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Back End Voo-Doo
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The Finance Department of any automobile dealership is an interesting place. When most folks enter these hallowed halls, they are still a little shell shocked from the negotiation process they just survived. Some are happy campers, having just succeeded in getting their monthly payments down to just about where they wanted them to be. Some are still a tad grumpy from the sticker-shock realization that cars just plain cost a lot more than they did five or six years ago.
Before you breathe a sigh of relief and let your guard down, it's time to get ready for round two. Don't let yourself fall asleep at the wheel or Back End Voo-Doo will jump your payments up from the almost comfy $500 a month payment up to $550 or even $600.
Yikes! Back End Voo-Doo? What is that?
Profits from the sales made during the finance process are known as money made on the "back end". The back end of the deal refers to anything added to the financed price after the vehicle price has been negotiated. I call it Voo-Doo because when you walk out of finance, your payment may not look anything like what it did when you walked in.
The kinds of things I'm referring to here include undercoating, fabric protection, extended warranties and life/disability/gap insurances.
I'm not going to sit here and tell you these things are worthless. I wouldn't do that. Really. What I will tell you is that you need to carefully consider each additional item presented to you.
One man's opinion about:
- Extended warranties - Can be extremely expensive. May be worth consideration for a used vehicle no longer under manufacturer warranty. Careful - a lot of breakable items aren't covered, there may be high deductibles, and for us living in Alaska, paying for shipping of parts should be a deal killer. You don't even want to guess how much it costs to ship the rear axle of a one-ton duallie up to our fine state. A side note is in order here: If you do purchase an extended warranty and you sell or total your car, be sure and apply for a pro-rated refund.
- Fabric Protection - Please. Go to Wal-Mart, get a couple cans of high quality fabric protector such as Scotchguard from 3M. You're going to spend about $20 and get the same level of protection as the $200 job the finance department is going to sell you.
- Undercoating - Make certain you understand the terminology here. This is not rustproofing. It is sound deadener. it will do nothing to enhance the rust proofing that is applied during the manufacturing process for nearly every make of automobile
- Additional Insurances - Your call. Go with your comfort level and your own financial situation. Gap insurance is a must, however.
These tips should put your mojo into a place where the Back End Voo-Doo can't get you. Keep your wits about you when you head to the finance department. The car deal is not done until you drive it off the lot.
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