Why do auto dealerships balk at cash transactions, but real estate companies prefer them?
In: Economics
Because at a dealership the car isn’t what they are selling. they sell loans and get way more kickbacks and money from that then they do the cars.
much like retail places like Walmart, lowes, Home Depot or any store with a credit card the companies make money off your balances get money from the credit issuer for signups and a percentage of interest paid, just like auto dealers. It’s a new revenue stream and it’s quite healthy for them. If you pay cash they dont see any of those kickbacks, which is why you almost always get a better price when you finance with them.
Latest Answers