Dealer go-between for private transaction

Hey all, close to landing myself a new car.... but had a question for you all... has anyone ever had a dealer act as a third party on a private individual transaction? I met with this guy who is selling his car and I met with him and negotiated the sale price the other day. I talk to him today and he says that the car will be at the dealer and I will cut a check to the dealer instead of to him.... err????? kinda strange.... I guess he is buying another car at this dealer and the dealer agreed to act as a go-between for me and him. I think the dealer is paying off his loan and then I am just going to pay the dealer to release the car..... it doesn't sound too shady or anything, just a little more complicated then I usually do things. I always pay cash for cars and I generally dislike dealing with dealers because they just ream you every chance they get. So, has anyone done this? Anything I should look out for? My two big worries are add-on dealer fees and the dealer becoming the owner of the car since they will be paying off the loan..... I guess I would get a bill of sale from the dealer for the car so that should protect me in that respect..... Does anyone have any idea if the dealer is going to add tax, tags and titling costs? Or any other BS costs to get their hands in the pie? TIA for any advice or insight you all might have!

Yup, not unusual at all. Saves on taxes for the seller/new car buyer since the trade-in brings the final sale price of the new car down. Dealer wil do it gratis since it helps him sell a new car. You get the benefit of a pro to get all your paperwork done, at no added cost to what you would normally pay anyway. Benefits everyone all around.

thanks for the quick response.... sounds like a good scenario then!

Palting explained this very well. I have sold my last 3 cars privately, but used the dealer from whom I was buying the replacement car to "wash the sale" through the dealership. My dealer was willing to do this as in each case my buyer was from out of state and no local taxes were due on the sale of the used car. It works like this: 1. I find a cash buyer for my car at $35K. 2. I trade the car to the dealer who gives my $35K trade-in on my new car $50K purchase. 3. The dealer sells the used car to the cash buyer for the agreed upon $35K price WITH NO WARRANTY OR OBLIGATION. 4. I purchase the new car and only pay sales tax on the $15K difference just as if I traded the car to the dealer. 5. All money transactions are handled by the buyer's and dealer's banks. No one worries about getting their money. 6. The dealer may charge the used car buyer a few dollars for the paperwork and documentation. In the end everyone benefits except the tax man. Cheers,

The seller won't save tax this way in CA and a few other states. Some states require paying tax on actual purchase price of new car. On trade in, dealers can lower new car price to lower purchase tax. They then lower trade in price to off set the low purchase price. That's another way to save tax and incent the buyer.

Its not a bad way to go from the standpoint that Palting explained. Rememebr this, however, that both the dealer and the owner are going to be making money on this transaction and that money comes out of your wallet--so make sure this is exactly the car you want AND...get a pre-purchase inspection done by an independent party not necessarily the same dealership's service department. It will be 350.00 well spent. Anything needing repair, back it out of the purchase price. Good luck

Try to get a Pcar extended warranty since the dealer is an intermediary.

thanks again for all the advice guys, i'll let you all know how it goes!

hey fred... Ill buy your car for 35K, set it up ill wire the money in the morning.

I would think that if you are buying from a dealer you are paying tax--check your state tax laws--in GA, if you buy from a private seller, it is zero tax...if you buy from a dealer, you pay something like 4 or 5% on a $40-50K purchase it is quite a lump to take.... Just my $.02

The deal was for my 2002 540i. I sold it to my out of state boss. I purchased a 2005 S4. And no, wiring the money is another scam. A topic for another day. Cheers,