Originally Posted by kaflyboy
I submitted an application online last night through Ally. i called today to get the interest rate (didnt say it on the approval letter) and they said the dealer had to give me that information. has anyone ever heard of that before? is that where the dealer makes their money buying a low interest rate from Ally then increasing for the consumer?
It can work both ways. Since this is a captive finance company the rate is effected by dealer participation. Some dealers may mark it up, others may have reached certain thresholds where they can offer you a lower rate. It's one of the mysteries we will never fully know since it's proprietary info between Ally and your dealer.
The only way to work the system is to have a valid pre-approval from an outside company and simply tell the dealer, "I am approved with company xyz at a rate of x.x%, if you can beat it then I'll use you. If not then I'll provide my own financing". It's called the art of negotiation.
I went in with an approval from Chase, they beat it by .5% so I used Ally.