Top Car Dealer Scams

by : Jeffrey Taylor

You did everything you were supposed to do. You put your best deal on the table and they accepted it. Now you move to the Finance Office. You think you are done negotiating and all you need to do is sign the paperwork and drive home. Not so Fast. The Finance office is the biggest profit center in the car dealership. That nice person behind the computer is a slick salesperson. It is his job to review the deal and see where he can squeeze more profit out of you.

Do not be in a hurry to sign and get out or you will be very sorry. A good finance salesperson will nail you for $3,000 - $4,000 more dollars and hide it in your contract if you do not keep your guard up. First of all, learn to say NO to anything they try to upsell you on. You must read the contract very carefully to make sure the numbers are exactly what you agreed upon. There are many little scams that occur in the finance office but the one I hear from readers the most is the Subject to financing scam.

Once you sign you are stuck. Too many people in their haste to get home, sign the contracts without reading them thoroughly. They get home and start looking through the paperwork and find items they didn't want or loan rates that are higher, the length of the loan has been extended etc. Once you sign the contracts you are stuck. You already signed a form that stated that you read and understood all the items in the contract. No court is going to hear your case. Take your time and read everything. If you are not good at reading contracts bring someone with you that can. Never take the Finance salespersons word for anything!

The Subject to Financing clause scam. This is a very common tactic finance salespeople use. If you see this on the contract do not sign and above all, do not drive the car home. Another common term is Subject To Loan Approval. What usually happens here is several days after you drive home with your car, you receive a phone call from the salesperson that your loan fell through and you need to come back in and resign through another lender for more money. They may say we have great news, we got you a lower payment, and all they have done is increased the length of your loan. They do this more often with bad credit or sub prime buyers who are usually more cooperative. This occurs quite often on weekends when the lenders are closed. Just tell the finance salesperson you will come back Monday after we have a confirmed approval.

If they don't have your loan approved, stand up and tell him that you will come back and sign when you have an approved loan with a payment book. Never sign a contract without knowing your lender, interest rate, length of loan and monthly payment. Once you sign and drive home with your new car you are at their mercy and you will end up paying more.

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