2 Auto Sales Scams You can Avoid Easily!
Most car dealers you’ll interact with will probably be nice and law abiding folks who are simply doing their jobs. Unfortunately, among these honest people there will be a lot of fraudulent dealers as well who will try to trick you.
However with sufficient homework done, you will be knowledgeable enough to avoid all the possible car dealer fraud attempts.
Here are 2 auto sales scams that can be easily prevented:
No trade in pay off
If you’re planning to trade in a car you still owe money on, make sure you work with a reputable dealer. Some unscrupulous dealers will convince you that they’ll pay off your old loan with proceeds from your new loan, but then they will fail to do it and simply pocket your loan payoff. If the dealer doesn’t pay off the loan on your trade, the loan responsibility is on you.
To avoid this scam be sure that the dealership includes your loan payoff on both the buyer’s order and the installment contract. Many new car dealers require you to confirm that you have a payoff on your trade as part of their normal process, so this is really only a concern if you’re working with a small-time dealer.
Straw purchase scam
If you have bad credit, the car dealer’s finance department will inform you that you need a co-signor. Then they will try to get the actual car loan in that person’s name and not yours.
The best way to fight this car buying scam is to have your co-signor with you, and ensure they are only signing contracts that relate to them helping you get your own loan. Of course it would be better if you could get your financing on your own away from the dealer.
If you have already been defrauded by a car dealer and believe your rights are neglected, turn to an auto fraud attorney in your region.