As I said, that just seems insane. One of the things that I thought was weird about what he was telling me, was when he would tell the salesman that he was paying cash, it was like they didn't really want to talk to him anymore. They really were more interested in selling the note than the truck.
They really were more interested in selling the note than the truck.
You’re right. In my first life I was in that business. It’s called dealer reserve.
A bonus percentage paid to the dealer on each sale.With full recourse agreement, dealer could sell unlimited volume without any approvals and still get the reserve. We had the biggest dealership in America of a very popular vehicle. Everybody was making huge $. We had six repo agencies working for us. As long as we could return the car to the dealer, we’d be paid in full. It was like a pyramid scheme.