I was forced to buy extended warranty for my Honda Accord 08 to get 3.9% APR! I think I was fooled!?

Question

I bought a new Honda Accord 08 day before yesterday. The finance guy at the dealership said that I have thin credit even though I have a 715 score. He said I haven't got an established credit for long enough, that true. I have only been in this country for about 2 years.

He said the bank is willing to give me a 3.9% interest rate only if I buy an extended warranty and install the lo jack ($3000) extra.

He said I would get the money back on a pro rated basis if I canceled my extended warranty in about 6 months.

Can I cancel it right now? The lo jack has not yet been installed, can I cancel that as well?

Did he force me to buy the extended warranty? The bank couldn't possibly say that I have to get the extended warranty to qualify for the 3.9% APR!!!

Please Advise the best course of action!

Answer 1

The problem is, though, cancelling the warranty and lo jack won't do you much good now.  The money returned for those items will be paid to the lien holder (not you) and your monthly payment will still be the same.  So, in essence, you're paying the same payment for no coverage (if you cancel).

You will, though, pay the vehicle off sooner if you cancel the warranty and lo jack.  And, yes, you can cancel the warranty anytime.  Actually, most warranties will provide for a FULL refund of the selling price if cancelled within 30 days.  But, again, that money goes to the lien holder to reduce your principle balance.

And, yeah, there is never, ever, no-way possible that a lender would REQUIRE you to buy a warranty for financing with them.  Believe me, I know.

Answer 2

You might just be lucky ,i think you will have a seven day cooling off time ,go back to the place were you bought the car from and cancel the extended warranty .

Answer 3

I have never heard of being forced to buy an extended warranty to get a better finance rate...that's illegal!  Try and cancell both asap! If you have a problem call consumer affairs or a local TV for help.

Answer 4

This guy took an advantage of you. As long as you have a good credit history (which you do), you qualify for the 3.9% APR without purchasing all that extra stuff. I understand that you've only lived here for 2 years but that's long enough to establish a good credit history.

Ask to speak with the owner of the dealership to make sure that  he knows what took place, that you were not happy with their unethical business transaction and you would like to cancel the low jack (good thing it's not installed yet) as well as the extended warranty. Let him know that you'll file complaint against the dealership with Better Business Bureau if they don't cooperate to resolve the issue.

You need to speak either with the owner or the general manager of this dealership in order to get this resolved as soon as possible. Talking with the finance guy or a sales person will NOT get you anywhere. Based on my personal experiences, the people in charge can help you resolves issue much more efficiently than the pions (so to speak).

Much luck to  you!!!

Answer 5

Holy cow...

This guy needs to be reported immediately. That was BS, pure and simple. I can't believe he told you that. I've never heard nor seen any financing/APR conditional upon purchasing an extended warranty. He was seeing dollar signs, plain and simple.

You can cancel the extended warranty after the first payment is made, and you'll get some refund back (not much).

I'd expose this clown. Go chat with the general manager (after following the advice above: "Check with your lender to see if that was really a condition.") and let him know you certainly don't appreciate that dishonesty, and will bring let everyone know about it.

*Side note* - If he's anywhere near central PA, let me know. I'll gladly go pay him a visit.

**EDIT** -- Ed, yes, he does have the right to "bundle", but to claim that the financing is "conditional" upon the purchases of the add'l items is bunk.

Answer 6

He had the right to "bundle" the 3.9% interest rate deal.  Whether or not you should have accepted it or not is another thing.  People who have resided in USA for less than 2 years can have a terrible time getting credit.  So when you say "i've been in this countryfor about 2 years"  it is very important to know if it is more or less.

Anyway, the LoJack was offered to me for $600.  When i started to leave they offered it for $350.  I almost did it.  I like the idea of LoJack even tho i heard a car thief on tv say that he fools LoJack and OnStar by pulling a sheet of aluminum over the stolen car (i haven't verified if that really works to fool the police but the bad guys are always thinking).

If you keep the car, the warranty might be ok.  My Honda Accord was in the shop zero times in the first 5 years.  That's why i bought it.

I think i'd chalk it up to experience this time.  You've got a great car and a great interest rate.

Answer 7

You did not have to buy that stuff.  He is just a scum bag finance guy.  Cancel the warranty asap, I'm not sure if you get the whole thing back though.  

Unfortunately, lojack is installed in the vehicle, and you can't cancel that.

What you can do is call Honda Financial and ask them whether or not your approval had conditions, when they say no, you go right back to the dealer and throw it in their face that they lied and you want the lojack removed and repaid.

What they did is illegal.

Answer 8

After making 1st payment, you can cancel warrenty.  I don't believe it can effect interest rate cause that is based on credit.