fishee

Car was totaled and I'm thinking I'll pay cash for something small and cheap, like a Scion or Toyota Yaris. They come out to around $13,300 and that's about all I have right now in savings. I'd like to put this on my AA citi card if I can.

I called last week to raise my limit from $8,000 to $14,000 and the formula rejected my request although many of my cards have a $15,000 limit. The card is relatively new, around 4 months. Should I just apply to another AA citicard -- I'd have to pay the annual fee (which I'm not doing currently) but I guess it's worth it for 5,000-ish miles? If I apply for another card, how long does it take to get to me -- I really need a car ASAP but I'm willing to take public transportation for a week or two for the miles -- or is that stupid?

(I'm also open to car advice -- anyone own a Scion Xa?)

screwedbyaa

Besides your credit woes, I don't know many dealers who'll let you put a car on a card, so you should check first before you go through all this.

rufflesinc

i have a AA citi gold card and on my statements, it says i have no limit but if i go over my limit, i have to pay that off every month. ie, cant carry a balance over my limit but can charge over that. since you appear to be able to pay it off on the next statement, then it should work for you.

abefroman329

Yeah, your major car dealers (and CarMax for sure) don't like the idea of kicking 3% of the sale back to MasterCard, so don't go that route. Maybe some of your lower-rent used car dealers, but they're not gonna have any Scions or Yarii for sale.

Hopefully you were planning to pay off the card with the money in your savings account, or I'd have to lecture you on the pure stupidity of paying Citibank interest on a car when you could save yourself a lot of money with a car loan.

andrzej

I (somewhat) agree. Few years back I tried the same thing after I agreeded to the final price. The manager agreed to accept $5000 CC charge as a partial payment, but if I wanted to do the whole deal on CC, the agreed to final price was no longer applicable. So it's possible, but you will pay for the the miles with a higher car price.

fishee

I was concerned about the dealerships as well, especially since these cheap cars don't have a large mark-up from invoice. I think they'd be willing to do it with a Lexus where they can "afford" to eat the 3%.

Yes, I have all the cash -- but I'd like to use this as an opportunity to get some miles and then pay off the statement in full. Maybe my negotiations with the various dealers could involve who is willing to let me charge the most? Even if I can only charge $3000, it's better than nothing.

tazzy531

This has been discussed many times on Fatwallet's Finance forum. Most dealers will not allow you to do this because they will have to pay 3% fee to Mastercard. However, people have been able to charge up to $3000 or so of the purchase onto a CC.

abefroman329

Anything is possible - but definitely be prepared to pay more than you would if you were just paying cash or with a loan check.

moman

I too doubt you will be able to charge the car, but see if you can pay $5000-$8000 down on the car on the CC.

Might be worth it to put $5000 down on the card and take out a loan from the dealer for the rest of the amount. Then you can pay it off with the first statement, the dealer is in heaven because of the kickbacks with their partner banks, you've got the AA miles from the downpayment, and you've now got another good mark on your credit report for a 36 month car loan that was paid in full.

fishee

I'll take what I can get. 3000 would be fine.

At what point do I mention using the the credit card -- at the end like andrzj? There's no real haggling involved with the scion since the True Market Value matches the MSRP at this moment.

I had a former roommate who purchased her Rav4 in California with a credit card, don't recall if it was used -- I think she charged around $15,000.

fishee

This is a very interesting approach. Aren't there additional fees involved with my having to take the loan out? Could I get the dealer to eat that?

sggolf

Don't mention it until the very end and keep your options open about walking and going to another dealership. They probably won't let you charge the entire purchase but you can probably get them to agree to do a partial payment. Good luck!

moman

No, there are no fees with my approach. The assumptions are that your credit is good enough to get a car loan. Dealers love it when you go through their partner banks as they see it as an extra profit opportunity.

The only "fee" with taking out a loan is the hit to your FICO score, which considering your credit limit, might be a plus for you to have the paid off car note.

When I bought my first new car at 22, with a 643 credit score (due to lack of credit history), I was able to get the cheapest rate offered at the time. The rate won't matter to you since you are paying it in full on the first month.

Plus if you take the loan, I'll be the dealer will be more willing to put a downpayment on the CC.

Oh - if you decide to just do the CC, say it at the VERY END. Once they think the sale is made, they will do whatever to get you to sign on the line. if you say it too early, they might not take you seriously.

fishee

My credit score was really high last year so I'm not worried about the loan. Does the dealer need to know what I'm doing? I should ask about early payment penalties, anything else? I was sure there was a processing fee involved with taking a loan out but the only time I did that was for a gov't subsidized student loan so maybe it's different. thanks very much for the advice everyone.

skAAtinsteph

I have put a deposit on my card before and then paid the taxes / registration fees with my card as well.

I know someone who baught a motorcycle with his AMEX, the dealer didn't want to go for it at all so he threatened to walk on the deal altogether. The dealer finally relented.