This is a guest post from Sheryl in Ontario, who is 40 years old with a grown daughter, and is trying to rebuild her retirement dream just 20 years too late for early retirement.
My full time job is in the admin department of a new car dealership. Part of my daily tasks is to process the paperwork after a customer has purchased and taken delivery of a vehicle. The difference in the amount of paperwork between a cash deal, and one that has been financed is substantial.
For a cash deal, the only paperwork needed is a bill of sale, 2 internal flow sheets (to make sure all the steps are taken properly to prepare the car for the customer), a copy of the ownership, proof of insurance, proof of payment, and any extended warranties (or waivers of purchase for warranties).
If the customer has financed,there is all of the above, plus the additional paperwork includes credit applications, proof of identity forms, loan contracts, copies of communications from the bank if the bank needs more than the standard data, proof of income forms, as well as either registration forms or additional waiver forms for payment protection or life and disability insurance.
Most dealerships I’ve had experience with, after you have agreed to purchase the vehicle, you are then taken to see the “Business Manager” , which is just a fancy title for another salesperson that sells financing, accessories, rust proofing, extended warranties and insurances. When paying cash, the time spent with this second person can be reduced significantly, as you have removed most of the items they would use to upsell you. A cash deal, there would mainly be accessories, extended warranties on the tires or mechanical components, or rust, fabric and paint protection. No payment protection, no life insurance, no using the extended warranty as a lure to make sure you have coverage for the term of your payments.
If you are anything like me, the less time I spend with a salesperson, the better; and if I can reduce the need / opportunity for them to spend time with me, I’ll find a way to do it.
Save money on interest, save time and hassle, reduce paper usage by just paying cash.