Poll: If you financed with Ford Options did dealer increase the interest rate? Did you know they could?

[RMoore]

I learned in another thread that even if you qualify for the best possible interest rate quoted by Ford.com for their Options financing at the time you purchase, dealers can actually increase the interest rate up to a certain limit. I'm not sure how well known this or how often dealers actually increase the rate. I'd be interested in seeing some data on these so posted this poll. I broke the poll into 2 sections depending on 1) whether you financed with Ford Options, and 2) whether you haven't but were aware that the dealer could increase the rate.

Edit #1: in the first response I am including the possibility that you got a better than advertised rate (at suggestion of @macchiaz-o)--didn't seem like I could edit the actual response wording.

Edit #2: suggest answering 3 and 4 regardless of whether or not you used Options, as pointed out by @generaltso in a post below.

Sponsored

 

[macchiaz-o]

The dealership could choose to sell at a discounted rate, lower than shown as best rate on ford.com. In effect the dealer is putting more of their money into the deal.

You may want to add that to your poll, too.

 

[RMoore]

The dealership could choose to sell at a discounted rate, lower than shown as best rate on ford.com. You may want to add that to your poll, too.

Interesting point, I hadn't thought of that. My guess is that's rare and I was more concerned about recent issues raised where they increase the rate. But if others write that that happened to them I could modify.

 

[macchiaz-o]

Interesting point, I hadn't thought of that. My guess is that's rare and I was more concerned about recent issues raised where they increase the rate. But if others write that that happened to them I could modify.

I may be mistaken, but I believe that A- and Z-plan customers (employees and retirees) can get a reduced interest rate.

 

[RickMachE]

I may be mistaken, but I believe that A- and Z-plan customers (employees and retirees) can get a reduced interest rate.

No. But the dealer cannot mark up the rate for A/Z plan customers. They get tier 0/1 as long as they qualify well enough.

I posted in reply to @RMoore's post elsewhere that dealers have ALWAYS had the ability to mark up interest rates, on financial transaction, unless it's a locked promo rate from the auto company, like "0% for X years". There is nothing unique to Ford Options in this regard.

The vast majority of car buyers are clueless as to the rate the auto company offered for them, since it's not revealed, as compared to the rate they got from the dealer, whether it's Ford Options, a lease, or a normal loan.

 

[RMoore]

No. But the dealer cannot mark up the rate for A/Z plan customers. They get tier 0/1 as long as they qualify well enough.

I posted in reply to @RMoore's post elsewhere that dealers have ALWAYS had the ability to mark up interest rates, on financial transaction, unless it's a locked promo rate from the auto company, like "0% for X years". There is nothing unique to Ford Options in this regard.

The vast majority of car buyers are clueless as to the rate the auto company offered for them, since it's not revealed, as compared to the rate they got from the dealer, whether it's Ford Options, a lease, or a normal loan.

Yes, appreciate your weighing in there. I'm curious as to just how clueless folks here are (I was and suspect many others are too), and also how often dealers take advantage of that with respect to the Options deal.

 

[RickMachE]

Yes, appreciate your weighing in there. I'm curious as to just how clueless folks here are (I was and suspect many others are too), and also how often dealers take advantage of that with respect to the Options deal.

Just so you understand, they're not "taking advantage" of the customer. The dealer can obtain financing from Ford Credit, or their own financing companies or banks. They can mark up the rate to the limit that they are allowed by law, or by the lending institution. The fact that the customer could get a lower rate by another means is up to the customer to figure out.

Anyone can join a credit union like PenFed, and get a low rate right now. Yet they take higher rates with auto companies. Why? Because most consumers are clueless when it comes to buying ANYTHING.

 

[RMoore]

...dealers have ALWAYS had the ability to mark up interest rates, on financial transaction, unless it's a locked promo rate from the auto company, like "0% for X years". There is nothing unique to Ford Options in this regard.

Just an additional comment here about this. I could be wrong but my sense is that this issue with Ford Options is a bit unique in that we can also see the interest rate that Ford is quoting when we choose Options in that finance section, including what the payments will be. And I think folks expect that when they go to the dealer, they will get that rate since it is "advertised" as such. I understand the disclaimer that appears somewhere that the dealer can increase this rate, but the prominence of the listed rate under the Options choice that is evident from the on line process makes me think this situation is a bit different from someone walking into a dealer buying a different car and being given a finance rate.

 

[macchiaz-o]

No. But the dealer cannot mark up the rate for A/Z plan customers.

Ok. I have Ford Options specific information from dealer guides that states otherwise, but I cannot share the specifics. However, it's always possible that policies have changed during the last year, and it's ok if we disagree since it's not important here.

The vast majority of car buyers are clueless as to the rate the auto company offered for them, since it's not revealed, as compared to the rate they got from the dealer, whether it's Ford Options, a lease, or a normal loan.

We're not clueless. That implies we'd get a better offer if we went directly to Ford Credit, but that's not an option at all. Ford Credit doesn't sell loans directly to retail customers. Only the dealerships do. The only rates that matter are the ones dealers offer, and any viable alternatives a shopper researches on their own (bank and credit union loans, etc.).

 

[RickMachE]

Ok. I have Ford Options specific information from dealer guides that states otherwise, but I cannot share the specifics. However, it's always possible that policies have changed during the last year, and it's ok if we disagree since it's not important here.



We're not clueless. That implies we'd get a better offer if we went directly to Ford Credit, but that's not an option at all. Ford Credit doesn't sell loans directly to retail customers. Only the dealerships do. The only rates that matter are the ones dealers offer, and any viable alternatives a shopper researches on their own (bank and credit union loans, etc.).

I'll rephrase.

We're unaware of the rate offered by Ford Credit, unless it's shown in a promotion, because we have no way to learn of it.

 

[RMoore]

Just so you understand, they're not "taking advantage" of the customer. The dealer can obtain financing from Ford Credit, or their own financing companies or banks. They can mark up the rate to the limit that they are allowed by law, or by the lending institution. The fact that the customer could get a lower rate by another means is up to the customer to figure out.

Anyone can join a credit union like PenFed, and get a low rate right now. Yet they take higher rates with auto companies. Why? Because most consumers are clueless when it comes to buying ANYTHING.

In the case of Ford Options, our failure to shop around for a lower rate is not really evidence of being clueless since doing so removes some of the advantages of the Ford Options program. And the dealer increasing the Options interest rate is different from the situation in which other rates like PenFed's are lower and we should be aware of that so why worry. That's not an apples to apples comparison. The issue here is not comparing the Options rate to those of other programs, it's that there are two different versions of the rate for the same Options program, the one posted on the website, and the one the dealer is offering. That's what's somewhat unique here.

 

[generaltso]

There is no option in the poll for getting the best rate but knowing that the dealer could mark up the rate. Why do you only want to know if people were aware of this if they didn’t use Options? In my case, I was aware that the dealer could mark up the rate, but they didn’t.

 

[jamelski]

I got 1.4 option 48 with 2500 rebate. Was the best deal over flat out buying at .9%.

The 2500 rebate mads a difference for me

i won’t be refi. I looked around nothing is cheaper unless I go 36 month which I don’t want to do lol.

I’ll stick with ford credit just paying more each month. Which does lower your ballon payment as long as you Do the correct payment option each month. I spoke with ford credit and as long as you

either 1 call them when you over pay To put the extra on the ballon payment or you do the option on the website that pays the monthly payment and any extra will go to the ballon payment with out having to call in ZING

 

[Nklem]

I actually got a better rate than was currently advertised in my area.

 

[RMoore]

There is no option in the poll for getting the best rate but knowing that the dealer could mark up the rate. Why do you only want to know if people were aware of this if they didn’t use Options? In my case, I was aware that the dealer could mark up the rate, but they didn’t.

Good point. You're correct that responses 3 and 4 didn't really need to refer to whether or not Options was actually used. Nothing like peer review to make you realize you didn't think of everything. I can't edit the poll itself so edited my thread starter post to address your comment.

Sponsored