Loan kickbacks

I'm prequalified for a new truck loan. Local dealer has a credit union he works with that has a lower loan rate than I got at my bank. How much kick-back or profit does the deal make, IF I use "his" credit union or bank ?

Any answers you get here would just be guesses. If you get a price on the truck you want and the loan rate is lower then you found on your own who cares?

I can't imagine you could use it as a bargaining chip to negotiate price. By taking the lower interest rate through them... you're saving money.

And, if you don't trust the dealership in their offer, you can always see if your bank/credit union will match it. You never know... if you have a good relationship with them, they just might.

loan kick backs can range from $100 to $500 in my experience. I've literally watched the finance guy flip through his book in front of me showing me how much he gets paid by the banks that he decides to go with.

Ultimately, the will try and go with the bank that offers you a "reasonable" rate based on your credit score, as well as the most amount of money back to the dealer. Then when you say, "hell no" to that rate, they start searching for better rates and a kick back thats not too much lower than the one linked to the first offer they threw at you.

it all depends on your credit and how bad the dealer wants your business.

by law a dealer can legally mark up an apr by 2% (atleast in minnesota).

you can always use your CU as a negotiating tool, but sometimes the dealer may give you the better apr. EX: i purchased a new '13 camaro in '13. my cu was 1.99. the dealer asked me if i would go with them. i sad if they beat them i will. sure enough i had a 1.65.

some dealers do a "buy-sell" meaning they sell you the loan for what they "got" it for and are not marking up the apr at all. this is what i got on my '15 ram. my neighbor was the finance manager so he actually called the bank and had them drop my rate by .5% it was a 2.2 and got it for 1.7 and he did a buy sell to me. the dealer will make about 100-200 off my deal.

on a side note why should it matter if a dealer gets a kickback as long as you get the lower apr?

with dealers being able to mark up an apr, this is how most will give you an extra rebate if you finance through them.

Ugh, math.. shoot me now.

^^ This mentality is why I will be paying for my truck for the rest of my life. But fk it, you only live once right? lol