How to Buy a Car With a Debit Cardby Scott Damon
Paying for a car can be done a myriad of ways. A prospective buyer may choose to trade in an old vehicle, pay cash for the car, finance the balance, or use a combination of all three payment methods. However, some people prefer to purchase a car with their debit card. There can be an advantage to the buyer if their debit card offers rewards such as cash back or airline miles. But before you plunk down the plastic, there are some things that need to be taken into consideration.
Check to see if you have a maximum daily limit that can be spent with your bank. Some banks place limits as to how much can be spent in a single day from a debit account. This can help prevent a large amount of fraud if your card is lost your stolen. If your card does have a limit, ask the bank if it can make an exception for your car purchase.
Ask the dealership if it accepts debit cards. Many dealers separate the "parts and service" side of their business from the car sales segment of their business. This is because each time a debit card is used, the dealership has to pay a transaction fee. If a transaction fee is 3 percent, for instance, it can cut into the profit that the dealer was planning on. So while the dealership may accept the debit for service and repair, it might not for a straight purchase.
Pay for the car with your debit card. If the dealer does accept debit cards for car purchases, they will simply total up the amount due inclusive of taxes and registration fees (which vary by state) and swipe your card. Just make sure you have enough cash in the account to pay for the total once those additional fees are added.
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