Can I Buy A Tesla With A Credit Card?


Can I Buy A Tesla With A Credit Card?

Tesla’s can be eye-catching, and with a price that matches a mid-class SUV, it’s understandable how someone would want to get their hands on the luxury cars. The features sell itself right off the bat with many, and some even asking if they can pay for it upfront with their CC.

Can I buy a Tesla with a credit card? According to the manufacturers, Tesla states that credit cards are only able to be used for initial deposits. You aren’t able to use a credit card for down payments or to buy the car on the spot. How much they will allow your card to cover will depend on the location of the dealership.

Tesla shares many valid reasons for not taking credit cards with many others in the automobile industry. In this article, we will cover a few of them and cover important information to anyone thinking about snagging one for themselves. 

Why Tesla Doesn’t Take Credit Cards

Buying a car with a credit card will mean that the majority of dealerships will have to pay out a quarter of the selling fees, essentially losing them a cut of the profit. This means that if they were doing it for everyone, then they could be teetering on the line of bankruptcy. There is a chance that your dealership will allow your credit card to cover minor payments if they have a deal with the business themselves. 

They would also run the risk of delaying their payment for the car. Many card companies offer chargebacks for customers who feel unsatisfied, which could set the money for the car back weeks or even months. Repossessing the car wouldn’t be possible for them either as the payment would be deemed unsecured, letting you off the hook if you refused to pay. 

Will Tesla Do A Credit Check?

You may be relieved to know that Tesla doesn’t do credit checks for their customers, and there isn’t a minimum credit score that you would need to buy or finance one of their models. Buyers with a relatively high credit score +720, will have lower APR interests.

Can You Negotiate A Tesla’s Price?

Tesla states that it refuses to budge on any model prices. If you have a trade-in vehicle, then you may be able to negotiate the reappraisal and increase the trade-in value. Negotiating the delivery charge is possible, and so is a potential “showroom” discount, but none of these possibilities should be relied upon to decrease the payment.  You don’t have a middleman taking commission here. You’re frequently buying directly through the company, which some may not know.

Does Tesla Accept Trade-Ins?

Tesla will accept most models of cars and trucks. This will also go for SUVs and many Vans. You can trade this in for a used or new car, and the site offers the ability to get a custom quote on your car. The quote will be a mix of factors that cover

  • Mileage
  • Age
  • Condition

If you are trading in a non-tesla model, then the quotes will be taken from Kelly Bluebook. You can trade-in your car during payments, but you won’t be able to trade in more than one car for your new Tesla. You will also not be able to trade in your vehicle if it’s been severely damaged, and your trade-in value may drop. 

Make sure when you go to trade your car in that you haven’t made any after-market changes to it. Any modifications that aren’t stock will depreciate the car value. 

Do I Have To Have The Car Title?

You will have to own the car title if you are planning on trading within any of these states

  • Kentucky
  • Maryland
  • Mississippi
  • Minnesota
  • Montana
  • NY
  • Oklahoma
  • Wyoming

You will have to trade your car in on the delivery day as Tesla will not accept the trade-in before or after the time of delivery. If you aren’t happy with your Tesla, they will offer you a check reimbursing you for your trade-in and give a refund for your next purchase. If you have negative equity with the company then you may be expected to pay a fee out of pocket. 

When Do I Pay For My Tesla?

You will have to pay for your Tesla before the day of delivery, and it’s required before your vehicle is even physically picked up. Once the payment has been fully made and marked as complete, the company will deliver the vehicle to you. 

What Are Accepted Methods Of Payment?

The main form of payments come in the form of AHC transfers and bank checks. Many buyers have reported that they were able to buy their Tesla using debit cards. You’ll need to speak to your Tesla representative about your preferred method of paying, as like we said, you will be unable to pay for your Tesla on delivery day. 

You’ll have to pay in full or have a guaranteed from an accrediting financing institution. The company provides a Motor Vehicle Purchase Agreement to help make buying easier, and is often found in your Tesla account. 

Tesla’s Financing

Elon Musk has put in many clauses that can compete with many automobile dealerships and manufacturers, with one of the main perks being there isn’t a middle man to go through for the process. While it does have its perks, there are a few things you need to know before you finance your new Tesla with your credit card. 

There Are Very Few Loan/Lease Options

You’re only going to be able to take a lease out on these newer models

  • Model S
  • Model X
  • Model E (You can’t buy this model after leasing)

They also only offer car-loans for these models

  • Model S
  • Model X
  • Model 3

This means they won’t be able to help you with a lease or loan on any older models. If you’re looking to finance any older models, it will be best to go through a credit union

Those Options Have Very Brief Terms

This is going to vary from what model you are planning on buying. There are only 60 and 72-month leasing options for the X and S models. Model 3 offers a very extensive range of offers starting from 36 months and ending at 72. These terms are somewhat common, but there are many manufacturers out there that offer a broader selection of offers. 

If you are looking to take the lowest term, 36, then you may receive these options as well

  • 10,000
  • 12,000
  • 15,000

Keep in mind that these financing options are only available in 21/50 states in the U.S

You Can Finance At Home

Your entire process can take place online, meaning that you can go through the loan or leasing process in the comfort of your own home. You’re able to design and customize it before placing down a $2,500 refundable deposit. You are able to start financing your Tesla within 30 days of your delivery date. 

Many other car companies will ask that you be pre-approved before having to drive to the dealership for financing options. Many times people are forced to pick out their car at dealerships before going through any sort of financing. 

There Are Electric-Vehicle Incentives

It’s known that an electric car is statistically cost less to fuel than a gas-powered car. Tesla even estimates that the amount saved could be $4,300 to $6,400 over a six-year time period. Many states even have numerous incentives to push electric cars by making you eligible for $1,875 if you purchase your Tesla and have it delivered between Jul 1st, and Dec 21st, 2019

This offer only stands for their three newest models. 

What You Should Know About Financing With Tesla

Your car loan rates here can range from $10,000 to up to 100% of the car’s total value. The company won’t issue you out any prepayment penalties either, meaning you won’t have to pay your lease earlier than you would like. Your loan offer will come with a minimum down payment that will cover the sales tax and many vehicle fees. 

Alternatives For Financing

If you’re a bit unsure if Tesla financing is right for you or don’t get the financing options because you don’t like in one of the 21 states,  there are two reliable alternatives that may help you. 

  • Bank Of America: If you are trying to lease a Model Y, or buy one from a private seller then Bank Of American can help with auto loans
  • Carvana: If you’re interested in financing a used Tesla, this site is the route you need to take. 

Can I Finance With My Own Bank/Credit Union?

Tesla will allow buyers to finance through any 3rd party organization that is deemed reliable, and you’ll have to provide them with your VIN, which can be found in your Tesla account. You’ll have to shuffle out a few required documents to help Tesla verify your organization’s credibility, including the exact dollar amount of your loan. 

Can I Purchase My Tesla At The End Of My Lease?

Tesla allows those who fulfill their lease the option to buy the Tesla under these few requirements that the leaser will have to pay for:

  • Lease
  • Taxes
  • Official Fees

The company does allow you to buy out of your leasing contract early, but Tesla claims that doing so can result in owing them several thousands of dollars for breaking your leasing contract, and they push for people to fulfill their contract to avoid this.

How Is Tesla Different

Even though Tesla stores can be seen in many states, and they aren’t the same as your regular dealership since they cut out the middleman entirely. Cars aren’t sold there either, and they’re built for giving potential customers all the information they need to lease or finance their car. 

Knowing that they won’t be pressured to buy a certain model, or possibly get ripped off is why Tesla stores are so popular. This is part of Elon Musk’s plan to help revolutionize the automotive industry and is forcing other dealerships to up their game in digital marketing to compete with the information Tesla is giving out. Many customers know what they want from the dealership before they even step foot on the lot because they’ve done their research at home.

Many of the workers at the stores only educate customers on model features and answer questions they couldn’t find solutions too. Tesla will only sell their cars online, so the sales pitch is removed from the specialist when they’re disclosing information. Musk states that without placing a Tesla store in busy locations, it would be impossible to educate customers on the models with a typical dealership set-up. 

How Do I Finance With Tesla?

Financing your Tesla can be done in just a few easy steps, and you’ll want to keep your credit card around to pay for the initial payment. 

Visit The Site

Financing and customizing your Tesla starts here. The Tesla Design Studio is a tool that customers use to customize their car according to their needs and makes sure they’re happy with the product before it’s even delivered. You can customize features such as

  • Model: Are you going for the Model X or S? Even the Model 3 can be picked here. 
  • Wheels: Tesla offers three different wheel types
  • Autopilot: This feature can run you up to $5,000 extra and lets your car change lanes as well as brake and accelerate without assistance
  • Speed: Your Tesla can top out at 150mph or 250mph, with the Roadster being boasted to cap at a much higher speed. 
  • Range: This determines how many miles your Tesla can go without charging, and it varies from 259 miles to 335. 

One of the bigger costs that is not stated right off the bat is a charging station. These can easily run up to $700, and it’s a necessity for your electric car. This is one of the main problems that many consumers have with Tesla as it takes a while to charge your car. Refueling your car can take a few minutes, but fully charging a Tesla can take a few hours. 

Visit A Tesla Center

These centers are showrooms that are designed to answer any and all questions. Unlike the Tesla stores, these centers will allow you to test drive your Tesla, which helps people better see for themselves what they would like. Tesla centers occasionally sell Tesla’s directly, but the showrooms are typically limited, which means you may not be able to find everything you’d like there. 

If you don’t live in an area that has a showroom, Tesla holds many driving events in states that they are a bit underrepresented in. This helps Tesla get in touch with many potential consumers. You can find showrooms in states such as

  • New Hampshire
  • California
  • Virginia
  • Colorado

Buy Your Tesla

As we said in the earlier point, you can buy Tesla’s directly in states that feature showrooms. In other states it’s illegal, meaning you’ll most likely have to purchase or finance your Tesla online. Fortunately, buying from their website is a painless process that doesn’t take very long. 

It’s a two step process that starts with you configuring your car to your needs, which include all of the features that we listed in the first point. Your next step is figuring out how you are going to finance, and unless you’re paying for everything up front, chances are you’re going to be a bit picky of your loan packages. While you don’t need a minimum credit score, your loan plan is going to based on the number as well as the payment schedule. 

In Conclusion

Your credit card is only going to come in handy for a very small portion of your transaction, and it won’t be able to cover any down payments. Their reason for not taking credit cards is valid; it puts them at risk of losing profits due to fees, and can even mean they don’t get paid at all in the worst case. Tesla isn’t like many automotive manufacturers due to their direct selling, and not needing a dealership to act as a middleman.

This helps them keep costs low, and forces them to market their stores in high-traffic areas that can create a buzz. Customers don’t worry about being ripped off with Tesla because there isn’t a middle man to take a commission on the sales. You’re more likely to find Tesla stores in the licensed states that we mentioned above.

Their loan and finance plans are going to vary by your model, but not on your credit score. Plans can start at 32 months and go up to 72 months with the chance to purchase your Tesla after your plan is up. Electric-vehicle incentives act as a bonus for these models, especially when you take federal credit into account. Everything is done via online, meaning you’ll have to have a good bit of paperwork with you when you go through your leasing plans. 

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Greg

Hi, I'm Greg. My daily driver is a Tesla Model 3 Performance. I've learned a ton about Teslas from hands-on experience and this is the site where I share everything I've learned.

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