What's Cutters policy on credit cards?

[Mathew]

Hey Jon, this quick question popped into my head.

When I was getting my car, i was thinking it would be a very smart idea to buy it wth a credit card. You could get a huge chunk of rewards points and/or frequent flyer miles. I had asked my dealer, and he said they only accept credit cards for purchases up to $2,000. What's your policy on this over there?Have you heard of any dealers that would let you charge the entre car?

[Dr. Phil]

Originally posted by ///Mathew
Hey Jon, this quick question popped into my head.

When I was getting my car, i was thinking it would be a very smart idea to buy it wth a credit card. You could get a huge chunk of rewards points and/or frequent flyer miles. I had asked my dealer, and he said they only accept credit cards for purchases up to $2,000. What's your policy on this over there?Have you heard of any dealers that would let you charge the entre car?
I doubt it :dunno: Not to answer for Jon but it reminded me of a story..............

Frat brother from college tried to do that with a Corvette purchase. Pulled out his corporate Gold card and told them to charge it. They thought he meant deposit, he said "No entire balance":yikes: The ending up giving him several hundred more in discount since credit card % hold would have wiped out their profit.

[DaveN323i]

My dealer only allowed me to charge $5,000 on the credit card. So, I said, charge it 8 times. :D He did not go for it.

[beauport]

When I was recently paying for my 330Ci I asked the same question, can I put it on my card, they said yes, but only up to 5K on the card. 5K in points is better than none in my mind.

[Jon S.]

As a general rule, we try to discourage using a credit card for
car purchases. With our margin on "Internet Special" deals
(sometimes only $1,200 over invoice), there's not a whole
lot left that we can give up just so that somebody can earn
some extra air miles...

Customarily, we'll take $2K or so on the credit card.
Sometimes, a lot more ~ depending obviously on the deal.

One time we **did** let a buyer put the whole thing
on plastic. If I can recall correctly, it was a Porsche,
and we had over $10K in gross profit...


***Now here's an interesting side note:***

"It is not permissible for clients to supply drive-off fees
in the form of credit card charges. Credit card charges are considered third-party loans and are not appropriate when done in conjuction with BMWFS contracts."
--BMWFS Financing Handbook

[Patrick330i]

Excuse my ignorance here, but what do you lose by allowing the customer to charge the car on his credit card? You get the price you charge. The CC company takes the hit in terms of points or rebating, so I don't see what the problem is. I can understand if there are some legal concerns with who actually owns the car if the CC holder doesn't pay his bill, maybe, but am I missing something?

Originally posted by Jon Shafer
As a general rule, we try to discourage using a credit card for
car purchases. With our margin on "Internet Special" deals
(sometimes only $1,200 over invoice), there's not a whole
lot left that we can give up just so that somebody can earn
some extra air miles...

Customarily, we'll take $2K or so on the credit card.
Sometimes, a lot more ~ depending obviously on the deal.

One time we **did** let a buyer put the whole thing
on plastic. If I can recall correctly, it was a Porsche,
and we had over $10K in gross profit...


***Now here's an interesting side note:***

"It is not permissible for clients to supply drive-off fees
in the form of credit card charges. Credit card charges are considered third-party loans and are not appropriate when done in conjuction with BMWFS contracts."
--BMWFS Financing Handbook

[Mathew]

thanks for the info jon

[beauport]

[QUOTE]Originally posted by Patrick330i
[B]Excuse my ignorance here, but what do you lose by allowing the customer to charge the car on his credit card?

Any merchant who offers credit cards is charged a percentage of the sale for the use of the card and the amount varies according to a number of things but usually runs from 1 - 4 % of the total amount. So buying a car on a CC could cost the dealer quite a bit of $$.

[operknockity]

Another data point... Beverly Hills BMW only let me put 2.5K on a credit card.

[Ben Chou]

Originally posted by Jon Shafer

***Now here's an interesting side note:***

"It is not permissible for clients to supply drive-off fees
in the form of credit card charges. Credit card charges are considered third-party loans and are not appropriate when done in conjuction with BMWFS contracts."
--BMWFS Financing Handbook

Intereresting....I have done this twice already. Guess most dealers don't know or aren't really strict about it.

[Alexander]

I was kind of wondering about this too, since I have an AmEx card that gives 1.5% cash back. I don't have anywhere near the credit limit to put an entire M3 on it, but was wondering how things would turn out. :)

[lib]

Originally posted by DougDogs


All merchants have to pay the CC company for the transaction. A few years ago, many vendors stopped taking American Express when they raised their rates.

Taking too much on a card costs the vendor too much profit.

edit: oops, missed beauports post on same info

When AMEX increased their rates, my company threatened (probably shouldnt call it a threat) to drop AMEX support.. they allowed us to remain on the same rates, albeit with a higher minimum requirement.

There is no really good way of accepting payment. I make up for the loss due to the discount rate by getting impulse buys.

With something like cars, there arent enough impulse buyers to warrant accepting credit cards.

I bought my first two cars with my credit card for frequent flyer miles. But it was a planned thing.. I had the available cash, and paid off the card. My ex-neighbor bought an Audi TT on credit card and his house is up for auction at the end of the month. He didn't have the credit to get a TT without using his credit card.. my question is, how did he get that much available credit on his credit card if his credit is bad?

The bottom line is.. banks are stupid.

[lib]

Originally posted by beauport
[QUOTE]Originally posted by Patrick330i
[B]Excuse my ignorance here, but what do you lose by allowing the customer to charge the car on his credit card?

Any merchant who offers credit cards is charged a percentage of the sale for the use of the card and the amount varies according to a number of things but usually runs from 1 - 4 % of the total amount. So buying a car on a CC could cost the dealer quite a bit of $$.

Low-risk merchants should be getting discount rates close to 2% or less. I would hope businesses accepting credit cards are operating on margins greater than 6% on average. $1000 over invoice is quite a bit less than 6%..