It’s all about the points! I do it, you do it, it’s just the perks of many cards. The more you spend, the more points you get and the more “free” stuff you get. So why not try to buy some expensive with one, like a PWC?
When I had someone buying a new or used jet ski from me at the dealership, one of the most common things I was asked is if they could use their credit card? Sometimes, they asked if cash was okay?
In a normal situation, such as smaller transactions, these two payment options are fine.
But when it comes to larger purchase, you may find that many dealerships either refuse cash or credit cards or have strict rules about it. I want to go over the many reasons why credit cards and cash are a no from most dealerships, and what the best payment methods to use.
Cash Is NOT King
People think that “cash is king” for everything, even buying a watercraft.
When I say cash, I mean cold hard dollar bills, not writing a check.
Not only is it dangerous for you to carry that money around, most dealerships don’t want to deal with the hassle either. Though, they may not turn it away, just know the transaction will take longer and may require more paper work.
Messy
The biggest reason why many dealerships hate cash is because it’s messy.
- You need to count it.
- Trust an employee is not stealing it.
- Trust the customer is not shorting you or playing some game.
- And overall… it’s a mess.
Once they get the cash they now have to take it to the bank, and with PWCs costing over $20k now, and many people getting two with a trailer, taking that much to the bank is rough.
It’s simply not worth it, and many dealerships will put a cap on how much cash they can take. (Plus, you don’t want someone sly stealing a few dollars when they count it!)
More Paper Work
At least in the US, if you buy something with cash over a certain amount, you’ll need to fill out extra paper work because of anti-money-laundering laws.
Buy A New Or used PWC With A Credit Card?
The next most common payment people often liked to use when buying a new, or even used, was a credit card.
In general, people like using credit cards because of the points the credit card company gives them.
You’ll come to find that most dealerships don’t allow credit cards or have a hard cap because the “free money” you get back in points is paid by the dealership. Often, these fees can be 1% to 6% depending on the credit card.
Margins
That 1% you’re getting in points may have cost the dealership 3% or more. It’s just not viable for dealerships to eat this cost with such low margins on watercraft.
It’s common to see a hard cap of around $5k for many dealerships when it comes to credit cards.
Interest Rate
It’s also a good point to note that the interest rates on credit cards are not that great, unless there is some special promotion.
You would be better off trying to get financing from a local bank than using a credit card if you can’t pay it in full.
Payment Apps
In this modern world, we have things like the Cash App, Venmo, PayPal and every other type of payment app. These apps may not even work with such large transactions such as buying a jet ski.
You’ll find many dealerships not wanting to take payments with these types of apps due to restrictions on the apps or the level of fraud that comes with them.
Not only that, but some of these apps charge much worse merchant fees than credit cards.
Best Payment methods
There are a few other options that you should consider over cash, credit cards and even payment apps.
- Financing
- Checks
- Debit card
Financing
Something that is interesting is that financing a jet ski is one of the best options that many power sports dealerships like. (Play with our pricing calculator to see monthly payments.)
While there may not be much of a kick-back from manufacturer financing, if the dealership uses another bank, they may get some money if you finance through them.
Even when it’s manufacturer financing, the process is straightforward and effortless. The dealership receives their payment the next day without significant hassle or worry. This arrangement is frequently more convenient for the customer, too, as many may not need to make a down payment. (And payments typically don’t start for a month)
You may even find special promotions like 0% interest rates, with some strict rules or short time-frames, but it’s still better than handing over the cash the day you buy. If you got the credit and can easily pay it off, financing is the best for everyone involved. It’s often cheap money to borrow, while your cash keeps working for you while being invested.
Checks
Walking in with a wad of cash is not ideal, but dealerships don’t mind checks.
With a check, they can verify funds, or you can get a cashier’s check, to let them know the money is good. Walking a check to the bank is easier and safer than a wad of cash. Shoot, you can often deposit checks by the app on your phone.
If don’t want to deal with financing and have the cash in the bank, using a check is a great option.
Debit Card
Checks are great, but in this world, they can be cumbersome.
However, debit cards are allowed over credit cards because the fees tend to be much lower. Debit cards tend to have a flat fee per transaction or a much lower percentage, sometimes only a few cents.
If you’re buying a watercraft, the dealership eating a fee that is less than a dollar or less than 1% of the total cost is more than reasonable.
The problem isn’t the dealership, but the bank, as many have a daily limit. If you want to use your debit card, you need to make sure to raise your daily limit or let the bank know you’re about to make a big purchase.