Yesterday I got all my financing done with the credit union at my work. I talked with the Toyota dealer and they will be ordering my truck and it should arrive on the first week of October.
I talked with my sales person and the finance manager about the "Dealer Holdback" fee I was being charged. I am very happy with the price I'm getting the truck for, but just the thought of the Holdback was making me feel a little uneasy. For those of you not sure about what Dealer Holdback is, it is an amount on the dealer's invoice that the car company (Toyota) holds back from the dealer, and when the dealer sells the vehicle, the car company gives it to the dealer. So why am I being charged this amount. The dealer is getting $512 from me and Toyota? It just seemed wrong, BUT, looking over the agreed apon price, I'm paying about 2.3% over invoice and what I believe to be 4.1% profit to the dealer. I'm good with this, no matter how they label the charges.
When I talked with the finance manager, he made an analogy that I thought was kinda funny but good: "It is like you have your hands full of cookies, and as you reach for one more, you crumble the cookies in your hand.".
Thinking of buying a new car, read this first (http://www.carbuyingtips.com/car1.htm). Chapter 3 talks about Holdback and Wholesale Reserve.
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