Questions to Ask a Finance Manager

The questions

Open any question to see why it works.

1. 1

   Is this the buy rate, or has something been added to it?

   Lenders quote the dealership a rate, and the dealership is usually permitted to mark it up and keep the difference, known as dealer reserve or participation. Asking for it by name signals that you know the markup exists, and the number sometimes moves before anything is signed.

2. 2

   Which lenders did you send my application to, and what did each one come back with?

   Applications often go out to several banks at once. You want to know whether you are being shown the best approval or the most profitable one, and whether the bank you already use was even asked.

3. 3

   What is my approved rate before any of the products are added?

   Some finance offices quote a rate that assumes you are buying a service contract, then present the products as though they cost nothing. Separating the two lets you judge the loan on its own terms.

4. 4

   Can I see the amount financed split into vehicle price, taxes and government fees, and everything else?

   The everything else line is where add-ons live. If the three parts do not add up to the total you were quoted, the gap is the part of the deal nobody has explained to you yet.

5. 5

   What is the term, and what would the payment be at a shorter one?

   Payment shopping is how long terms get sold. Seeing sixty and seventy two months side by side shows you what the extra year costs in interest, which is almost always more than the monthly difference implies.

6. 6

   What is the total of payments over the life of this loan?

   Most contracts disclose this figure somewhere, and it is the one number that makes two deals comparable. People who negotiated hard on the sticker are often startled by it.

7. 7

   Is there a prepayment penalty, or is this precomputed interest?

   This decides whether paying the loan off early saves you anything. Simple interest loans reward early payoff; precomputed contracts may not, and refinancing next year is a plan that quietly fails right here.

8. 8

   Which of these fees are set by the state and which are set by the dealership?

   Title and registration are fixed and not negotiable. Documentation and dealer preparation fees are the dealership's own invention, and whether they can move depends on where you live. Nobody volunteers which is which.

9. 9

   What is the doc fee actually covering?

   The answer is usually paperwork handling, and in some states the amount is capped by law. Where it is not capped it is simply a price, and prices can be discussed even when the fee itself cannot be removed from the form.

10. 10

    Is anything already installed on this car that I am being charged for?

    Glass etching, paint sealant, nitrogen in the tires and tracking devices are often fitted before you arrive and appear on the contract. Ask whether the charge can come off if you never asked for it, and whether the item can stay on the car.

11. 11

    What does the service contract cover, what does it exclude, and who administers it?

    The exclusions and the administrator matter far more than the coverage list. A manufacturer backed contract behaves differently from a third party one, particularly over who you argue with when a claim is denied and which shops are allowed to do the work.

12. 12

    Is the service contract cancellable, and what do I get back if I cancel next month?

    Most are cancellable with a prorated refund, which means today's yes is reversible if you get the terms in writing. Ask to see the cancellation clause in the contract rather than accepting the verbal version of it.

13. 13

    Do I actually need gap coverage here, and what does my own insurer charge for it?

    Gap matters when the loan is bigger than the car is worth, which depends on your down payment and the term. The same coverage is often available from your own insurer for a fraction of the dealership price, and you can add it later in the week.

14. 14

    Is any of this required for the loan to be approved?

    It is not, and the answer should be a plain no. If anyone tells you a lender requires a service contract or an add-on product before approving financing, that is the point to stop and read every page.

15. 15

    Can I see the payment without the add-ons?

    Add-ons get presented as small increases to a monthly figure rather than as prices. Asking for the base payment turns them back into a number of dollars, which is the form in which people decline them.

16. 16

    If I use financing from my own bank or credit union, does the price of the car change?

    Sometimes it does, because dealership profit moves between the car and the loan. Knowing the answer before you commit tells you whether your outside approval is leverage or merely an inconvenience to them.

17. 17

    Is this a conditional delivery, or is the financing final today?

    If the contract is contingent on a lender approving it later, you can be called back days after taking the car and asked to sign again at a worse rate. Ask to be shown the line in the contract that says which of the two this is.

18. 18

    What happens if the lender does not fund this contract after I drive away?

    The answer describes how the deal gets unwound: whether your trade comes back, what happens to the deposit, and who pays for the miles you have put on the car. It is worth hearing out loud before you sign, not after.

19. 19

    Can I take the paperwork home and read it before signing?

    It is a reasonable request and the reaction to it is informative on its own. Refusal, or a deal that expires tonight, is the clearest sign that something in the stack will not survive careful reading.

20. 20

    Which numbers here are different from the ones we agreed on outside?

    Ask this last, with the sales worksheet on the desk in front of you. Price, trade allowance, payoff on your trade and down payment should match exactly, and the finance office is where they most often quietly do not.