Itemized invoice - unfamiliar items

[jediwebdude]

I'm about to trade in my 2003 SR5 4WD V6 for a 2007 Sp Ed 4WD V8. My '03 was purchased pre-owned, but the Sport Ed I'm about to buy is brand new. The salesman pulled the invoice and here there are some items listed that I don't see on the Edmunds.com invoice:

TMF $940
1% Finance Reserve MSRP $336

Any ideas as to what these are and if they are negotiable? The salesman said the TMF is to cover the cost of the rebate. I replied with "So it is costing me $940 to get the $1500 rebate?" He said "Essentially, yes."

 

[8666-4runner]

Invoice

Finance reserve is a given on any new vehicle. Usually dealer's won't remove this item. This is figured into the dealer invoice on vehicles (that's why you can buy vehicles under dealer invoice!).

Not sure what the other is, i'm in the Chicago region and we have what's called TDA---this is a fee the dealership pays Toyota to cover national advertising.

 

[jediwebdude]

After going to 3 diff DFW Toyota dealerships, I got 3 diff answers. Fortunately, the most knowledgeable Fleet Mgr was also the one who sold me the 4Runner under invoice before the $1500 rebate.

 

[abash42]

Hello, Im new to these boards, i just purchased a 04 sr5 and i love everything about it. i work in the car business and I am currently training to become a finance manager.

In reference to your question to 1% finance reserve. What happens here is the bank approves you at 7%, if the dealer can get you to agree to the loan for 8% then the bank will pay the dealer money because the bank makes more money. I know in PA the maximum reserve is 2.5%. So if the "buy rate" (the rate banks will approve you at) is 7% the dealer can come to you and say the best rate you qualify for is 9.5% and that is now your contract rate. the difference is known as the finance reserve.

 

[jediwebdude]

In reference to your question to 1% finance reserve. What happens here is the bank approves you at 7%, if the dealer can get you to agree to the loan for 8% then the bank will pay the dealer money because the bank makes more money. I know in PA the maximum reserve is 2.5%. So if the "buy rate" (the rate banks will approve you at) is 7% the dealer can come to you and say the best rate you qualify for is 9.5% and that is now your contract rate. the difference is known as the finance reserve.

Which is why I always get pre-approved through one of my credit unions before I start shopping (I go with the CU offering the lowest rate). Unlike traditional banks and financiers, credit unions are not trying to see how much money they can extract from your wallet.

In this particular transaction, the fleet rep deducted the finance reserve so that he outperformed the other dealerships to land the sale. My credit union beat the Toyota finance rate by a half percent. I'm happy.

 

[abash42]

well thats a good idea, credit unions can be funny because you have to meet certain requirements usually (work somewhere special, live with someone who is a member etc) and they might be able to your credit union rate, as long as you have a good idea what they can do before you head to the dealership. I run into alot of people who think there credit union can get lets say 5.99 on a used car for 60 months, but come to find out they were ,mislead and its 5.99 on a new car. so just do your research

 

[jediwebdude]

well thats a good idea, credit unions can be funny because you have to meet certain requirements usually (work somewhere special, live with someone who is a member etc) and they might be able to your credit union rate, as long as you have a good idea what they can do before you head to the dealership. I run into alot of people who think there credit union can get lets say 5.99 on a used car for 60 months, but come to find out they were ,mislead and its 5.99 on a new car. so just do your research

The three credit unions of which I am a member post their pre-owned car rates and new car rates very clearly on their websites. My wife works in the credit union industry. She has never heard of a credit union intentionally misleading a member regarding rates.

 

[abash42]

hey man,

no not intentionally i think credit unions are awesome and i will never go back to a bank again, some consumers are just confused and dont realize the difference, i have run into it a thousand times you what you do is the best way to save money in the car buying experience.