F&I and Showroom, February 2019

LETTERS www fi magazine com 4 F I and Showroom February 2019 Group Publisher and Editorial Director David Gesualdo 727 947 4027 david gesualdo@ bobit com Associate Publisher Tariq Kamal 212 433 4450 tariq kamal@ bobit com Managing Editor Kate Spatafora kspatafora@ mgigmedia com Art Director Vince Taroc Graphic Artist Jeff Polman National Sales Manager Eric Gesualdo 727 612 8826 egesualdo@ mgigusa com Great Lakes Sales Manager Robert Brown Jr 248 601 2005 robert brown@ bobit com Sales Marketing Coordinator Amy Hangartner 310 533 2518 amy hangartner@ bobit com E Media and Print Production Manager Brian Peach 310 533 2496 brian peach@ bobit com Audience Marketing Manager Kati Tucker Chairman 1961 2014 Edward J Bobit Chief Executive Officer Richard Rivera President and Chief Revenue Officer Sherb Brown Chief Operating Officer Cyndy Drummey Chief Financial Officer Armand Del Duca Business and Editorial Office Bobit Business Media 3520 Challenger St Torrance CA 90503 Fax 310 533 2503 Change Service Requested Return Address Bobit Business Media PO Box 2703 Torrance CA 90509 Subscription Inquiries 888 239 2455 BobitPubs@ Halldata com Printed in U S A SERVICE CONTRACTS HAVE HIDDEN VALUE TO LLOYD TRUSHEL Your article Some People Just Want to Fight December 2018 Page 22 dances all around the reality Many of us actually do not want a service contract or any other product sold in the box We are actually capable of making wise financial decisions including not paying 2000 or more for a service contract when the experts know the average pay out may be 700 or so We understand we can take that extra 50 a month which we would pay for a service contract and put it aside We understand should a need arise we have the money available Also if a need should not arise we not the F I guy or gal still have the money Buddy via web Hi Buddy thanks for the comment Theoretically you are correct if it works out exactly that way But there is zero guarantee that it will A vehicle service contract provides more than just the possibility of paying a repair should you break down It also does two other things that I personally think are super important First it provides peace of mind This may sound small but to the 78 of Americans that live paycheck to paycheck it allows them to relax It also allows them to keep their vehicle longer if necessary Second it keeps the repair facility honest Most people simply dont know the difference between a 1200 repair and an 1800 repair Most people dont have any idea how many hours it takes to repair a vehicle Heck there are four common labor guides and they dont even agree Recently I had a repair facility try to charge me double for a repair because the manufacturer recommended that both of my O 2 sensors be replaced even though only one was broken But my vehicle service contract said no and I realized that the shop was trying to overcharge me So maybe the insurance provider doesnt always pay out the premium they received but they provide a powerful service Also theyre a business and just like your local grocery store or movie theater they need a profit to pay their employees and keep the doors open Lastly I should share that I not only sell vehicle service contracts but I also always buy them I am a believer Lloyd CREDIT CARDS ARE NOT DOWN PAYMENTS TO RON REAHARD Im an Oregon dealer Our finance contracts say none of the down payment has been borrowed That prohibits taking money down from a credit card Do any states allow that Joseph via web Thanks for your question Joseph To the best of my knowledge there is no federal law that prohibits the use of a credit card for the down payment on a vehicle I would suggest you check with your own legal counsel to see if Oregon imposes any restrictions or prohibitions regarding the source of the down payment Accepting a down payment for a vehicle on a credit card is normally not a good idea since transaction fees reduce profits Theres also the possibility that the customer will dispute the charge Yet many dealers do allow customers to put a certain amount on a credit card although they normally cap the amount at 1000 to 2000 However every dealer needs to be aware of their obligations under the agreements they have signed with each of their finance sources Virtually every dealer agreement contains a statement similar to the following Dealer has received the down payment specified in the Contract and has not made a loan or cash rebate to the Buyer or assisted the Buyer in obtaining a loan from any third party to be used as part or all of such down payment or any other payment on the Contract except as may be specifically indicated on the face of the Contract If a down payment is made on a credit card or the dealership arranged for the customer to borrow the down payment from another source it could give rise to an argument that your dealership is in breach of your agreement Any misrepresentation by the dealer that no part of the down payment was made with a loan or other credit instrument could result in the lender requiring your dealership to repurchase the contract in the event of default You can and should review the terms of your dealer agreements on an annual basis and you may be able to negotiate some of the provisions of those agreements It really depends primarily on the finance source as some agreements may permit credit card down payments I hope this answers your question Ron GETTYIMAGES COM COLDSNOWSTORM Accepting credit cards for all or part of a down payment could be a violation of your dealer lender agreements