The Payoff Your Loan Scam
When buying a new car, people most frequently turn to car dealers as to the most knowledgeable and trustworthy people to buy a car from. However this is not always the case. Some car dealers are simply dishonest and use really mean scams for tricking you. So one should be extremely cautious to avoid becoming a dealer fraud victim. Today we will discuss the The Payoff Your Loan Scam and try to reveal the related dealer tricks.
This is when the dealer offers to pay off the balance of your current car loan no matter how much money you still owe. It is a common sales strategy. When the average buyer hears this, they think that by purchasing a new car with a new dealership, they will automatically owe no more money on their current car. That couldn’t be further from the truth. What really happens is that the car dealership does help you get out of your current contract, however they are normally forgetting to tell you how high your fees are going to be for breaking the lease agreement with your old dealership. So now you will have to pay fees that are in the thousands to compensate for it. You will also not be able to refinance for a new car until those fees are paid. Of course the dealership can add the cost on to your contract with them at a substantially higher rate. The sole reason why the dealership agrees to this deal is because they want to get more money off of your current car. They aren’t really doing anything for you at all. The dealership will also give you far less than the car is worth on the trade in. This car scam works because they will up your monthly fees, and then sell your trade in for more money than it’s worth. The dealership will then extend your monthly payments in order to conceal extra year of payments.
To avoid this car dealer scam, you have to ride out your current lease until the end. If you are really determined to get a new car, then you should try selling your current car on your own. Possibly make a deal so that the buyer pays much down and takes over the lease payments. Make sure you get legal documents so you don’t end up with bad credit from someone who decides not to pay. Also make sure the buyer carries enough car insurance.