by infinitewindow at 10:38 PM on August 22, 2007

FYI: you can cancel a cashiers cheque if it hasn't been redeemed yet.
posted by Mitheral at 10:45 PM on August 22, 2007

"You, the Buyer (and Co-Buyer, if-any) may buy the
vehicle below for cash or on credit. By signing this
contract, you choose to buy the vehicle on credit under the
agreements on the front and back of this contract.

Same contract she showed me. But she gave them a
Cashier's Check it's funds are guaranteed by the
bank. She had to pay the bank in order to get the check.
posted by ScarletPumpernickel at 10:48 PM on August 22, 2007

IvyMike & infinitewindow, did those deals appear on your
credit report, or were they just backup plans?
posted by ScarletPumpernickel at 10:49 PM on August 22, 2007

Right, Mitheral.
I bet she thought it was a Certified Check instead.
posted by ScarletPumpernickel at 10:50 PM on August 22, 2007

IvyMike has jogged my memory, and I too have had that experience. So disregard my previous and lob back to ScarletPumpernickel: Does it say N/A or $0.00 in those places on the contract?
posted by sageleaf at 10:58 PM on August 22, 2007

they should pay for a bonded courier to return the check to her
posted by Good Brain at 10:58 PM on August 22, 2007

I guess it is possible that they are just using a RISA as a template for a sales contract. I can't imagine a law requiring retailers to use a RISA for motor vehicles, regardless of financing. It is possible, but would be bad contract form. I mean a RISA is suppose to be for installment payments, thus the name.

This is curious. In theory your friend should be able to produce her own written contract and ask them to accept it.
posted by geoff. at 11:00 PM on August 22, 2007

Does she still want to go through with it? Then she might consider calling or emailing as high up as she can and politely explaining that unless they honor the deal they made and let her make the astoundingly responsible decision to pay cash and shun credit, she will be calling her local news with the juicy odd news story AREA WOMAN TRIES TO BUY CAR WITH CASH, IS SPURNED. IS OUR ADDICTION TO DEBT AND THE SLEAZE OF CAR SALESMEN RUINING AMERICA?
posted by thehmsbeagle at 11:00 PM on August 22, 2007

The deal does not appear on my credit reports, which I printed in 5/2007, over a year after I purchased the car. There is no loan of $XXXXX dollars, or anything even close, anywhere. The list of accounts contains only credit cards and college loans. (I am looking over the list of "requests for your credit history", and while none of the requests made in that time frame scream "car dealer", the list contains entries which are cryptic and are just a random bank name. It is possible that one of those inquiries is related.)

I do not want to try to convince your cousin to sign a contract she is uncomfortable with, I am just saying a seemingly similar thing happened to me and turned out ok in my case. If she does want the car, she should ask the big boss,"Why is this being structured as a seemingly complex RISA instead of a more straightforward contract?", and be satisfied with the answer.
posted by IvyMike at 11:26 PM on August 22, 2007

Whether or not the contract is legit way of doing it, just the fact that they lied about it being "state law" would make me walk away from these guys.
posted by sharkfu at 11:31 PM on August 22, 2007

Do you know how many car dealers there are in the state of California? A hundred and twenty million. And each one of them knows this. If I were her, I'd tell them, "You must be doing very well for yourself to be able to risk losing such an easy deal. Maybe there's someone else out there who isn't doing so well who'd appreciate my cash more."
posted by Civil_Disobedient at 1:03 AM on August 23, 2007

If it's me:

I tell them they just blew the sale, and ask for the check back. If they refuse, I call the police. Already cashed the check? Let them know you'll be calling the state attorney general. Then I walk. No listening to their pleas, offers of a better deal, whatever. They had a chance to make the sale and they thought they'd get cute about it and try to make a few extra bucks. That's not someone I want to offer another chance to do business with. And there are plenty of other dealerships that will be willing to make a sale.

Once I've got my money back and I'm out of there, I write a letter - not email, but letter - to the higher-ups at the dealership. Explain that you do not feel like they can be trusted to deal fairly and that you will not be considering their dealerships again, and I hope that trying for the extra few bucks was worth losing a customer.

Yeah, I don't trust car dealers.
posted by azpenguin at 1:29 AM on August 23, 2007

Does it say N/A or $0.00 in those places on the
contract?

IIRC, it had both. On the bottom line, it said "Amount
Financed $0"

She also told me in the long version of this story that they
tried to snag her with a one-month loan for the full amount
she was paying. They tried to sneak that past her not once,
but twice. Bastards.

In theory your friend should be able to produce her own
written contract and ask them to accept it.

I think my cousin is considering that. She was Googling
bills of sale earlier this evening.

just the fact that they lied about it being "state law"
would make me walk away from these guys.

Maybe there's someone else out there who isn't doing so
well who'd appreciate my cash more.

Unfortunately, she wants a hard-to-find car, and they have
it. She wants to close the sale, and just pay cash.

I guess it is possible that they are just using a RISA
as a template for a sales contract. I can't imagine a law
requiring retailers to use a RISA for motor vehicles,
regardless of financing. It is possible, but would be bad
contract form.

There IS a CA State law requiring all car dealers to provide
a written sales agreement at the time of sale. So no more
handshake deals. But no requirements that they use a RISA.

I suppose the dealer could refuse all cash sales, but then
they are liable because the RISA says "the customer can
choose to pay cash."


Since they're holding all the cash and cars, and won't produce
a sales contract that represents the transaction, aren't they
breaking the law?
posted by ScarletPumpernickel at 2:04 AM on August 23, 2007

Considering the conduct of these dealers, why in hell would anyone want to buy a car from them? Ugh.

Ask your cousin this: Do you think the car will work as advertised? Do you think that if there's any problem with it, they might try to weasel out of the repair contracts by blaming her for whatever's wrong with the car?
posted by aeschenkarnos at 2:31 AM on August 23, 2007

ScarletPumpernickel, can you please stop pressing enter at the end of each line in the middle of paragraphs? Wrapping works just fine and looks better. Thanks.

Since they're holding all the cash and cars, and won't producea sales contract that represents the transaction, aren't they breaking the law?

Both parties knew that there would be a written contract and until that is signed, there has not been a transaction. You can't make an agreement to make an agreement.

You can ask for your money and your own car back. If they won't give it back to you then go to the police.

It was unwise to give them the assets before signing the contract as you probably now realize. It may also be unwise to continue doing business with these people.
posted by grouse at 2:42 AM on August 23, 2007

I bet if you say what kind of car she wants and put a location, someone on here can provide a non-scummy place she can get the vehicle for cash, if this deal is still stalemated.
posted by cashman at 7:05 AM on August 23, 2007

Does it say N/A or $0.00 in those places on the
contract?

IIRC, it had both. On the bottom line, it said "Amount
Financed $0"

If thats the case, then they are using a RISC as a basic sales contract as others have stated. Amount financed is $0 means you are not "financing" anything, the down payment amount is covering the entire purchase.. pretty normal from what I know of the car biz. Thats how it worked when I bought my 2nd car with cash as well.

If you dont want to sign it for the sake of not signing it you'll need some other contract form and probably the district managers OK to allow his employes to sign and use that, be polite and resolute and work your way up the chain of command...

For all you people over reacting and jumping the gun just because this involves the sale of a car and an easy target for your ignorance (ie car salesmen). Shame on you.
posted by crewshell at 7:42 AM on August 23, 2007

For all you people over reacting and jumping the gun just because this involves the sale of a car and an easy target for your ignorance (ie car salesmen).

Actually, crewshell, it's a good bet people are suspicious because of their experience with car salesmen rather than their ignorance. You say this is "pretty normal" in the "car biz" but so is trying to scam customers out of an easy buck.

I haven't seen the specific contract and neither have you, so there may be caveats in it that would be costly to the buyer. Or there may not. But any time someone is trying to get me to sign a contract that specifically contradicts what they are telling me it means, that is a big ol' red flag. This goes double when the contract also says that "oral amendments are not binding."

I think getting the cashier's check and the title to the other vehicle before coming to the agreement is pretty shady of the dealer, and not giving them back when the agreement is not reached is even shadier. Also probably "pretty normal" but that doesn't make it any less scammy.

I avoid doing businesses that I cannot trust.
posted by grouse at 8:17 AM on August 23, 2007

I'm not sure that the button you were looking for exists. Since getting an attorney involved is going to take time and money that is probably better spent elsewhere, if possible, then maybe a better question is how can your cousin close the transaction while getting the result that she wants. If a close reading of the document (she did get a copy, didn't she?) gives a way that she can pay off the loan in one swoop without paying finance or interest charges, why not just sign the loan agreement, pay it off right away, and be done with it?

If there are finance charges or interest charges or they make it difficult to pay, she might be able cross off those provisions and write in what she thinks is proper, and see if they'll sign that.

This is complicated by the lead-up to the dispute over the agreement, because there's a lot of unanswered questions there. What papers did she sign besides the trade-in? And what were the terms of the trade in? Do they actually have her old car, and if so, what did she get for it? What's the actual detriment of the loan agreement? If they're holding her trade-in and check to force her to sign an unfavorable loan agreement, that may qualify as duress.

For sure, it smells bad all around. But if they're just fussed about using that one form, and her check completely discharges the debt, she should find herself next week with the car she wanted, no outstanding obligations, and the money spent. Basically, she'll be in the same spot as if they'd done it the way she wanted, only more annoyed.

On preview, crewshell's got it.

You can't make an agreement to make an agreement.
Sure you can, after a fashion. Both common law and the UCC let you do all manner of crazy stuff. But that's neither here nor there.

This goes double when the contract also says that "oral amendments are not binding."
By itself, this is actually not all that sketchy (although it can be used by the dishonest in sketchy ways) - it's called an integration or merger clause. But grouse is spot on - if somebody's telling me something that's not in the contract, and I see a clause like this, I hear alarm bells and am sure to parse things very very carefully.
posted by averyoldworld at 9:04 AM on August 23, 2007

Your friend is to be commended for actually reading the thing. However, the problem seems to be that she got to one spot on the page (you choose to buy the vehicle on credit) and stopped reading. Because that line continues: under the agreements on the front and back of the contract.

If there's one payment of [the purchase price] and N/A for other payments, then that IS a cash purchase. At least that's the way my paperwork for my last cash-purchased-in-California car reads.

The wording is confusing, yes, but the reason they aren't giving her another contract is that this is likely the only one they use. So she's at take it or leave it at this point.

And there's nothing wrong with healthy skepticism of car salespeople. Particularly if they were not clear in explaining the specifics.
posted by sageleaf at 9:42 AM on August 23, 2007

The fact that they lied to her, and tried to sneak extra charges through, is reason enough to find any other dealer with this rare car. Yes, it's a pain to start the search over, but it'd be much more inconvenient to be stuck with a lemon because you bought from a dealer who thinks customers are just those suckers you bleed money from.

If the next dealer presents a contract she doesn't like, but otherwise seems to be dealing honestly, she can always cross off any terms that are unacceptable. The salesperson will flip out, but that's just a bit of theatrics to start the re-negotiation off right. Everything is negotiable, including any unsigned contract. That's especially true at a car lot. Either they're willing to make the deal, or they aren't. In exchange for giving up certain terms that favor their side so much, a dealer may bargain for some concession in return. But heck that's what negotiation is all about...
posted by nakedcodemonkey at 2:41 PM on August 23, 2007