Of all the industries out there, the types of business to most often receive complaints are those involved in car sales. Better Business Bureaus across the country receive tens of thousands of complaints each year, regarding new and used car dealerships. The automotive industry is increasingly competitive. As such, unscrupulous car dealerships are trying harder than ever to get you to buy a car. Following are the top dealership scams and how to avoid them.
The salesman shuffle. You’ve looked at a car or two, and you’ve decided they simply aren’t the right vehicle for you. You’re about to leave, and the salesman you’ve been working with asks you to just wait a moment, while he let’s his boss know. You don’t want to be rude, so you wait. Several minutes later, the floor manager or sales manager is there and the high pressure sales begin. He tries to close you when the first salesperson couldn’t. This is not only overly pushy, but a waste of your time. Remember, your time is valuable. If you’re truly not interested in the vehicle, it is OK to leave. Don’t worry about hurting the salesperson’s feelings.
Most of the time scam dealers often tend to offer mis-leading information about cars. it is always good to know about the car in-depth before making a purchase. You might have to read wide range of magazines and blogs. Searching for brand specific magazines and acquiring knowledge from them is vital. Some offline publications offer fabulous and in-depth news about cars and you may also seek reliable blogs such as Hyundai blog and news to know more.
Financing fall through. Once you’ve found the car you’d like to purchase, financing is the next big step, and a step many buyers dread. The Finance Manager works with you, presents you the loan paperwork, interest rate and payment. You sign the papers and drive off with your new car. Several days later, you get a call from the dealership letting you know that they weren’t able to get you the financing at the low rate they quoted. Instead, they offer you a higher rate loan. Now, if you didn’t provide the dealership with accurate information on your income or debts, this may not be a scam. However, if you were truthful, this is a scam that some dealerships use to get you to accept a high interest rate loan, knowing that once you’ve been in your vehicle for awhile, you won’t want to give it back. Avoid this scam by securing your financing on your own, before you go to the dealership. At the very least, talk to a bank and find out what interest rate you’ll likely pay, so you can be cautious if the dealership presents you with a rate that’s too good to be true.
Payment shenanigans. One of the most common scams used by car dealerships center on monthly payments. Instead of talking about the things that really matter with the vehicle, including: selling price, interest rate, down payment, and residual value (if you’re leasing), they talk in terms of monthly payment. A $300 a month payment is all fine and well, but where is that figure coming from? Is it a seven-year loan? Is there a balloon payment at the end of the note? Don’t let the salesperson direct the sales price conversation to center on “monthly payment.”
Holding out on holdbacks. Car manufacturers sometimes offer cash incentives, known as holdbacks, to help sell vehicles that aren’t moving off the lots fast enough. Some dealers may not share that money with their customers, instead pocketing it for themselves as extra profit. To avoid getting caught in this dealership scam, check online for information regarding what holdbacks manufacturers are offering. If you find that there are incentives for the make and model you’re considering, be sure to ask the dealership to apply them to the sales price after you’ve negotiated the lowest price you can for your car.