Vehicle Pricing: Why Cash vs. Credit Prices Must Be The Same

Secret shoppers are not exclusive to the retail industry or grocery stores, they are alive and well in the motor vehicle industry as well. Why might secret shoppers exist in the motor vehicle industry you ask? Allow me to explain.?

What the Law Says

Federal law requires car prices to be the same whether a customer is paying with cash or credit. Obviously, a credit customer is going to pay interest, so over the course of a loan, they're going to pay more, but the sale price of the vehicle must be the same as it would be for a cash customer. For example, if a cash customer comes in and the dealer says it's $19,999, and a credit customer comes in later that day to purchase the same vehicle and the dealer says it's $21,995, that is against the law. In most cases, secret shoppers are sent out to test whether or not a dealership is abiding by this law.?

Now, of course, credit customers require down payments and the down payments can change depending on the creditworthiness of the customer, but the actual price of the vehicle, what we would call cash price on the bill of sale, cannot change based solely on the fact that it's a credit customer versus a cash customer.

How to Protect Your Dealership

The long and short of this issue? As a dealership, play it safe and abide by the law by keeping your prices the same for cash and credit customers.?Doing so will avoid any legal trouble and contribute to a solid business reputation that will ultimately bring you more business.

If you are looking for more support when it comes to cash vs credit sales, you can find more information at www.georgiacarlaw.com. You can also book a strategy session with us here. We’ll personalize your counsel and guide you through everything to ensure your business is protected.?

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