‘Greed has taken over’: Why forced financing has some consumers driving away from buying a vehicle


After waiting months to find an electric vehicle, Vancouver residents Dan West and Bryan Balmer thought the search was finally over.

They saw an advertisement for a used 2020 Volkswagen E-Golf and arrived at the local dealership to take it for a test drive. However, the joy of getting behind a new set of wheels quickly subsided when they offered to pay cash for the car.

“We had the money and it made no sense to finance something that we didn’t have to finance,” said West.

However, West and Balmer said the dealership refused their cash offer and told them the only option was to finance the vehicle.

“They wanted us to finance it or some portion of it, but there had to be something financed,” said West, adding nowhere in the advertisement did it state cash offers were not accepted.

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The car fits us like a glove. It’s the one I wanted, but we were not going to do business with a dealership like that.”

Click to play video: 'Consumer Matters: Battle for price protection'

Consumer Matters: Battle for price protection

The non-profit Automobile Protection Association (APA) told Consumer Matters forced financing is a deceitful tactic.

“It amounts to the customer to a hidden charge that’s not in the ad price. The customer is being asked to pay interest so that the dealer can collect a commission from the lender. That isn’t right if the customer doesn’t need the loan,” George Iny from the APA said.

“APA’s position is if they are going to do that  they need to make you whole because you are paying interest on that loan whether you like it or not for at least three months and in many cases six months .”

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Iny said the APA has heard of several reports of forced financing happening across the country and supply chain pressures are only making it worse.

“What we have seen with the shortages that followed is that greed has taken over,” he said.

The Vehicle Sales Authority, B.C.’s car sales regulator, told Consumer Matters in a statement: ”There is no legal requirement for a motor dealer, or any B.C. merchant as far as we can determine, to advertise that they do not accept cash payments. Subject to a specific law to the contrary, a motor dealer (or any merchant) may place terms, conditions, or restrictions on the sale of their goods or services. This includes how they are paid.”

So what are prospective vehicle buyers to do?  The APA recommends trying to negotiate a discount off the equivalent to the interest penalty you’ll be paying for the vehicle if you do end up financing the vehicle.

The other option is to walk away like West and Balmer if the deal just doesn’t feel right. “It didn’t feel upfront. It felt shady. It felt deceitful,” said Balmer.

&copy 2022 Global News, a division of Corus Entertainment Inc.



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